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With the user fees quashed, is the employment tribunal system now fair for business?

23 August 2017

With the user fees quashed, is the employment tribunal system now fair for business? - Read more

Our community discusses the fallout of a UK court decision to stop charging employees for tribunal access.

The decision by the UK Supreme Court to quash fees for employees bringing their complaints before tribunal has been hailed by most as a moral victory, but we wanted to find out how business felt about it.

The results from our survey of the Governance and Compliance/Core community are strikingly split, with almost half (44%) unsure about whether the new system is fair for business, a third (35%) believing it is fair, while the rest (21%) think it is unfair.

One respondent summed up the justification for the court ruling: ‘Morally it seems wrong for an employee’s ability to bring a claim to defend themselves to be determined by their personal circumstances. The company would surely always be at an advantage under the fee regime.’

Yet another worried: ‘It might encourage frivolous claims.’ One respondent added: ‘There does need to be something in place to deter disgruntled employees from making spurious claims against employers.’

More than half (54%) would support a different fee scheme for employees bringing claims at tribunals, with 19% opposing and the remaining quarter (27%) unsure. ‘A varying level of fees for different claims may deter claimants,’ one person said.

Other solutions concerning costs awards or a deposit scheme were proposed, such as: ‘Maybe charge a deposit of the fees, and then refund for claims deemed by the tribunal to be non-frivolous, even if unsuccessful.’

Another said: ‘Claims are rarely frivolous, though sometimes are ill-founded. Awarding a proportion of costs against them would deter obviously frivolous claims.’ One person added: ‘There should be negative consequences should the claim be found to be frivolous, such as awarding of costs for the employer.’

Some saw pain for business as an inevitable consequence of the tribunal system. ‘This cannot be completely avoided and in a compensation culture environment it is an inevitable side effect to having a fair system open to all no matter what their resources,’ said a respondent. ‘A good off-boarding system can help to address outgoing employee complaints at the point of exit by documenting the issues and the company’s response.’

One person relayed a story of a ‘wrong ‘un dismissed for being abusive and aggressive to other employees’. ‘He won substantial damages to the amazement of just about everyone,‘ the respondent said.

‘He was again dismissed from the next employer for gross misconduct within a few months, for actual physical violence against a fellow employee who confronted his poor treatment of colleagues. They paid to sweep it away and avoid a tribunal. He knew the law and played it.’

Even so, some believe the system already poses obstacles for taking action. ‘I think there’s a lot which deters employees already, including the potential that they may never work again,’ one person said.

Outside of the court system there were many suggestions for good business practice to minimise the risk of employee complaints. ‘Improving record keeping on performance to ensure there is a clear audit trail of performance management makes it less likely that employees will risk going to tribunal,’ one person said.

Another recommended ‘clear and fair employee grievance and disciplinary procedures which are rigorously followed,’ and ‘management training to help identify issues with staff at an early stage and ensure these are escalated and dealt with appropriately’.

One person called for a ‘two-pronged’ approach: ‘When hiring look for someone with a long term view of the firm. The culture is key: if employees feel valued and heard they are less likely to want to take any action against the company.’

Conducted in association with The Core Partnership

If you are a company secretary or governance professional at a leading UK business, and you would like to take part in or comment on future surveys, email team@core-partnership.co.uk

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