The experiment was conducted to reduce the parties' reliance on expensive arbitation and to introduce mediation as a method of resolving grievances. Qualitative and quantitative findings indicate that mediation is successful in resolving nearly 90 percent of the disputes and that the procedure was as successful when mandated as when voluntary. All groups of participants preferred mediation to arbitration. Contributing factors to this attitude were the beliefs about whether the third party understood the dispute, the degree of formality, and the perception that all important facts were aired. The time and cost savings of adding mediation to a dispute resolution system depend on how mediation is administered and whether it successfully resolves disputes. Finally, limited research indicates that mediation promotes cooperative behavior between the parties. 1 table, 6 references.