Long reads

Tribunals: how to keep your business out of court

26 Apr 2018 By Jo Faragher

With employment tribunal cases increasing by 90 per cent since fees were abolished, how will the system cope, and what can employers do to stay out of the firing line?

The claim is not unusual one, but it is certainly complex. A healthcare assistant working for an NHS trust alleges she has been passed over for promotion or blocked from opportunities over several years, and has taken a case to tribunal as she believes this was on the grounds of her race, age and gender. A further claim for unfair deduction of wages is withdrawn. 

The setting for the drama is suitably nondescript, a warren-like cluster of corridors not unlike an out-of-town business park. Air conditioning units roar over the sound of the judge, box files spill from the corners of the room and the central London traffic hums outside. Public observers are shooed out before proceedings begin, while claimants and respondents are ‘held’ in separate waiting rooms. 

As anyone who has been to an employment tribunal knows, there is none of the pomp or grandeur of the criminal court. But the stakes remain high. The claimant names several occasions on which she believes she was prevented from advancing her career; in cross-examination, a lawyer representing the trust forcefully suggests that she simply failed to meet certain criteria or score as well as other applicants. Between them, the employer and claimant’s lawyers have amassed thousands of pages of evidence that have to be read and considered by the judge and her team. 

The case is listed at the London Central Employment Tribunal for just six days and, on the penultimate day, there are still a number of witnesses to be cross-examined. Elsewhere in London’s main tribunal, cases are listed for anything from a day to three weeks. This is employment justice in action – and since a momentous legal decision last summer, it’s been getting significantly busier.  

In July 2017, the Supreme Court ruled that tribunal fees (ranging from £160 to issue a claim to £1,200 if it proceeded to hearing) were unlawful. The union Unison argued that they made it “virtually impossible or excessively difficult” for some people to gain access to justice, highlighting figures showing a 70 per cent drop in claims since fees were introduced in 2013. After two failed attempts to get the regime overturned, the union finally succeeded.  

“For claims to fall so dramatically, it was clear that the whole purpose of the tribunal system offering ready access to justice was not being delivered,” says Sharon Tan, partner at Mishcon de Reya. 

And given the rise in claims being sent to tribunal since, it would be hard to argue that the cost had not discouraged employees from coming forward. In the first full quarter since fees were abolished last year, the number of single claims jumped 90 per cent. Notifications of early conciliations – the step employees and employers must go through to proceed to tribunal – are up by 500 per week since fees were scrapped, according to Acas. 

However, this increased workload is taking its toll on the tribunal system. “When I speak with employment tribunal user groups, our region is showing more than 80,000 live cases, with no increase in resource and the retirement of four salaried judges,” says Beverley Sunderland, managing director of Crossland Employment Solicitors. “In another area, they’re limiting the size of bundles [the pack of evidence supplied by the respondent] to 100 pages.” 

Another lawyer describes case workers as “overloaded” and says calls go unanswered. There are no clear plans yet as to how the Ministry of Justice will deal with the additional workload. “I understand that the president of employment tribunals has made representations to the government for increased resources to deal with the extra demand,” says Paul McFarlane, employment partner at Weightmans, who chairs the legislative and policy committee of the Employment Lawyers Association. “I anticipate that claims will continue to increase, but the likely pace is unclear.”

Much of the growth in cases has come from a return of what might be considered low-value claims, such as unpaid wages and holiday. The returns on such cases might previously have been considered not worth pursuing. 

Jonathan Maude, partner at Vedder Price, believes removing the cost barrier could also accelerate an increase in sexual harassment claims. “People are more aware of their rights, so I wouldn’t be surprised if we saw a rise in these sorts of claims,” he says. “Previously, handing over the cash for a claim might have concentrated the mind of the employee.” Lawyers also predict numbers to grow in sex discrimination and maternity discrimination claims, which both dropped dramatically during the fees regime.  

However, one unfortunate side effect of the abolition of fees is a resurgence in spurious claims. The proportion of cases that might be seen as vexatious has always been a matter of contention. It is extremely difficult to correlate the rate of successful claims with the overall number of claims. But lawyers are clear that there has been an overall increase in volume. 

“We’re seeing more claims from litigants in person,” says Jodie Hill of Thrive Law. “They’re accusing their employer of racism or sexism when it’s simple unfair dismissal – but because they don’t have the qualifying service to bring this claim, they are raising spurious claims. We are seeing companies that have not experienced claims in the past 20 years now facing expensive, multi-day, complex discrimination claims.” 

How prepared are HR departments to deal with the higher risk of being hit with a claim – worthy or otherwise? Consultancy Croner reports a 25 per cent increase in litigation cases in the period from August 2017 to March 2018 compared with the year before. Andy Wills, its head of legal and advisory, says companies are definitely more concerned about issues progressing into full tribunals. “Before, a lot of businesses would take a riskier approach and would gamble on the fact that they would not be taken to court. Now, many are taking a more risk-averse approach,” he says. 

Colin Grange, UK clinical director at LifeWorks, believes it is potentially valuable to invest in an employee assistance programme. “When people feel aggrieved, they can get adversarial early on – calling an EAP line might help them deal with that emotional response and develop an action plan internally, rather than consulting lawyers,” he says. 

Longer term, culture holds the key to tackling systemic issues that are often the root cause of the sort of conflicts and clashes that end in a tribunal. David Liddle, chief executive of mediation specialists TCM and author of Managing Conflict, believes that arming managers with the tools to resolve such issues could be the key to unlocking productivity and engagement – not just avoiding hefty legal bills. 

“You need to take a systemic look at this as an organisation,” he says. “Line managers are essential to good conflict management, but they operate as part of a system. So, for example, is your employee handbook a manual for working together or a message that you don’t trust people? Does your performance management approach reward good people management and effective resolution of problems as well as technical skills?” 

Jonny Gifford, research adviser at the CIPD, adds: “Good employee relations is not just about resolving conflict but helping managers build strong, healthy, robust teams. If you think about how work will change – especially knowledge work – having social cohesion and perceived support is essential. Poor relationships mean you’re more likely to lose that knowledge capital.” 

On top of this, employee relations is not always positioned as a desirable career choice, despite it being one of the challenges HR leaders grapple with the most. “Managers want HR’s support with this; not to outsource it, but for guidance,” says Gifford. “Equipping managers with some mediation skills could help diffuse a conflict before it bubbles up.” 

Gifford adds that he sees a “positive trend” towards more informal approaches to resolving conflict: “You can take a light-touch, facilitated conversations approach, where it’s not fully fledged mediation but something approaching that. The shift that’s happened in coaching needs to happen in mediation too – coaching is now a core line manager behaviour and it’s expected in their core competencies, not something that’s brought in externally. The same needs to happen with mediation, so that conflict is nipped in the bud. The best person to do this is the manager. 

“We should look at the benefits of managing conflicts rather than just the risks of ending up at a tribunal. If we position workplace relationships positively, they can improve productivity and that makes them more immediately relevant. We need to make the most out of social cohesion, even when there’s no threat of conflict rearing its head.” 

Thankfully, despite those alarming initial figures, it’s unlikely that the growth in claims will continue at such a pace, argues Laurie Anstis, partner at Boyes Turner. “A lot will depend on the general state of the economy. In London at the moment, if someone loses their job they can probably walk into something better rather than fight a claim. If there is a continued increase [in cases], it’ll either be down to a decline in the job market or a statistical anomaly such as a glut of holiday pay claims.” 

And if the system does become overwhelmed, there could be an alternative on the horizon. In March, the first ‘virtual’ court case was heard – with a judge sitting in a London tribunal and lawyers presenting evidence from Belfast in a case about fines for a late-filed tax return. The claimant appeared via a home laptop camera and, while there were a few minor technical glitches, HM Courts and Tribunals Service wants to explore how this type of hearing might help speed up and widen access to justice. Could virtual justice be delivered in the complex area of employment law? This is one question on which it might be best to reserve judgement.

The part-time judge: “Claims have increased, but resources haven’t

Sarah King is an employment solicitor at Excello Law as well as a fee-paid judge, so she has witnessed the impact of an increase in claims from both sides in her practice. “When fees were introduced, there was around a 70 per cent drop in claims, and certain types of claims, such as unlawful deduction of wages, fell off a cliff. Since fees were abolished, it can take a long time for claims to be processed and to get a response from the tribunal on claims submitted online,” she says. 

“In many venues, you’re looking at more than six months from the preliminary hearing [for the main tribunal date]. Judicial resources haven’t increased to deal with more cases, so there’s a compound effect with every month.” Judges who took on work in other jurisdictions during the fees regime are back in demand, there are fewer hearings cancelled and judges often need to be available at short notice, she adds. 

If the Ministry of Justice decides to recruit then this has to be built into the Judicial Appointments Commission appointment calendar. The last recruitment round was in 2013 and it would still take time to cover the increased workload as lawyers who go into full-time judicial appointments have to give up practice, requiring notice, and new judges need to be trained up. King says: “There was less of a business case for judicial recruitment while fees were in place, but now there is given the rise in claims and the workload of the tribunal service.”

The lawyer: “It can cost £15,000 to defend yourself”

Jodie Hill is a tribunal advocate and employment solicitor at Thrive Law, having trained as a barrister. “On the tribunal advocate side, we run the case from the beginning, when the ET1 claim is filed, right up to the tribunal itself,” she says. 

“Once the claim has gone in, we conduct interviews and research and submit our client’s response to the tribunal. Usually this results in a preliminary hearing. During this hearing, we engage with the tribunal and the claimant in respect of case management orders and agree the issues to be determined by the tribunal at the final hearing.”  

This preparatory work is lengthy and detailed, and can be cripplingly expensive for employers. “Some companies do this work themselves or outsource it to their HR service provider or the litigation services side of a law firm. A three-day tribunal could cost at least £10,000 to £15,000 to defend, and you have to factor in management time as well,” she adds. The recent surge in claims can also mean employers and claimants are waiting months to secure hearing dates. “In some cases, it could be a year before there’s a date where everyone can attend, which can be stressful for the decision-makers involved.” 

The claimant: “Representing myself at tribunal was surreal”

When Terri Brookes decided to bring a claim against the Government Legal Service (GLS), she took the unusual step of representing herself. Brookes applied for a role with the GLS in 2015, but was asked to take a situational judgement test as part of the recruitment process. As she has Asperger’s syndrome, this meant she could be placed at a disadvantage compared to other candidates, so she argued that she should be able to submit short written answers instead. 

The GLS claimed that its method was still the most proportionate way to screen candidates, and Brookes made a claim for indirect disability discrimination, failure to make reasonable adjustments and discrimination arising from disability. The case ultimately went to the Employment Appeal Tribunal (EAT), where her claim was upheld. 

“I decided to represent myself pretty much from the beginning,” she says. “At the time, you had a choice to either get legal aid and get help with legal representation, or get fee remission, but you couldn’t have both. I had my legal knowledge behind me, and I know my disability better than anyone, so I chose to get the fee remission and represent myself.” 

Brookes was on a legal practice course when the case began, and this was the first time she’d carried a case forward herself. “I had been in court a couple of times before, but not doing everything from start to finish as I was here,” she says. “You read the text books, and then you’re coming up against judges you read about in articles – plus I was up against a major organisation, so I was nervous.” 

There were multiple initial hoops to jump through, including getting an early conciliation number from Acas and putting together the paperwork for a preliminary hearing, which is common in most discrimination cases to establish whether someone’s disability is recognised by law. “The court was very helpful on anything I wasn’t sure on,” Brookes adds. “I could just phone up and they would say ‘you need to do this by then’ or ‘this is the opponent’s responsibility’, which was reassuring.” 

She remembers the initial tribunal as “surreal”. The court accommodated her disability well, arranging seats so she could lip-read when the GLS was putting its case across. The main hearing took two and a half days, and the EAT hearing, around a year later, was over in a day. “I was relieved, shocked and happy to win my case, but it took a long time to sink in because lots of people thought I was crazy for doing it in the first place,” says Brookes. 

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