Fear shown over tribunal fees debate » SMEInsider

Fear shown over tribunal fees debate

Small business owners may have to face more court hearings as Labour plan to scrap employment tribunal fees if they win the general election.

The number of employment tribunal cases has fallen sharply since the fees were introduced in July 2013. There has been a 70 per cent decrease in the amount of claims brought to court, falling from 153,000 in 2013, to 52,000 between 2014 and 2015. This has thought to been caused by claimants being priced out of court, with fees ranging from £160 – £250.

In September shadow business secretary Chuka Umunna stated to the Trade Union Congress (TUC) that the tribunal fees are ‘‘locking people out of the justice they are entitled to.’’

‘‘If we are elected, the next Labour government will abolish the current system, reform the employment tribunals and put in place a new system which ensures all workers have proper access to justice,’’ continued Umunna.

The statement by Umunna has been met with scepticism by many people involved with small businesses and the tribunal sector, claiming that a tribunal is ineffective for all parties involved. James Sproule, policy chief at The Institute of Directors states that ‘‘fewer than one in 10 tribunal cases against IoD members were won by the claimant.’’

‘‘For small businesses the cost of defending a claim is often completely disproportionate to the value of the claim itself. In some cases this means handing pay-outs where they are not deserved,’’ said Paul Quain, partner at GQ Employment Law.

  • Karen Espley

    ‘the tribunal fees are ‘‘locking people out of the justice they are entitled to.’’’ If the fees were £1000 then this statement is more likely to be true. But £160 to £250 is not excessive and is enough to give people pause for thought about whether they really have a genuine case rather than merely a grudge against the organisation. If it acts as a deterrent to those types of people so that only the genuine cases go through, this is a good thing. It’s terribly distracting and expensive for small companies. Presumably the TUC would offer to pay those fees if it’s locking people out of the justice they are entitled to. Perhaps they should put their money where their mouth is…

  • Ruth Cornish

    I’ve worked in HR for 25 years in the private sector predominantly but I also did 7 years in the public sector. I have had lots of people attempt to win a case against my employer or client at an Employment Tribunal (no-one has ever done it successfully) and I would say that the majority were employees that had been fairly dismissed but who wanted to hurt or cause trouble to their ex employee. So malicious or vexatious claims from employees whose very behaviour was not and never had been reasonable.

    I have also done pro bono work over the years successfully advising people that have genuinely been poorly treated (redundancy money withheld/dismissed for a disability or pregnancy) and even not working they all had backers that could lend money. No win no fee lawyers will take cases on (where they are certain of winning) and pay ET fees.

    What concerns me more as a business owner working with ambitious fast growing businesses is the fear that a possible Employment Tribunal puts into the hearts of many fine business owners. Every business seems to have a least 1 person that is not performing but excellent at managing their managers so they can do exactly what they like. Clearly we (www.amelore.com) know how to deal with these sorts of people quickly and effectively but the fear of the threat of a public Tribunal stops employers giving feedback and feeling able to make the right decisions regarding people.

    I think the Unions (and Lawyers who also say they fear individuals being denied justice) recognise that with less Employment Tribunals there may be less members/clients for them. I sincerely hope that if we have a Labour government again they do not abolish fees or the qualifying time for unfair dismissal (increased to 2 years under the present government) as I fear it will effect the growth and productivity of UK businesses and the economy which is in no-ones best interest.

  • Thanks for your input Ruth and Karen, you both make some excellent points on tribunal fees.

  • Caggs Darley

    We are a small family business established 56 years. An employee gave him his notice, worked the month, got paid everything he was due. During the time he worked for us he was soliciting building work from our clients. which he carried out for cash, in fact he spent much of his time speaking on his mobile phone organising his work with his sub contractors. After he left us his work obviously dried up so some months later he took us to Tribunal for unfair dismissal. Thinking that the truth was enough for the Tribunal we sought to defend ourselves – Big mistake, We got the impression when we walked into the Tribunal we had lost . The ex employee was awarded £32,000.00 which took us a long time to recover from. and nearly bankrupt us. Now I read that unfair dismissal claims usually receive £9,500.;00. so if this is true where did the huge award we had to pay come from. This was not justice at all.

    • That is very sad news Caggs. At the time of the tribunal, did you ever consider an appeal, was there an appeal process available to you?

      What advice would you give to other small business owners who may be in the same position as you once were?