UK: All Change At The Employment Tribunal

Hard pressed HR professionals know how easy it is for disgruntled former employees to make Employment Tribunal claims. It can be cheaper to reach a settlement with the employee than go to the Tribunal - even if the unmeritorious claim can be successfully defended. Canny employees know this. However, changes in procedure to be introduced very soon may now weed out poor claims at an early stage. Also a new arbitration system could make it cheaper for employers to handle unfair dismissal claims.

New Tribunal procedure rules which will operate from July include powers for the Tribunal to:

• order applicants to pay a deposit of up to £500 to proceed with an unmeritorious case, following a pre-hearing review
• award costs of up to £10,000 without subjecting a costs claim to detailed assessment
• take into account unreasonable behaviour of a party’s representative when awarding costs
• take greater control over case management, including striking out claims if an applicant does not comply with the Tribunal’s requirements concerning production of evidence

The brand new ACAS Arbitration Scheme came into being on 21st May. The scheme covers unfair dismissal claims, but not technical points such as whether a Tribunal has jurisdiction to hear a claim. The scheme is voluntary -both the employer and the employee must agree to take part.

To enter the scheme an arbitration agreement is signed by the employer and employee and endorsed by ACAS. The arbitration process is designed to be quick and relatively informal. Before the arbitration:

• the arbitrator is appointed by ACAS from its arbitration panel
• he will arrange the hearing and venue
• the parties send in written statements of case and supporting documentation - new points/ documentation may only be introduced at the hearing in exceptional circumstances at the arbitrator’s discretion
• the parties can ask for additional documents before the hearing, but the arbitrator has no power to compel production of these

The hearing itself follows a format decided by the arbitrator. Witnesses can attend but do not give evidence on oath. There is no formal cross-examination. The arbitrator questions the witnesses. The hearing is normally expected to last half a day. It takes place at a venue convenient to the parties and can even be at the employer’s premises, if the employee agrees. There is no formal legal representation at the hearing although the parties can be assisted if they wish.

The arbitrator can decide if a dismissal is unfair and can order compensation, reinstatement or re-engagement. A blow to the lawyers perhaps - the arbitrator does not need to follow strict law or legal precedent. He takes account of general principles of fairness and good practice in the workplace (although there are exceptions where EC law or the Human Rights Act 1998 applies).

A key feature of the scheme is that the hearing and the arbitrator’s decision is confidential. Once the decision is made it is final. There are only very limited grounds for challenging it and there is no appeal on points of law, except where EC law or Human Rights Act 1998 is relevant.

Whilst the scheme is limited to unfair dismissal claims it has certain attractions for disposing of some claims quickly and cheaply. It will be interesting for human resource practitioners to see how it works in practice.