Employment Tribunal fees were declared unlawful in a landmark ruling by the Supreme Court on 26th July 2017, in a decision that has been cited as the most important judgement in employment law in the last fifty years.
There is the potential here for major ramifications for employers and business owners, with the ruling meaning that employees and workers can now bring legal action against their existing or former employers, without having to pay up to £1,200 in fees to the Employment Tribunal or the Employment Appeals Tribunal
Furthermore, anyone who has previously paid such fees are entitled to be reimbursed by the Government, in a move which is set to cost up to £32 million in claims
This decision also means that the Government will need to consider and set out guidelines for any contentious matters arising from these fees including:
What happens if the Employment Tribunal ordered the employer to reimburse the fee to the Claimant, including if the tribunal ordered this but the employer failed to pay; or perhaps if fees were reflected in an amount paid by the employer under a settlement agreement.
Will Claimants be able to reinstate claims which were dismissed for non-payment of fees?
Will the Employment Tribunal allow late submission of a claim (outside the three month time limit) if the Claimant was deterred by the fees from making a claim in time?
Tips for Employers
Whilst this can be concerning for business owners, they are not entirely vulnerable to the threat of increased legal claims and there are measures that can be put in place to safeguard against the threat of employment tribunal claims.
Deal with issues speedily – whilst this may sound like common sense, dealing with issues quickly and in a fair manner can help to avoid legal action. It is important to give all employees the ability to voice any concerns in a non judgemental manner.
The ACAS Code of Practice can help in the effective resolution of workplace issues, and furthermore can be used to reduce compensation pay-outs to employees by 25% should an issue result in a tribunal.
Robust contracts – ensure that your contracts of employment are effectively drafted when considering unacceptable behaviour at work – examples should be clearly defined, with the consequent actions also explained thoroughly. If an employee has agreed to these terms, then a challenge against such would be ineffective.
Clearly defined roles – when recruiting for new staff, it is imperative to ensure that job specifications and guidelines are clear. For example, if ‘out of hours’ working is required from time to time, this should be clearly stated. Should someone’s personal circumstances change and they are unable to do work at certain times, but was not made aware of this at the start, then this could lead to proceedings for discrimination, harassment and breach of the Working Time Regulations 1998.
Mitigate the Risk – whilst employees can’t be stopped pursuing legal action against their employer, the risk of such can be lowered by maintaining a happy workforce – happy employees who feel valued are much less likely to want to take action against their employer. Recruitment processes should be effectively managed to ensure you recruit the right people into the right roles, and whose values fit that of you and your business.
Furthermore, training and structured appraisal processes are just a few examples of how issues can be uncovered and nipped in the bud before they become problematic.
Government proposals in relation to reimbursement of these fees are expected imminently (September 2017) – Keep any eye on Farleys’ HR & Employment Updates and website for more news and how this may affect your business.
If you require any assistance with any of the above please contact Farleys Employment Law & HR team on 0845 287 0939 or email us here.