Mixed reaction to proposed overhaul of tribunal system

Nick Elvin

Businesses and employment organisations have been reacting to a pledge made by a member of the Shadow Cabinet to reform the tribunal system if his party wins the next general election.

Speaking to the TUC Congress in Liverpool last week, Shadow Business Secretary Chuka Umunna said a future Labour government would overhaul the employment tribunals system, to make it affordable for all workers.

Recent figures show that the number of tribunal claims being made has fallen sharply since the introduction of fees in 2013. And earlier this year, legislation came into force making it compulsory for those seeking to make a claim to first try to settle their dispute through the Early Conciliation scheme.

Reacting to Mr Umunna’s speech, Andrew Granger, employment partner at international law firm Taylor Wessing, said: “Most claims are brought by people who have just lost their jobs. We’re seeing people – who would have a good chance of success at tribunal – not progressing with claims because of being unwilling to pay £1,250 to get to a hearing.

“The Government claimed that introducing fees would rid the system of frivolous claims, but there were already mechanisms in place for this purpose and the number of clearly unmeritorious claims was not, in our experience, particularly high.

“Tribunals are expensive for employers too, and it’s not usual to have your fees paid even if you win. Hopefully other government initiatives, such as mandatory early conciliation will be successful and lead to a reduction in the number of tribunal claims – for reasons other than the cost of fees.”

Neil Carberry, the CBI’s director for employment and skills policy, said an effective system of employment tribunals had to work fairly for both employees and businesses.

“Businesses want to see a return to a less bureaucratic system that deals with claims more quickly and run by the Department for Business, Innovation and Skills, rather than the Court Service,” he said.

“Recent reforms which encourage early resolution of disputes are a step in the right direction, and fees to make a claim are a vital part of that. Fees should not remove access to justice for those with legitimate claims, so a review of the level set is something businesses could support.”

Although Mr Umunna did not directly say tribunal fees would be scrapped altogether, some fear such a move would leave small and medium-sized employers exposed to the cost of malicious claims.

Victoria Brown, managing director of Liverpool-based HR provider, High Performance Consultancy, said the fee system had proved its worth, adding: “It discourages malicious and false complaints by challenging those making the allegations to pay towards proceedings. Without this layer, which forced complainants to consider whether their case has merit, the floodgates will open.

“Disgruntled employees will feel able to bring spurious, false cases to retaliate against their employer for any perceived slight. Even if they lose they know that the cost of the proceedings will fall on the employer and so in every way, business loses.

“Introducing the fee system has encouraged employers and employees to find other, more constructive forms of conflict resolution. By maintaining a dialogue and airing their concerns in order to improve things, employees have been able to highlight concerns while keeping their job, and employers have been able to learn and improve the workplace without the trauma of costly tribunals and replacing staff.”