As the headlines hit the news on 26 July 2017, I like many others, sat in complete surprise as it was confirmed that trade union, Unison had won their landmark case at the Supreme Court and tribunal fees had been declared illegal. I asked myself, as a result of this ruling, what did that mean for my clients and business owners in general? Are tribunal cases set to soar following the landmark Supreme Court decision?
In delivering its judgement, the Court said “The Fees Order is unlawful under both domestic and EU law because it has the effect of preventing access to justice. Since it had that effect as soon as it was made, it was therefore unlawful and must be quashed”. It went on to say that “the fees were discriminatory against women”
So let’s recap, tribunal fees were introduced in 2013, by the then Lord Chancellor Chris Grayling, as a way of taking the burden off of tax payers who were funding tribunal cases made by employees against their ex/employers. Following the introduction of the tribunal fees which started at £390 and went up to £1200, tribunal cases dropped by around 70%, and opinions have been divided ever since as to whether the fees were stopping legitimate employees from raising claims against employers failing to follow legislation and a fair process.
Unison, the trade union heading the case stated after the ruling that “The government is not above the law. But when ministers introduced the fees, they were disregarding laws many centuries old, and showing, little concern for employees seeking justice following illegal treatment at work”.
The government reacted by advising that tribunal fees would be stopped immediately and a refund would be provided to all individuals charged to bring a case to tribunal since their introduction in 2013. This refund has been estimated at around 32 million pounds, which regardless of people’s opinions as to whether the Supreme Court ruling was right or not, is sure to leave a sour taste when this money is taken out of a pot of funding allocated for something else.
Although this ruling is surprising and took many off guard, following previously failed attempts by Unison, it is now time to take stock of the situation and look at how this decision will potentially impact businesses going forward.
- Will we see an increase in tribunal claims?
- Should employers be concerned?
- What needs to be done to stop unwarranted claims?
These are just some of the questions we have been asked by worried business owners contacting us at HR Your Business Matters over the last couple of weeks. Well, in my professional opinion, I don’t believe we will see anywhere near a 70% increase following this ruling.
The main reason being, the process of ACAS conciliation will continue which for those of you who have never had any dealings with ACAS (Well Done You!) let me explain ……. Currently when an aggrieved ex/employee wishes to submit an ET1 (Tribunal paperwork) they must contact ACAS first. ACAS will listen to their concerns and where appropriate, contact the employer to gain an understanding and evidence of what has happened. Dependant on the reason brought by the ex/employee, ACAS will potentially (although by no means exhaustive) look at the following;
- Has a breach in legislation taken place?
- Is there a case of discrimination?
- Has dismissal taken place inline with one of the 5 fair reasons?
- Has the employer had a reasonable belief to dismiss?
- Was a fair process followed?
The main purpose of ACAS conciliation is to mediate between parties to provide an agreement to stop tribunal proceedings. As well as mediate ACAS can also support in the process of COT3 agreements, entering both parties into a settlement agreement, stopping an ex/employee from bringing a tribunal claim, normally in return for financial compensation.
Should an agreement not be made, and ACAS feel there is a potential claim then they will issue the ex/employee with a conciliation code, which allows the individual to proceed to tribunal.
Now the purpose of this post is not to scare you. If it was, I could detail at length how the impact of a tribunal could not only cost you thousands by way of legal fees and compensation (for which many insurance policies will not cover you for!!). But also the potential impact on business reputation, the stress, worry and pure amount of time and energy you will spend on defending a tribunal claim.
The actual purpose of this post is that as a business owner you don’t even need to worry about tribunals, if your business is doing what it should be. In this day and age, competitive advantage and profit comes to businesses that look after their people which include having the right policies, framework and processes in place.
This doesn’t have to be complicated, hey! my Consultancy, HR Your Business Matters, is built on the motto that we ‘Take The Hassle Out Of HR’ giving you the support and guidance to keep you legally compliant and providing the best people processes, allowing you to do what you do best, driving your business forward!!
If you feel your business maybe at risk (maybe your employee handbook is non-existent or hasn’t been reviewed within the last 12 months, or you feel like some training on fair processes may be required) contact us at HR Your Business Matters.
We will arrange to visit you to complete a Business HR Health Check, giving you support and guidance to keep you legally compliant and managing your team in a fair and consistent way. (In a hurry to find out how compliant you are? Follow the following link and complete your Business HR Health Check online, receiving a bespoke report via email, usually within 2 working days LINK)
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Owner of HR Your Business Matters, a HR Consultancy based in Peterborough, supporting start up, small and mid-size businesses with all of their HR needs including, recruitment, employee relations and training.