“Have a go” employment tribunal claims quashed

Brinkmanship has long been a feature of the Employment Tribunal scheme. Hereto the only obstacle to an employee making a Tribunal claim has been their inclination to do so. Therefore even if the employer has had a fair reason for a dismissal and has followed a sound procedure the employer could still face a tribunal claim. The ex-employee has had the unfettered right to test his or her case in court, at the employer’s expense.

A typical unfair dismissal case could cost an employer £10,000 to defend once the employers opportunity costs are added to legal costs. Complex cases can cost very much more;  a recent 20 day case cost over a quarter of a million. The employer cannot assume that they will be able to reclaim any costs from an ex-employee, even when the ex-employee has the means to pay. In the case just cited the employer got back just a third of their costs.

The pragmatic answer in most cases is for the employer to reach a settlement with the employee whereby the employee surrenders their right to go to court in return for a sum of money. Employer Solutions has negotiated numerous such settlements over the years, saving employers tens of thousands against the cost of fighting claims which could have been successfully defended.

Now, before an employee, or ex-employee, goes to court they will have to think carefully. By being required to make a deposit first, the rules of the game have been changed. The fees are not unfair. Fees have to be paid in other areas of litigation,  for example to bring a small claim in the County Court.

This change is not something of which employers can take advantage directly. They would be unwise to start taking short-cuts or other risks. But what they can do, if they have done everything expected of them, is to sleep a little sounder at night.

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