News

Unfair Dismissal Claims

It has been confirmed that the qualifying period needed for employees claiming unfair dismissal will be increased from one year's continuous service to two with effect from April 2012. The reason for this is that it is hoped that it will boost employment if employers feel less exposed to the risk of claims.

However, employers must remember that employees with less than two years' continuous service will still be able to claim unfair dismissal where their dismissal is proven to be connected to the employee asserting their statutory rights (e.g. to the National Minimum Wage or maternity leave), raising health and safety concerns or whistleblowing or where the dismissal is connected to a transfer under the TUPE Regulations. They will also be eligible to bring other claims including discrimination.

In any event, it is important that employers have in place probationary periods or appraisal systems that enable them to monitor their employees in the early months and deal with employees who demonstrate a poor attitude to their work/employer or do not perform well are dealt with long before they become eligible to claim unfair dismissal.

Employment Tribunals

ACAS

It has been proposed that complaints will have to be referred to ACAS who will then offer a period of conciliation of up to one month in order to resolve the complaint before a claim is issued in the Employment Tribunals.

Alternative Procedures

It has also been proposed that certain types of claims will be dealt with in more efficient ways than the traditional Employment Tribunal hearing with a three person panel. For example, claims for unlawful deductions from wages may be dealt with under a rapid resolution scheme based on a review of documents rather than a full hearing and unfair dismissal claims may be dealt with by an Employment Judge sitting alone instead of with two wing members.

Costs

The Employment Tribunals currently have the authority to order one party to pay another party's legal costs up to a limit of £10,000. This limit will be increased to £20,000 from April 2012. However, as any employers who have been through an Employment Tribunal process will already know, it can be difficult to obtain an order for costs and so this increase may have little impact.

Fees

Currently, individuals bringing a claim through the Employment Tribunals do not have to pay fees to the Employment Tribunal and rarely have to pay their opponent's legal costs if their claim is unsuccessful. The reason for this is to ensure that individuals have access to justice in employment cases regardless of their financial means, but the result is that many individuals bring nuisance or blackmail type claims in order to seek a financial pay out from a former employer who may not have the time or financial resources to defend the claim.

It is proposed that a fee structure is to be introduced to the Employment Tribunals to slow the tide of these claims. Little detail has been issued yet, but it is suggested that it will cost an individual between £150 and £250 to commence a claim and a further £1,000 to take that claim through to a hearing. These fees may be means tested such that they would not be payable in every case and would be refunded if the claim is successful.

Penalties

It is proposed that the Employment Tribunals will have the power to levy a financial penalty on employers who lose claims and who are considered to have acted negligently, maliciously or otherwise unreasonably. This penalty is likely to be a minimum of £100 and a maximum of £5,000 and will be payable to the Exchequer.