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Tribunal claim numbers plummet, will they drop even further?

17 Mar 2014

The Ministry of Justice (MOJ) has just released quarterly statistics for the number of Tribunal claims submitted. They are the most powerful evidence yet to support what most employment lawyers have been saying for some time. The introduction in July 2013 of fees in the Tribunal has had a dramatic effect on the number of claims being presented.

The figures for October to December 2013 show that there was a 79% drop (compared with the same period in 2012) in the number of applications lodged. The number of single claims has dropped from a monthly average of between 4,000 - 5,000, down to 1,700 (a drop of about 63%).

The perceived wisdom amongst employment practitioners is that the type of claim that is less likely to be presented now is the opportunistic claim. Such claims are submitted in the hope that the employer will make a commercial offer. The fee now involved makes that particular gamble less attractive.

What about the impact of ACAS early conciliation?
We now have compulsory ACAS early conciliation on the horizon. The scheme is due to come into force on 6 May 2014. After that date, a Claimant, in most cases, will not be able to present a claim to the Tribunal unless, prior to submitting the claim, they have contacted ACAS in connection with conciliation. ACAS will then establish whether the parties wish to pursue conciliation. If either party declines to participate in conciliation or if it is pursued, but is not successful, the Claimant can continue to present a claim to the Tribunal.

A year ago, presenting a Tribunal claim was as straightforward as completing an on-line form and hitting the return key, a moment’s work for some. The introduction of fees changed that. Compulsory conciliation introduces a further layer of process and delay which may discourage claims.

Compulsory early conciliation also gives the opportunist Claimant a chance to test the water by contacting ACAS and seeing what the employer’s response is, perhaps making it less likely still that such claims will find their way to the Tribunal.

If weightier claims are surviving, will this continue?
It is doubtful that early ACAS conciliation will have much of an impact on these types of claims. Experience suggests that it is the pressure of a pending hearing and the attraction of a cash sum that produces a conciliated settlement. For both parties there is the unenviable prospect of the time, trouble, cost and stress of a hearing – not to mention the fear of defeat. Those pressures to compromise do not exist, certainly not to the same degree, at the early conciliation stage.

Possibly the biggest factor that will influence the number of higher value claims is the economy. Logic would suggest that a healthier economic environment, with dwindling unemployment will encourage a further drop in the number of claims. Greater availability of opportunities to secure alternative employment should reduce a Claimant’s losses and should reduce the value of potential awards.

The MOJ’s figures make interesting reading. The Government appears to have had significant success in slowing what some see as a gravy train. It is difficult to see that trend changing.

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