The employment litigation landscape is changing at a rapid pace.  To understand readers’ practical experience of the reforms to the Employment Tribunal process implemented last year and opinion on the likely impact of 2014's planned reforms, we invited recipients of our e-briefs to tell us their thoughts on:

  • the introduction of fees in the Employment Tribunal;
  • the increase to qualifying service;
  • mediation; and
  • early conciliation and employer penalties.   

In particular, we sought to understand readers’ experience of the introduction of fees for bringing Employment Tribunal claims, including whether it has reduced the number of claims.

The full report includes an analysis of the results of our survey conducted between 14-31 January 2014 and is based on 180 responses.

Summary findings  Our survey responses suggest that over 40% of employers have experienced a reduction in Employment Tribunal claims, with the biggest apparent drop being in unfair dismissal claims.

Under the current system, claimants must pay an issue fee and a hearing fee. The hearing fee was believed by the Government to provide a second opportunity to settle cases pre-hearing. However the study results indicate that this has not been the case, with only 8% of respondents believing the requirement to pay a hearing fee encouraged settlement and a third (33%) believing the hearing fee has made no difference at all to settlement. Of the remainder, 5% said that the hearing fee acted as a deterrent to settlement.

Of our respondents:  

  • 44% believe the extension of the qualifying period for an employee to be able to bring an unfair dismissal claim from one to two years has led to a reduction in Employment Tribunal claims;
  • 41% feel that recent changes to Tribunal Rules have enabled them to address weak and vexatious claims;
  • 66% admit to taking no practical steps in preparation for employer penalties in force from April 2014;
  • 73% expressed the view that mediation was always or sometimes successful, 40% having attempted mediation during the last year; and
  • just less than a third saw the recently introduced £600 fee, payable by the respondent, as a barrier to judicial mediation, though 68% felt the fee would make them more likely to use private mediators such as ACAS.

Conclusion

It is beyond doubt that the employment law landscape is changing at rapid pace. That Unison’s recent challenge was unsuccessful means that the fees regime will remain unaffected for the time being at least. However, the High Court left the door open to a fresh challenge in the future, when the impact of fees on claim levels becomes clearer. That being the case, the long term future of the fees regime is not yet secure.

Few employers will be sorry that the fees regime will remain, for the time being at least, as this means fewer Employment Tribunal claims. One thing that is becoming clear is that, by introducing fees, the Government has made significant inroads into one of the perceived weaknesses of the system, namely that it allowed weak and unmeritorious claims to proceed with impunity.  Although preventing such claims was not one of the Government’s stated aims in introducing fees, the regime will continue to be welcomed by most employers if the number of claims they perceive as weak and unmeritorious is reduced.

Longer term, however, for those claims which do proceed, it seems likely that employers who lose in tribunal or who choose to settle cases early will need to pick up the costs of at least some of those fees. Employers will also need to guard against blatant or reckless breach of employee rights, if they are to avoid the financial burden, not to mention potential stigma, of employer penalties. For these and the reasons outline above, the advantages of alternative dispute resolution may appear an increasingly attractive option, either through EC or mediation.