Employment tribunal costs are stacking up and becoming a
serious burden for employers, according to research by the CBI.
It shows that the cost of tribunals for business has risen
by 50 per cent in two years. The legal, management and recruitment expenses for
UK businesses rose from £426 million in 1999 to £633 million in 2001.
Over the past decade basic tribunal costs have risen four
fold while the number of tribunal claims have trebled to 130,000 cases.
The CBI is calling for employment tribunals to be a last
resort for workplace disputes.
Digby Jones, director general of the CBI said, “While most
cases are genuine, firms are worried that a punt-for-cash culture is taking
hold. They are often faced with the choice of successfully defending a spurious
claim, paying a big legal bill and using up valuable management time, or
stumping up a few thousand pounds to make it go away.”
The CBI based its findings on Government figures which
estimate that each tribunal application costs the company £2,000 in legal and
management expenses. The average cost of recruiting a new employee is £3,500,
which the CBI estimates to be necessary in at least 75 per cent of cases.
By Katie Hawkins