Tenth CEDR Mediation Audit – Author’s Commentary
by Graham Massie
Tenth Mediation Audit
When we launched the CEDR Mediation Audit in 2003, the primary objective was to provide some research evidence on the early progress of commercial mediation. Since then the Audit has fallen into a biennial pattern and, now, twenty years later, we have its tenth iteration.
Over the years, we have tracked mediation’s progression from being a movement of enthusiasts to becoming a credible profession that is now part of the mainstream of the civil justice system. Along the way, vital support has been gathered from the judiciary, government, law firms, businesses and, of course, increasing numbers of satisfied clients who have experienced the benefits of negotiated dispute settlements when they are facilitated by a trained professional.
Our Tenth Audit report now provides the latest update on the overall size of the field, as well as its impact and how mediation techniques are evolving. We also update our analysis of who the mediators are, how much work they do, and how much they charge. Finally, this year’s special emphasis has been on the question of Mandatory Mediation – are mediators ready and available to get involved, and what are their views on the potential obstacles or issues to be addressed?
Our Audit attracted 328 responses from mediation practitioners who come from a wide range of professional backgrounds and affiliations. We’re grateful for the support of the Civil Mediation Council and its member organisations to help us reach as wide an audience as possible.
Highlights of this Tenth Audit are as follows:
Normal service is resumed
Last time around, we estimated that approximately 16,500 mediations were taking place in the UK, but this figure then dropped by 35% during the Covid period, with most of the mediation that did occur taking place on line.
The latest news is that mediation activity has recovered from this enforced downturn. With a new market estimate of 17,000 cases a year, activity is now 3% up on where it was in 2019/20. Given that the last round of Covid restrictions were not lifted until February 2022, the resilience of the field in getting to 17,000 cases by the end of September 2022 is impressive.
Online is here to stay?
When face-to-face mediation was stalled by the early stages of the lockdown, online mediation rapidly stepped up to fill the gap and our Ninth Audit reported that 89% of cases were conducted online.
For most, this was a new experience but, with Zoom and Teams meetings and increased remote working now all familiar parts of our daily landscape, it seems that the case for online has been made.
Not only does our latest Audit report that 64% of mediations were conducted online, but quite a few mediators cited online as the ideal route to avoid unnecessary travel or disproportionate cost for lower value cases. We are also seeing encouraging signs of a blended approach, with some elements of the process (such as preparatory meetings) taking place online even where the “main event” is still held in-person.
Settlement rates are holding up
Our latest Audit reports that settlement rates remain strong, with 73% of cases achieving settlement on the day of mediation, and a further 20% settling shortly thereafter, giving an overall settlement rate of 92%.
But let’s not call that figure our success rate. For there is a lot of anecdotal evidence, from mediators and others, that even a mediation which does not achieve a settlement nevertheless may add value in terms of clarifying the issues and, potentially, reducing costs and stress later on if litigation continues.
The professional pyramid
Just as in any profession, mediation has a wide base but only a limited number reach the very pinnacle in terms of earnings, appointments and reputation.
The process by which an individual makes progress in their career can be opaque, particularly as there a circularity in the challenge that, to achieve mediation appointments, one must usually have proven track record and experience, but that can often only come from appointments.
A particular complication is that mediators generally work alone and in private, and therefore very few witness them in action; furthermore, unlike the Bar or most other professional service roles, there are only limited opportunities for senior practitioners to generate work for their juniors.
As a consequence, a considerable proportion of mediator still report frustration about the challenges they encounter in trying to grow their career. Much of this frustration revolves around the fact that the field is still largely dominated by a select few of no more than 200 very well established individuals.
This picture is confirmed by the age profile of our mediators. The average male mediator is 63 whilst the average female mediator is rather younger, at 54, which is rather closer to the 52 which the Law Society reports as being the average age of law firm partners. Mediators’ average ages are two years older than we reported two years ago – this implies that it is largely the same group of individuals involved.
Of our respondents, 37% were female mediators, a proportion which is now ahead of the 33% female representation amongst law firm partners. Ethnic minority participation is still a concern, at 8% as compared to 17% amongst Law Society membership. More positively, 41% of our survey respondents are aged under 50, up from just 25% last time. This implies that many younger entrants are now coming into the field, a very encouraging sign for the future.
A significant proportion (65%) of mediators now describe themselves as working full-time in the field. However, within that group, 49% report undertaking less than 10 mediations a year. There is nothing in the data to suggest that these individuals are only undertaking very long assignments, thus indicating that the term “full-time mediator” is generally being interpreted to mean that this is an individual’s only job even it is not occupying them on a 24/7 basis. Amongst those who have other jobs, an average of 19% of their time was spent working as a mediator.
Our audit shows a slight increase in the time typically spent on an individual mediation, up by about 8% to 15.8 hours, of which 41% is spent on preparation, including initial client contact, 47% on the mediation day, and 12% on follow-up. Quite a lot of this work may not be paid for.
There is a wide diversity in mediators’ fee rates for a typical one-day mediation. The majority are charging somewhere in the range £500 to £4,000 per case, but a few are charging a lot more – with some even going above £10,000.
Putting all of this together, our Audit shows that the average daily fee of a less experienced mediator is £1,781, or 20% more than two years ago, whilst average fees of advanced mediators have dropped by 8% and are now at around £3,893. It may be that the emergence of online activity has had some impact upon average fees.
Ready for mandatory mediation
This was one of the new areas of questioning in this iteration of the Audit. The UK Ministry of Justice has announced proposals to introduce mandatory mediation for most contested claims under £10,000 in the County Courts. Under this proposal, unless an exemption is granted by the Court, all parties to a defended small claim would be required to attend a free mediation appointment with the HMCTS Small Claims Mediation Service before their case could progress to a hearing.
This development might not, in isolation, have much impact on professional mediators’ caseloads as the work would go to the Small Claims team. However, we have tried to explore whether, if there was to be an increase in demand at slightly higher levels, either because of increased mandating from the Courts or simply from a raised profile for mediation, there would be sufficient capacity in the market to handle the additional work.
Based upon asking mediators whether they would be prepared to take on additional cases in the £10,000 – £25,000 value range, our Audit identified a clear willingness to be involved. On average, mediators told us that they have 83 days of spare capacity which means that, looking at the mediator membership of the Civil Mediation Council as a whole, there is available capacity of some 54,000 days – or 245 mediator-years!
It is therefore safe to assert that a significant expansion of mediation activity following the introduction of mandatory mediation would be well handled by the UK mediation profession a capacity perspective.
We asked mediators what other considerations would be important to them in making themselves available for additional casework. A number raised travel time and travel costs as a potential issue, presumably because these are generally not covered by court or other schemes.
For this reason, many favoured online mediations to avoid travelling. Ease of administration was also an important consideration, with mediators raising concerns that efficiency of the administration of the process would be important to them as, in their experience, the time involved in setting up a mediation, including obtaining relevant papers and agreeing a venue and date could otherwise be disproportionate to the fees available.
Litigants in Person may present some challenges but these are not insurmountable
We asked mediators specifically about their impact on the process – how often did they see particular situations in their mediations with LIPs, and what were the implications on settlements.
Mediators report that LIPs typically do not have a good understanding of either the legal or commercial issues in their case and, as a result, may struggle to presents themselves effectively. Nevertheless, only around half of cases involving LIPs proved harder and take longer to settle. This would suggest that experienced mediators regularly encounter shortcomings in LIP performance at mediation, but often they are able to overcome them.
Nevertheless, these findings do suggest that more educational materials need to be provided for LIPs. In effect, that is the same conclusion as the Government’s own review of the work of the Small Claims Mediation Service where it was reported that, whilst 55% of cases mediated via the SCMS result in a settlement, only 15-21% of parties utilise the service as “many court users do not understand the mediation process and its benefits.”
Concerns around enforcement of mediated settlement agreements are unjustified
We also asked mediators about their experiences of difficulties with the enforcement of mediated settlement agreements as it has long been one of the criticisms from opponents of mediation that this is a weak point. However, the clear finding from our Audit is that it isn’t. Mediators and lawyers report that problems with enforcement really are few and far between.
Mediation delivers considerable value
In every Audit, we present an update on the contribution that mediation makes to commercial life in the United Kingdom.
Most notable are three key figures:
- Roughly £20 billion worth of cases are mediated each year
- Since 1990, around £195 billion worth of cases have gone to mediation
- Mediation saves business around £5.9 billion a year in wasted management time, legal fees, lost productivity and damaged relationships
In summary, mediation has arrived at its desired destination within the mainstream of the litigation system, but its race is far from run. The move towards mandatory mediation appears to be the next challenge on the horizon, and this Audit suggests that our profession is well placed to meet the need.
Our historic growth to a total of around 17,000 mediations a year is certainly an impressive achievement, but with some 247,000 contested Civil law cases in England and Wales each year, the need (and opportunity) is still vast. So, with new approaches, and new areas for implementation of mediation, we are still evolving, but the journey has not ended.