Good Riddance to Employment Tribunal Fees

Well, it’s been a long time coming, but the Cameron Government’s decision to charge fees for people to raise claims in the Employment Tribunal has finally been shown to be illegal.

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In a landmark ruling, the Supreme Court has ruled that charging people up to £1200 so they can challenge the legality of their employer’s actions is illegal.

Fees were never introduced in Northern Ireland, and it is notable that there was no drop off in the number of applications to go to their Industrial Tribunal.  Meanwhile, across Great Britain, ET applications plummeted by 70%.  In Scotland, the SNP Government stood for election in 2015 with a pledge that, as soon as they had the power to do so, they would legislate to remove Employment Tribunal fees, justifying this on the premise that someone who has just unfairly lost their employment is unlikely to be able to find the money and will, therefore, be denied access to justice.

Introduced in 2013, fees were initially justified as being to reduce the number of “weak claims”, though a financial incentive later became apparent with the Justice Minister at the time stating

We want people, where they can, to pay a fair contribution for the system they are using, which will encourage them to look for alternatives.

That case was never particularly convincing and the result, inevitably, was that many people with a valid claim were unable to bring it because they couldn’t pay the fee.

Alongside the fees, the Cameron Government also introduced mandatory Early Conciliation.  This is a process whereby the parties, with facilitation by ACAS, can try to reach an out of court settlement and is something applicants have to do before they can complete their ET application.  Although there’s nothing wrong with this in principle, my experience of it wasn’t good.  I have found few employers prepared to negotiate towards a settlement, preferring to gamble on whether or not the applicant could find enough cash for the fee.  Perhaps, with fees now found to be illegal, there will be a greater incentive for all sides to take a more pragmatic, conciliatory approach.

Dave Prentis, the UNISON General Secretary, welcomed the Supreme Court ruling saying:

The government has been acting unlawfully, and has been proved wrong – not just on simple economics, but on constitutional law and basic fairness too.

In this context, the positive role of trade unions shouldn’t be underestimated, and not just because it is through UNISON’s expertise and persistence that this ruling has been achieved, but more locally and practically as well.  A well-trained union rep can defuse and head off the vast majority of cases referred to them, most often through facilitating a pragmatic solution, sometimes through persuading an individual that their case doesn’t stack up.  As an example, this leads to a significant reduction in the number of cases going to grievance, and those that do proceed tend to be much better presented.  This is something that many employers could easily miss.

That principle also filters through to ET applications.  Unions take great care in presenting cases, cases they support are exceptionally unlikely to be regarded by the Tribunal as “malicious, vexatious or frivolous” or “in bad faith”, and a significant proportion are successful.

Of course, most trade unions opted to pay these fees for their members, but many, many people who weren’t in a union must have been denied access to justice by this ill-conceived policy.  While it is likely that those who applied to the ET will have their fees repaid, at this stage it seems likely that those who couldn’t afford the fee at the time will have missed their opportunity, but it remains to be seen if any pragmatism will be shown in that respect.

 

I’d be interested to know your thoughts on the issues raised in this article, so please leave a comment or, if you’d like to discuss anything more directly, please contact me at malcolm@strathesk.co.uk or give me a call on 07736068787.

 

Trade Union Act looms large…

This extremely useful summary by David Morgan at Burgess Paull of the upcoming changes through the Trade Union Act caught my eye, and brought to mind some of the key issues surrounding the Act.

The existence of this legislation in the first place is a bizarre piece of ideological policy making, since it certainly isn’t/wasn’t responding to an actual need. To quote from the Office of National Statistics:

“The 2015 working days lost total (170,000) is not only lower than the total last year, but is the second lowest annual total since records began in 1891 (the lowest was 157,000 in 2005).”

As well as being of questionable need, the legality of the provisions has been questioned in many quarters, but most notably, perhaps by the Governments own Equality & Human Rights Commission. In January last year, the EHCR warned that the provisions may breach international law, stating:

“As it stands, the Trade Union Bill is in danger of imposing potentially unlawful restrictions on everyone’s basic human right to strike. Joining a trade union and peacefully picketing outside workplaces is a right not a privilege and restrictions have to be properly justified and proportionate.”

Although some changes were made before the Bill passed into law, research compiled by the Industrial Law Society suggests that these did little to address concerns in relation to human rights. If this latter article is correct, although we might have expected to see a number of challenges under Article 11 of the European Convention on Human Rights should employers opt to assert the new laws, these cases will be difficult to build and therefore may not emerge. Most of the large unions seem to be focusing their efforts on getting better organised, while experience shows that they will adapt to the new legal framework in spite of the additional inconvenience.

Interestingly, and in stark contrast to the Whitehall position, the Scottish Government announced in November 2016 that it was creating a Trade Union Modernisation Fund “to support modernisation of trade unions and help mitigate the negative impacts of UK legislation.” In that context, it will be interesting to see if there are differences of approach north and south of the border once the legislation has been enacted.

Of course, I’d be interested to know your thoughts on this subject, so please leave a comment, but if you’d like to discuss this topic more directly please contact me at malcolm@strathesk.co.uk or give me a call on 07736068787.

Brexit in the workplace – what now?

The long and the short of it is that nothing will change immediately – the impact of European case law remains unchanged, albeit the vast, vast majority of case law originates through the UK’s Employment Tribunal system (primarily at EAT and Court of Appeal).

EU Directives on Employment Law are implemented through enactment into UK Legislation, usually by Regulation, less frequently by primary legislation. In this respect, many of the laws that have originated from the EU have become workplace norms (e.g. protection of fixed-term workers and part-time workers).

There is a risk that more recent and less accepted legislation may be under pressure to be repealed (e.g. Regulations on Agency Workers). There may also be changes over time in relation to the calculation of holiday pay and accrual of annual leave during sickness absence.

No doubt a surprise to many, there are various aspects of Employment Law where the UK provides greater than that stipulated by EU Regulations. This covers holiday rights, protection against discrimination, TUPE (which covers service provision transfer in the UK, unlike elsewhere in Europe), etc.

That said,  companies working throughout Europe and currently depending on UK laws to meet the requirements for a European Works Council may need to review their arrangements.

What about the rights of EU Nationals to work in the UK?  Well, it’s again difficult to say as yet, but special permissions may be needed to work here in future, perhaps with sponsorship, as is the case for non-EU nationals, but in the meantime, EU nationals working here are entitled to stay and continue working. The main protagonists on the Leave side made contradictory statements, so it is difficult to tell what may change, though Theresa May stated a desire to clarify this point quickly, while Nicola Sturgeon has moved to say their position is secure in Scotland.

But what will happen if there are non-UK nationals applying for jobs now? If they are employed, they may be forced to leave in a year or two’s time, but NOT employing them because of that would currently be illegal discrimination.

The UK currently already has a points based system for non-EU nationals which COULD be extended, at least for skilled workers, though Tier 3 (unskilled workers) would need to be reactivated. There hasn’t been a need for non-EU unskilled workers because that gap has been filled from within the EU, but that source is clearly likely to dry up as/when the UK withdraws from the Single Market.  If employers have a need for unskilled workers that they can’t meet from domestic recruitment, this needs to be flagged up with the Government.

The future for Employment Tribunal fees?

Applications to the Employment Tribunal in Great Britain have nose-dived since fees were introduced in 2014. But is it good for 70% more people to bite their lip? And is there an alternative to calling their bluff?

Recent Employment Tribunal figures show that the total number of claims for unfair dismissal in Great Britain fell to 12,652 in 14/15.  Compare this to the 92,000+ unfair dismissal claims in 11/12.  While cause does not necessarily imply effect, the timing of this fall correlates exactly with the introduction of fees for each application to the ET.  The recent figures confirm the trend implied by previous figures since the introduction of the fees, evidence enough to convince the current Scottish Government to announce that, under the new powers in the Scotland Act, and IF they are re-elected in May, that they will withdraw the fees from the Scottish ET (which would bring Scotland into line with Northern Ireland, where the fees were never introduced in the first place).

Few people who take a case to ET return to that employer, even fewer successfully raise a claim and stay employed there. Conversely, the costs of recruiting and training someone new are enormous – the 2015 CIPD/Hay Resource & Management Planning Survey indicates that recruitment costs alone can be up to £10,000, not including training and development.  Compare that to the costs associated with resolving a problem so a member of staff can remain a member of staff.

At the same time, of the unfair dismissal cases that were upheld, the median award was £6,955, a drop in the ocean compared to the legal costs, operational disruption and emotional upheaval involved in a Tribunal – most often, there are no winners.

Far better would be to find a mutually acceptable solution – whether through mediation, developing managers or by introducing more effective processes, or a combination of all three. Invest a little in mechanisms to avoid the ultimate employer/employee conflict, and potentially boost morale and productivity into the bargain, or pay the costs – the choice is yours.