News

April 21, 2011

Tribunal reforms won’t deter weak claims, warns IoD

Government reforms of the employment tribunal system are “too timid” and won’t do enough to deter employees from making weak claims, the Institute of Directors (IoD) has warned.

During a consultation on the proposed reforms, which closed on 20 April, the IoD said that the planned changes would not result in a significant reduction of claims.

The Government proposals include increasing the qualifying period for employees to be able to bring a claim for unfair dismissal from one to two years, requiring all claims to be lodged with Acas’ Pre-claim conciliation service (although either party can refuse to go through the conciliation process), and introducing fees for users of employment tribunals.

IoD spokesman, Edwin Morgan, said that the Government would need to go further with the reforms to significantly reduce claims and the associated costs to business in management time and lawyers’ fees.

“The Government wants to make free pre-claim conciliation available to everyone, but we want it to be compulsory for them to go through conciliation before they go to the next stage,” he said.

“We also want employees bringing cases against employers to be charged a mandatory deposit to deter spurious claims,” added Morgan. “The Government proposal only says it is going to consult on fees sometime soon, and the way it is worded implies that any user, including employers, may have to pay fees, and possibly only if they lose the case.”

Confederation of British Industry (CBI) chief policy director, Katja Hall, agreed that more workplace disputes should be resolved before they reach tribunal.

“Surely it’s in everyone’s interests for cases with merit to be heard quickly and settled, while weak claims are swiftly identified and weeded out,” she said.

The CBI has called on the Government to introduce a system where a fee is charged in proportion to the claim being made, to ensure only reasonable claims are brought to tribunal.

A spokesman for the Department for Business, Innovation and Skills said that it has taken on board the business groups’ recommendations made during the consultation and will announce its response later this year.

• Conciliation prevents three-quarters of employment tribunals