Calls for reform and fees for claimants at employment tribunals February 2011
Posted date: 1 February 2011
The British Chambers of Commerce (BCC) is calling on the Government to reform the current employment tribunal system and to consider introducing fees for claimants.
During 2010 the number of employment tribunals was at its highest ever level, costing employers an average of £8,500 per tribunal to defend themselves.
The BCC has revealed figures which highlight the cost for employers and has said that the system is in“dire need of reform”.
It has emerged that nearly 60 per cent of employers decide to settle claims rather than continuing with a tribunal, as the average cost is significantly lower, at £5,400.
These cases are often settled through Acas, however 19 per cent are resolved privately.
The BCC has found that more than half of employers decide to settle claims to keep costs low, while 25 per cent did so because it was convenient.
Despite provisions which allow employers to claim back costs, if facing unmeritorious claims, the number that take advantage of this is very small.
Dr Adam Marshall, Director of Policy and External Affairs at the BCC, believes that the employment tribunal system is too slow and is weighted in favour of employees.
He argues that small and medium-sized employers feel that the current system creates risk and uncertainty, which acts as a barrier to job creation.
“We urge the Government to review the current system and consider introducing a fee for claimants to discourage spurious and baseless claims,” said Marshall.
He goes on to argue that it is perverse that businesses are forced to settle rather than fight claims due to cost.
Charles Rae, Senior Associate at Pinsent Masons LLP, said:
“The introduction of a refundable fee when bringing a tribunal complaint may go some way to discouraging speculative or spurious claims, as it addresses the ‘I have nothing to lose’ mindset.
"However this, rightly, needs to be balanced against the risk that it will discourage genuine or well founded claims.”
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- February 2011
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