Tribunal claims surged during lockdown, official figures show

Experts warn the rise is likely to continue if employers are not meticulous about redundancy processes, and urge firms to avoid basic errors

The number of claims lodged at employment tribunals surged during the first three months of lockdown, official figures show, as experts warn the coronavirus crisis could see claims “skyrocket”.

The latest statistics from the Ministry of Justice (MoJ) reveal the number of single claims – where claims are made by an individual claimant – made between April and June this year was 10,318, an 18 per cent rise compared to the same three months of 2019, when this figure stood at 8,772.

This was accompanied by a drop in claims being disposed of – where the court issues a summary judgment without a full hearing. These fell to 4,496, down 21 per cent compared to 5,695 the previous year.

In its quarterly report on tribunal statistics, the MoJ attributed the increase in claims to rising levels of unemployment because of “the impact of Covid-19 on the economy”, and said this was “the highest level of single employment tribunal claims since 2012/13”.

“This rise in employment receipts is likely to continue as the government’s job retention scheme comes to an end at the end of October,” the report said.

In a bid to deal with demand, the report said Nightingale courts – a similar premise to the Nightingale hospitals set up to cope with Covid-19 patients – had been set up to “add temporary capacity” and the use of audio and video technology increased, “enabling judges to conduct remote hearings to a far greater degree”.

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However, some employment lawyers have warned that the number of cases brought to tribunal is set to increase further, putting the tribunal system under more strain. Claims were likely to “skyrocket if employers [were] not meticulous in how they managed the redundancy process,” warned Ranjit Dhindsa, head of employment at Fieldfisher.

“Some employers are automatically making furloughed employees redundant, but employees have been furloughed for numerous reasons, such as childcare obligations or health concerns,” Dhindsa said. “This automatic move to redundancy could trigger claims over discrimination.”

However, Dhindsa added that the backlog in claims might not all be bad news for employers, who could “take advantage of the delay in the employment tribunal process by continuing to defend the claims or negotiate much more commercial settlements”.

Malcolm Gregory, partner at Royds Withy King, also warned the number of claims could still increase further, with some currently “suppressed” as employees opted to “sit tight” during furlough. “I think the number of claims is set to rise significantly now and we will likely see a lot of claims relating to unfair redundancy, changing terms and conditions unlawfully and contractual issues around pay and benefits,” he said, expressing fears that a surge in cases “will soon overwhelm the system”.

The best way for employers to minimise the risk of a claim was to take advice at an early stage, Gregory said: “It may cost initially, but it could save you a lot of time and money down the line.”

Glenn Hayes, employment partner at Irwin Mitchell, said he also expected the number of claims to rise. Some employers, in their rush to cut costs, are making “basic errors in their redundancy programmes such as not going through a fair procedure”, while others are “getting rid of older staff which is directly discriminatory,” he said. 

“Companies should be aware that they are at risk of tribunal claims if they attempt to use redundancies as a cloak for breaching employment rights.”

The rise in claims is “concerning”, added Rachel Suff, senior policy advisor for the CIPD. “The current crisis means there's significant potential for conflict in workplaces, and employers and HR need to consult and communicate with their employees to support them through these challenging times,” she said.

Kate Palmer, associate director of HR Advisory at Peninsula, added that the increase in claims should “send a clear message to employers to make sure they are approaching all aspects of staff management in line with employment law”.

In contrast to the surge in single claims, the MoJ figures revealed the number of multiple claims – those brought by a group of claimants – submitted in the three months from April this year were down 43 per cent compared to 2019. 

However, disposals for multiple claims were also down 47 per cent over this period compared to 2019. As such, by the end of the quarter, the total number of outstanding multiple claims had risen to 417,765 – the highest level since 2014/15.

Overall, just 6,400 of all employment tribunal claims were disposed of during April to June, down 31 per cent on last year. “This decline in disposals is likely due to Covid-19-related impacts on the tribunals,” the report stated.