What's the difference between Mediation and Toxic Triangulation?

We are always 100% responsible for our 50% of any relationship.
— Source Unknown

And yet in life, when things are challenging, we often observe how humans focus on the other's 50% while ignoring their own. 
This tendency to deflect responsibility is common in the workplace with employees blaming others while ignoring their own contribution to a problem.
And when they are unable to address their challenge directly themselves, they often turn to third parties-typically those with some power to address the situation in their favor. Their narrative may reveal a victim mentality. Regardless, they want their perspective validated and something done.
If your company has an 'open door policy' employees may go above their supervisors head to address their concerns with someone higher up the chain of command. And from time to time employees do go to HR.
This is where you have to be careful, as there is a thin line between actions that are helpful and those that are not! 
Triangulation occurs when a third person gets involved in the relational dynamics of two others. Toxic triangulation occurs when the third person doesn't restore direct communication, and instead distorts it and either unwittingly or intentionally colludes with the person who complained.
Here's what author's Wilmot and Hooker (on page 226 of their book, Interpersonal Conflict), have this to say about toxic triangulation:

"When people perceive that they are the low-power person in a conflict, their typical response is to try and form a coalition with another person....Three people find it difficult to maintain balance in a conflicted relationship. Usually they become structured as a "dyad plus one. Communication triangles are unstable, leaving one person out."
Ideally, employees who have a functional interdependency, address their issues directly, and find working resolutions themselves. 
When you become the go between for communication and use your influence or positional power to address a challenge on another's behalf, not only do you make it difficult it for yourself, but you support toxic triangulation!
This is what toxic triangulation looks like. B who has less power than A goes to C for support. C takes B's side and communicates with A on behalf of B:

As always, in challenge, lies opportunity!

The potential to take more of a mediative posture arises when we are that third party. You can support direct communication and restore responsibility for decision making to the two involved.

When you do that, and don't take sides, you are effectively mediating. You are equally there for both of them. Instead of contributing toward toxicity, you foster conditions for peace and harmony.
This approach is exactly what the Society for Human Resource Management (SHRM) expects as per their 2014 competency certification model. Here is a link for those interested in a short summary of the relationship management competency, which expects among other things, that senior HR managers "will mediate difficult employee relations as a neutral party."