Basic advantages of the conciliation or arbitration process are the informality and flexibility of the proceedings, in which the parties themselves get involved, as opposed to the judicial process where the parties are generally not involved in the proceedings which remain in the control of the court and lawyers. Further, from the cost and speed perspective, a common worker or a trade union of workers can sustain the informal process.

It reduces considerably the caseload of the courts and, as a consequence, the quality of justice dispensed by the courts also improves as courts, then, have a lower pendency of cases and relatively more time for cases they can handle.

In these proceedings, the conciliator or mediator does not take any decision or give any award; decision-making remains the jurisdiction of the parties and based on the consent of the parties, therefore, the feeling of imposition of judgment, which is consequential to litigation, does not occur.