According to the American Arbitration Association,arbitration is "a non-binding process where a neutral third party works with the parties to reach a mutually agreeable settlement."

American Arbitration Association

A non-profit organization that offers alternative dispute resolution services, including arbitration and mediation.

Non-binding

Lacking legal force or obligating power; not enforceable by law.

Settlement

An agreement reached between parties in a dispute, before or after legal action, where they agree to resolve the matter, often involving a payment of money.