Prevention is better than cure

A huge rise in Tribunal cases over the past year has confirmed employers’
worst fears about the effect of changes in the law. So what should be done now
to turn this alarming tide?

Jadine Riley
Senior policy adviser, CBI

The evolution of Britain’s compensation culture has been causing business
concern for some time. The number of actions brought by individuals against
employers has risen by 27 per cent in the past year to more than 167,000. The
amount of employers’ time and money tied up in addressing claims is becoming
substantial.

Of course, most cases are legitimate, and Acas does an outstanding job in
helping to resolve more than 70 per cent of these before they proceed to a full
hearing. But we are worried about the sheer volume of claims, some of which are
vexatious and some of which are not best resolved through costly litigation.
The costs and inconvenience of fighting even a weak claim can be so prohibitive
that £1,000 or so to make the problem go away is a preferable option. Those who
do fight can run up huge costs, with little or no hope of recovery when they
are successful.

This is why earlier this year we put to Trade and Industry Secretary Stephen
Byers a number of proposals that should help offset the rising number of
unjustified legal claims while still offering justice to employees. This,
coupled with more finely tuned case management, should ensure that tribunals
are seen as for administering justice, not for playing games or for individuals
to have a punt.

We want ministers to ensure full hearings take place only when there is no
reasonable alternative. More must be done at an early stage to discourage
claims with little chance of success, before companies invest in a defence.
Improving application forms so complaints are more clearly stated at the outset
– removing the opportunity for the ambiguous "I was unfairly
dismissed" type of claim – would be a good start.

The tribunal service should be able to advise applicants on what a claim
should look like. If this still fails to produce a clear statement, a
pre-hearing should be held to explore whether a case exists – again, before the
employer is required to respond. Tribunal chairs should make better use of the
power to require a deposit if it looks as if the claim will fail and, where a
weak case does proceed, costs should be awarded more often.

We also believe the Acas Alternative Dispute Resolution scheme will play an
important role in resolving straightforward unfair dismissal claims, and look
forward to its introduction later this year.

Ian Farrand
Director of personnel, Nottingham Trent University

We went from 1989 with no tribunal cases at all, but in the past two years
we have had a growing number – about half a dozen at the moment. In one case,
we dismissed a security officer who took a hammer to a photocopier. The
individual is convinced we will settle – he knows it is likely to be cheaper
than going to tribunal. Morally, however, that is not the thing to do. I agree
some of the measures for weeding out cases could work. But I still think
management development is vital. We need to make sure our managers are up to
speed with good employment practice and more skilled in resolving problems at
an earlier stage. It is time businesses started acting more proactively.

Andrew Powles
Senior manager, employee relations, Nationwide Building Society

The rise in cases could affect the adult relationships that exist between
managers and staff: managers become so paranoid they are frightened to act
without referring to the personnel department for "legal advice". I
think even good employers now have something to fear from employees who think:
"Let’s have a go." Pre-hearings and deposits should be used to weed
out weak claims. But I think much of this is caused by law firms that rake up
business on a no-win, no-fee basis. Perhaps the Law Society needs to give
guidance on ethical practice, because at the end of the day someone has to pay
for it all.

Caroline Lewis
HR director, Criterion Asset Management

In my time with this company I have not had any tribunal cases at all. Maybe
I have just been fortunate, but I think if managers are given the proper advice
and guidance there shouldn’t really be a problem. I did have cases when I was
with Forte, but I found the vast majority could have been avoided if managers
had followed the proper procedures. I don’t think it is necessary to bring in
new measures to deter claims. It is about making sure everybody knows what they
can and cannot do. I am sure people do bring vexatious claims, but if they
haven’t got a case, they haven’t got a case.

Ann Currie
Staff relations manager, Standard Life Assurance

Like many employers we have experienced an increase in the number of
employment tribunal claims, some of which were very weak and were subsequently
dropped. Each claim, whether valid or frivolous, requires a significant
allocation of resources to investigate fully, and unfortunately, as long as
there is no penalty for employees bringing frivolous claims, this wasted effort
will continue. Any measures which help speed up the hearing of genuine claims
and prevent employees abusing the system are welcome. This would help balance
the burden on employers, who are already expecting a further increase in claims
as a result of the raft of new employment rights coming into force.

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