Tribunal fee abolition – update.

Tribunal fee abolition – update.

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27 Sep 2017

When tribunal fees were introduced in 2013, claims dropped by 70%. Now the fees have been abolished the signs appear to suggest an increase in claims. In the last few weeks alone we've seen client cases we would have expected to have fizzled out quietly instead hit the ACAS Early Conciliation phase, a necessary step prior to tribunal proceedings.

A small sample perhaps but sure as ‘eggs is eggs’ the removal of a requirement to spend money to bring a legal case against an employer is bound to see as sharp an increase in tribunal claims as the decrease we saw in 2013 – 14 after the fees were introduced.

£32m of fees were taken by the tribunal system since their introduction and all of that money will now wend its way back to claimants who brought cases over the last 4 years. Furthermore the Justice Minister has said that facilities could be made available for claimants who would have brought a claim but for the fees to bring their claim now. It is arguable of course as to whether justice can really be done in a (potentially) 4 year old case given the passage of time, people and the probable deletion of relevant records.

But looking to the future it is inevitable that some ex-employees who previously wouldn’t have stumped up £1200 to bring a claim to tribunal will now bring a claim, even in the simple hope that the employer might settle for a modest sum rather than go through the expensive process of preparing to defend themselves.

Given the increasing risk it’s more important than ever to ensure that processes resulting in employee exits are robust. There’s nothing a smaller employer hates more than a convoluted HR process, but some process is inevitable e.g. when contemplating redundancies. If an employer fails to follow a proper redundancy consultation the resulting dismissal will be unfair and a tribunal claim will succeed. In another article, Exiting Employees Safely, we’ll cover some of the options open to employers when the end of the road has been reached.

Some employers may now be wondering whether it’s time to buy tribunal insurance, or sign up to a service that offers litigation protection. A good general business insurance policy may already come with some form of legal expenses cover – check what you have already before contemplating an alternative policy. When it comes to litigation insurance or services that come with it, our experience (based on customer reviews) is that they are poor value. Such services (normally very well marketed) come with a call centre and a burning desire to not take any risks at all – so the advice is so hopelessly risk averse as to be useless, the priority being to make sure the insurer is protected. This is the land of the convoluted HR process, notwithstanding the other call centre issues, different person every time, inexperienced ‘advisors’ etc.

If we employ people we need to accept there will always be some risk. By treating people decently that risk will be minimised. If regrettably we have to part company with an employee, we need to ensure we have a good reason and follow a good process, being open minded to alternatives that might arise. Access to good quality HR advice and a willingness to listen to it is important. The days of ‘you’re fired’ have gone.

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