The Changing Employment Tribunal Landscape
As you may well be aware, the employment tribunal landscape has been a bit like a game of ping pong in the last 5 years – first it’s free to raise a claim, then it’s not, then it’s free again. This blog considers the changes and the benefits and drawbacks of the current status quo.
Employment tribunals are by no means a new concept, having been around since the 1960s. However, in an increasingly litigious society, they gradually became common place in employment and the volume of spurious claims became unmanageable for the employment tribunal system. It was felt that there was no deterrent against disgruntled employees to raise a claim, however frivolous it might be. As a result, in 2013, employment tribunal fees were introduced meaning employees had to pay £1,200 in most cases to have their day in court – unsurprisingly we saw a sharp decline of nearly 70% in the number of claims and the employment judges were all able to breathe a sigh of relief at their more manageable workload.
However, in the period from 2013 onwards, there were rumblings the new regime was a barrier to justice, particularly from the employee union arena, and in the end the debate was settled and tribunal fees were once again abolished in July 2017. In the last year, there has been an inevitable spike in tribunal claims with latest figures showing this is as much as a 90% increase. In addition, the average cost of a claim for an employer is rising year on year and is currently around £16,500, not to mention legal fees, management time and potential reputational damage.
Whilst there was a collective groan from employers and HR professionals across the UK when the fees were abolished, let’s not forget the purpose of the employment tribunal system. The balance of power in an employment relationship is weighted towards the employer in the main – the employee is reliant on the employer to provide work so they can pay their bills and earn a living. Nine times out of ten, employers treat their employees fairly but we have all heard news stories of rogue employers… In this scenario, most people would agree it is right and proper the employee should not have to fork out a four figure sum to seek recompense for genuinely poor employment practices. One could argue that a solution to the over-subscribed tribunal system could have been to consider lowering the fee levels or looking at a means tested approach, but as we know, this was not the decision taken as a conclusion to the legal challenge.
Many employers feel that the changes to tribunal fees take us back to the days of treading on egg shells with employees in a world of employment red tape. The relatively short period of employment tribunal fees significantly reduced the number of frivolous claims seen inside an employment tribunal court, and we have once again, taken a step backward by abolishing the fees, in fact, claim numbers are at their highest level since the introduction of fees.
Whilst tribunal fees appear to be here to stay, it is not all doom and gloom - employment tribunals can be avoided with good employment practices, including making sound decisions in relation to employees and having compliant policies and procedures. In the light of the changing landscape with employment tribunals, it is recommended employers ensure compliance with employment legislation and HR best practice and take specialist advice on either an ad hoc or an ongoing basis. For more information on how French Duncan can support you with HR, please contact us on 0141 221 2984 and we will be happy to discuss this further.