The Enterprise and Regulatory Reform Act 2013 includes a number of measures to encourage employers and employees to settle disputes at an early stage. These include a new provision which, at least on the face of it, will allow employers to open negotiations with their employees about terminating their employment on agreed terms without the risk of these discussions being disclosed in subsequent unfair dismissal proceedings. However, this provision will apply only to ordinary unfair dismissal claims, and not to claims for automatically unfair dismissal or discrimination of any kind. The employer will also lose protection if it has done anything which a tribunal views as ‘improper’. In addition, in a bid to make them more popular, compromise agreements will be re-named settlement agreements, and ACAS has been asked to draw up a code of practice to promote their use.

Rule changes

Mr Justice Underhill, the former president of the Employment Appeal Tribunal (EAT), was asked to undertake a radical overhaul of the employment tribunal rules of procedure. The results were published in the summer of 2012 and have now been the subject of further consultation. The new rules will be shorter and simpler, but the changes will not be as radical as the last major set of amendments introduced in 2004. Some details have changed, but it is unlikely employers using the tribunal system will notice a great deal of difference as a result of the rule changes on their own. They are more likely to notice the re-designed forms, and may also benefit from greater consistency across the regions following the introduction of draft guidance for employment judges on a number of procedural matters.


It is planned that claimants who take their case to a full hearing will need to pay both an issue fee and a hearing fee, with the precise amount depending on the complexity of the claim. Fees will also be introduced for counterclaims and some applications such as review of a default judgment. There will be a fee remission system modelled on what currently happens in the civil courts. The tribunal will have power to order respondents on the losing side to refund the fees.

Capping compensation

The Government proposes to introduce a new cap on the compensatory award for unfair dismissal to sit alongside the current maximum figure (£74,200 as from February 2013). This new cap will be specific to the applicant, and will cap that individual’s entitlement at the equivalent of 12 months’ wages, if this is lower than the current maximum.

Compulsory conciliation

The plan is that for most types of claim a claimant must lodge details with ACAS first. It will not be possible to begin proceedings until the compulsory conciliation period, normally a month, has passed. The three month time limit that applies to most claims will be extended by the length of the conciliation period


All these changes are planned for summer 2013, with the exception of compulsory pre-issue conciliation, which will not be introduced until April 2014