Changes to the Employment Tribunal System

The Resolving Workplace Disputes consultation took place last year and the Government's response to the consultation was published on 23 November 2011. Ministers invited Mr Justice Underhill to undertake a fundamental review and recommend a revised procedural code for employment tribunals by the end of April 2012.  The revision should enable workplace disputes to be resolved more quickly, reduce pressure on the employment tribunal system and save money for employers and the taxpayer.

Some changes came into force on the 6^th April.  New employees now need to be employed for two years to gain the right to claim unfair dismissal.  The amount of a deposit that an Employment Tribunal can order the claimant to pay for them to be permitted to continue with their claim (deposit order) increased from £500 to £1,000.  Unfair dismissal cases can now be heard by a judge sitting alone.  Witness statements may no longer be read out loud and witnesses expenses may be payable by the losing party.  The amount of costs an employment tribunal is able to award has risen from £10,000 to £20,000.

The aim of these changes is in part to discourage “frivolous” claims.  However claimants can and often do instruct “no win no fee” solicitors so it is uncertain how effective these changes will be.

The overall average award made by Employment Tribunals was £14,222 in 2010-11.  Small to medium sized businesses may find it more difficult to keep up with employment law.  Directors’ & Officers’ Liability Insurance including an employment practices liability extension will provide that added peace of mind. If you would like any information about this and other insurance policies, please just get in touch.