Employment Tribunal Reforms

Government plans to make drastic changes

On 27 January 2011 the department for Business, Innovation and Skills unveiled plans that will dramatically reduce the number of claims pursued through the employment tribunal. Resolving Workplace Disputes: A Consultation sets out a number of proposals aimed at encouraging early resolution of disputes without a hearing, speeding up the tribunal system and boosting economic growth.

The proposed policies include a plan to extend the qualifying period in which an employee can bring a claim for unfair dismissal from one to two years, which will substantially reduce the number of claims brought.

One of the aims of the reforms is to reduce the need for cases to go the employment tribunal by introducing compulsory early dispute resolution. It is proposed that claimants should have to submit their claims to ACAS and engage in pre-claim conciliation, which has recently been introduced on a voluntary basis and is proving successful in many cases.

Of particular interest to employers is the proposal to automatically impose a financial penalty on an employer who loses a claim in the employment tribunal. This would be in addition to the damages awarded to the claimant and would be payable to the exchequer. The penalty would be 50% of the award, subject to a lower limit of £100 and a higher limit of £5,000. However, it would be reduced by half if paid within 21 days, to encourage early payment.

In a related announcement the Ministry of Justice is to consult on the introduction of fees for claimants to bring cases before an employment tribunal. The Government is set to launch a more detailed consultation on this issue in the spring.

If you have any queries or would like more information regarding the proposals and consultation process please contact us at commercial@blasermills.co.uk.

If you would like to comment on the proposals you can download a response form from http://www.bis.gov.uk/Consultations/resolving-workplace-disputes.