Later this month long-awaited changes to the tribunal system will come in to effect. You can almost hear the collective sighs of relief from employers across the land filled with hope that the days of the vexatious tribunal claim are all but over. The new procedures will, crucially, see the introduction of a cost for employees to bring a claim against their employer. From July 29, employees will have to pay at least £160 to lodge a claim and a further £250-£950 if their claim is accepted and given a hearing date by the Tribunal Service. This new fee is meant to present an element of financial risk for the employee, who will only get the amount back if they win their case. The hope is this will reduce the volume of cases, especially low-value and vexatious claims, being brought to tribunal and therefore, in theory anyway, saving employers from unnecessary cost in money, time and stress. With the average tribunal costing employers around £5,685, and with 186,000 tribunals held in 2012, few businesses will mourn the change. This isn’t to say employers are off the hook completely though, and this certainly isn’t a signal employers to start acting like the proverbial Victorian mill owner. It’s actually likely those cases that do actually make it to court are going to have more chance of success if an employee has had the mettle to go all the way. There will be costs to employers when this happens too, which includes a £160 fee chargeable to an employer who makes a counter claim. The fee for judicial mediation is £600 and will be paid by the respondent, reflecting the practice where mediation is entered into privately to resolve employment disputes. The tribunal will also have the power to order the unsuccessful party to reimburse the fees paid by the successful party, as well as any fines too. It is also possible that exemptions for fees will be such that most claimants won’t have to pay anything anyway (as is the case now) and that the values of the claims will be higher to reflect the fees, making the employer more likely to settle out of court out of fear of the result. We will be keeping a close eye on the situation to see if this is the case. For those employers unfortunate enough to be taken to tribunal, the changes will not make much difference to the cost in time and resources it takes to defend, and the upset to their business which will ensue. Therefore, while we will hopefully see fewer tribunals, and the death of the ‘no win no fee’ legal eagle, it’s still crucial for businesses to avoid them at all costs by following employment law and taking appropriate advice. To find out how the Forum can help you manage HR and employment law in your business and protect you from tribunal claims with comprehensive legal expenses insurance, call us on 0845 130 1722.
Later this month long-awaited changes to the tribunal system will come in to effect. You can almost hear the collective sighs of relief from employers across the land now that the days of the vexatious tribunal claim are all but over.