A number of reasons have been cited for this rise, including the introduction of the ACAS code on disciplinary issues creating uncertainty for employers, the increasing popularity of no-win no-fee claims and the current economic climate of high unemployment, making disputes more difficult to resolve.
A number of legislative changes in recent years have given employees more rights and provided them with the impetus to make claims, as their employers fail to adhere to the changes.
The Working Time Regulations (1998) give employees the right to a limit of an average 48 hours working week and a right to 11 hours rest per day. While employees are still able to opt out of the Regulations, they have been cited as a reason for the increase in employment tribunal claims in recent years.
The Employment Act 2002 provided that, prior to 6 April 2009, employers had to follow a three-step procedure when dealing with dismissal or grievance matters. Failure to do so resulted in automatic unfair dismissal of the employee and thus many employers have faced claims for simply not following a procedural step when dismissing staff or dealing with staff grievances. The Employment Act 2008 has repealed the statutory dismissal and grievance procedures and a new ACAS code has emerged, which again stipulates steps that employers need to take when dealing with dismissals.
The increase in employee awareness of their rights, coupled with the new trend for aggressive litigation, is a significant cause of the overall increase in claims. Solicitors and other HR-style consultants acting on a no-win no-fees basis are attracting clients to make claims when before they would have been reluctant to do so. The allure of a no-win no-fee deal has meant employees are becoming less reluctant to settle claims as they are lured by the potential money they could win at tribunal with no apparent risk if they lose.
The introduction of age discrimination regulation and maternity rights will mean the number of claims may well increase further. Employers must make sure they adhere to the new legislation.
How to avoid potential claims
The current economic climate has meant many companies are now facing redundancy situations in the workplace. These situations could potentially lead to a surge of unfair dismissal claims as employees feel their role was not technically redundant or that the redundancy procedure followed was unfair. The impact of this on the number of employment claims being made has not been reported by the Tribunals Service but it seems apparent that it may well cause an increase in claims being made in the upcoming months.
To avoid potential claims, employers should ensure they have proper dismissal (including redundancy) procedures in place. This includes writing to the employee, advising them they are at risk of redundancy, including the criteria that will be used in a redundancy situation. A series of consultation meetings should then follow, giving the employee the right to be represented by a work colleague or trade union representative. Suitable alternative employment should be discussed before the final decision to make the employee redundant is put in writing to the employee, giving them the right to appeal the decision. The effort it takes to implement the correct procedure will far outweigh the potential cost of not doing so and employers should therefore try to keep up-to-date with current legislation so as to avoid potential claims. Employers should also be aware that there are collective redundancy obligations where more than 20 employees are proposed to be made redundant from the same ‘establishment'.
If employment claims are still pursued it is advisable in some cases to try to negotiate and settle claims to avoid the cost of attending a tribunal and briefing lawyers as well as avoiding the media publicity a reputed case can bring.
Rebecca Fox is a solicitor at Matthew, Arnold & Baldwin