The Coalition Government has launched a consultation on ways to encourage early resolution of workplace disputes. Although there is a clear agenda to cut the cost of running the employment tribunal service, which has seen significant rises in claims during the recession, the Government believes that changes to increase labour market flexibility will encourage employers to take on more staff, thereby stimulating the economy.
The consultation document invites comment on a range of options, broadly grouped around three themes; encouragement of early settlement without litigation; streamlining of tribunal procedures; and introducing costs penalties for both employers and employees to encourage compliance by employers and discourage frivolous claims by employees. One of the most widely reported ideas is to increase the qualifying period of service for unfair dismissal claims from 1 year to 2 years, which the Government estimates will result in a reduction of some 3,700-4,700 in the number of claims presented to the employment tribunal each year.
Another suggestion which has proved particularly controversial is to require employees to pay a fee or deposit when submitting an employment tribunal claim. Although it is argued that this will deter individuals from bringing weak or “tactical” claims in the hopes of an early settlement by the employer to avoid legal costs, there is also concern that such up-front costs will deter low waged employees with strong claims from making claims, effectively denying them access to justice.
Consultation closes on 20th April 2011. For a copy of the full consultation document please click the link below.