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Some thoughts on the Employment Tribunal system post General Election

18 Sep 2014

I was fascinated to read about Labour’s proposals to scrap the existing Employment Tribunal (ET) fee system and to review the Tribunal system to make sure that it delivers more for all who are involved in it.

The time is ripe for review, not only because of the impact of the bluntest of tools – the imposition of the fee regime, but also because much of the system just does not deliver as efficiently as it should.

Here’s a few suggestions for the politicians to consider:

What should the aim of the ET system be?

The overall aim must be to provide access to justice (in the context of employment) in a fair and proportionate way. It must be fair because that is an inherent part of any decent society and proportionate because it must recognise the competing demands on the resources of all those involved, whether that is the public purse, or the resources of employer or employee.

Informal resolution processes - don’t re-invent the wheel

How about using the existing ACAS arbitration process (as distinct from the ACAS Conciliation process)? Here is an extract from the ACAS website: “Acas Arbitration can be used to decide cases of alleged unfair dismissal or claims under the flexible working legislation.” Very few people know about this service. How often is it used? It is so badly publicised that a couple of years ago, when I called ACAS to enquire about it, they denied all knowledge of it and insisted that I must be talking about conciliation. I had to direct them to their own website.

The ACAS arbitration system strikes a good balance and retains both a sense of fairness and informality.

Promoting conciliation at the right time is critical

Settlements bring advantage to employer and employee. Most claimants bring claims and pursue them to hearing because they are seeking financial recompense. For the hundreds of times I have heard claimants and their representatives say “It’s not about the money. It’s a matter of principle!” I cannot think of a single occasion when the financial lure  of a settlement has not held sway. In short, money talks and will persuade even the most fervent Claimant to settle.

Equally, the good news is that employers see the commercial advantage in resolving claims which presents a wonderful opportunity! ACAS early conciliation is a good move in this respect. One difficulty however is the time line. Invariably at the outset of a claim both parties are full of anger or indignation and their willingness to compromise is probably at its lowest at that point. It is a feature of all types of litigation that the pressure of an impending hearing, and associated risk, is what pushes parties towards each other in terms of the price at which they are prepared to settle - much later down the line. Keep ACAS involved throughout and parties can create and take advantage of opportunities for conciliation that arise later in the day.

Unmeritorious claims

The biggest frustration for employers and what brings the ET system into disrepute is unmeritorious claims particularly those that are lodged with a view to trying to secure a commercial offer from employer (to avoid cost and the trouble of ET proceedings). I am not for a minute suggesting that the majority of claims are unmeritorious or even that they are rife. They do, however, exist and to a significant degree.

Of course ET fees have had a huge impact on the number of all claims, including unmeritorious ones. But that is a blunt tool which impacts on those with meritorious claims too.

We have always had sharper tools to deal with unmeritorious claims. Strike out and deposit order powers have always existed in one form and another but ET Judges have always been reluctant to use them, generally for fear of being accused of prematurely dismissing a case before a Claimant has been given an opportunity to advance it.

Yes, those powers to dispose of cases without full hearing do create a small risk that some meritorious claims are undeservedly struck out along with the unmeritorious ones, but it is a question of proportionality. No legal process can claim to be perfect. Ultimately every claim in every jurisdiction is subject to the fallibility of human error and assessment, however the benefits of a system that is proportionate and respected outweigh the potential for injustice.

Promote the principal of proportionality

Do not allow excessive amounts of the system’s time and resource to be absorbed by issues that have little value. Encourage Judges to apply the principle robustly

Directions and the ET processes

Keep them simple and fair and enforce the requirements more rigidly. Compliance with basic processes saves time and encourages fairness.

Whatever the result come the election, there are plenty of ways the existing Tribunal system can be refined  before tearing up the rule book and starting again.

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