The reform carousel
Date: 25 February 2011
Authors: Stephen Levinson
Issue: Vol 161, Issue 7454
Categories: Features, Employment
Those familiar with some history may be forgiven for thinking that the government’s recent consultation paper, Resolving Workplace Disputes, was written by amnesiacs. For an institution less than 50 years old employment tribunals have been much reviewed.
There was Justice in 1987; the green paper, Options for Reform in 1994; Fairness at Work in 1998; the Leggatt Report in 2001 and, in 2002, the very thorough report of the Employment Tribunal System Taskforce (ETST). There was a white paper in 2004, and in 2007 the Ministry of Justice chipped in with Transforming Tribunals. Then again in 2010 the secretive Tribunal Steering Board came up with a Report on Consistency. What is notable about the current offering is that although many of the 13 ideas proposed have appeared before in one or more of those reports no acknowledgement of this appears anywhere.
Alarmingly the only mention to previous work on tribunals is to the Gibbons Review of 2007—a piece of matchless political expediency—which told the world what it already knew (that the statutory procedures introduced in 2004 were a disaster) and produced the fatuous proposal that “employment law should be simplified” without giving one suggestion of how this was to be done.
Does this matter?—possibly not as the proposals can still be reviewed on their merits. However the consultation paper also reveals a considerable lack of familiarity with the way employment law works in practice. For example what employment lawyer could not answer the question “To what extent are compromise agreements used?” The lack of any historical perspective and the lack of experience, taken together, cause concern given that the same authors will soon be deciding what new rules to propose to Parliament.
Current pressures
This is not to say that the paper is not well meaning or that all is well with the present situation. The consultation is the result of much pressure from employer organisations protesting at what is perceived as the inefficiency of tribunals, the cost of the system, the length and complexity of hearings and the ease with which claims can be brought. There is anxiety that these perceptions are influencing the willingness of small and medium-sized business to create employment. Many lawyers share these perceptions and they have also voiced concerns at the declining quality of service that tribunals deliver. Some of the proposals are designed to operate more on the level of perception than achieve a real impact.
In addition, the cost of administering the system is born by the taxpayer and the cost is increasing with the rise in the number of claims. This driver is the same as that which produced the failed 2004 Regulations and is exacerbated by the undeniable need to reduce government expenditure. The need to save money for government and the acceptance that business believes the system is weighed more in favour of claimants are the reasons given in the impact assessment for these proposals.
There is no reason why the tribunal system should not bear its share of the national need for frugality. But it would be sensible to assess the various proposals against the vision many have for employment tribunals. The extent to which they detract from these standards ought to be the criteria against which they are judged. It seems doubtful from the consultation paper that this exercise has yet taken place.
Valuable ethos
A fundamental and obvious point is that for the last fifty years it has been accepted that a process separate from and different to the civil courts should be used to adjudicate workplace disputes. The Donovan Commission in 1968 wanted tribunals to deal with “all disputes arising between employers and employees from their contracts of employment or from any statutory claims they may have against each other”. This was an overstatement as there has never been a time when all such disputes were dealt with by tribunals. However the jurisdiction has grown enormously over the years and the resultant strains have led to many complaints of “legalism” and that the original objective of providing a readily accessible and cost effective means of redress with a minimum of formality and delay were being lost.
It was these complaints that led to the 1994 Green Paper and to the investigations of the ETST in 2002. The ETST concluded that expectations of informality had to be adjusted to accord with the new reality but that as much as possible of the original ethos of tribunals should be maintained. They set out this vision for the future of tribunals: “The Employment Tribunal system should deal with those employment issues referred to it in a just, fair and proportionate manner by being:
l Even handed and responsive to the needs of its users.
l Accessible and understandable.
l As fast as reasonably practicable.
l Reliable, consistent and dependable and properly resourced and organized in an acceptable fashion.”
In addition the ETST recorded how much users valued certain unique aspects of the service such as the access to ACAS and representation within the system of both sides of industry. This last point echoed the Leggatt Report, which said (at para 12), “one of the defining characteristics of the Employment Tribunal is that it has wing members who bring experience of both sides of industry. Users argue strongly that having members with that experience participating directly in the decision-making process leads to better decisions and that a panel including both lawyers and non-lawyers is more accessible. We agree and recommend that three-member panels should remain the norm for ET cases.”
Leggatt also rejected the idea that tribunals should become courts. This in turn was accepted by the 2004 white paper Transforming Public Services: complaints, redress and tribunals which supported the balance and expertise multi-member panels can bring and considered that a principal reason for aligning employment tribunals with other tribunals rather than courts was that this was the best way of preserving maximum informality and accessibility. This last thought was also repeated in a speech Mr Peter Handcock, the designated head of the unified Courts and Tribunal Service, prepared for the annual conference of the Administrative Justice and Tribunals Council in 2010 when he claimed that the Ministry of Justice was committed “to preserving and protecting the distinctive nature of tribunals, guarding against increased judicialisation”.
The proposals
The new proposals will now be evaluated against these established benchmarks.
Pre-claim conciliation
Pre-claim conciliation through ACAS encouraging conciliation before the formal tribunal process. There is nothing inimical to the nature of tribunals in this idea. It will require considerable resourcing, and may create bottlenecks but is worth trying. It could work for some multiple claims.
Stronger case management
Stronger case management with strikeouts without a hearing, increased deposit orders and a higher lid on costs awards. These powers may be reasonable with represented parties but raise difficult issues and add complexity particularly for unrepresented parties. There is also the manifest reluctance of tribunal judges to use costs powers they already have. The idea of referring solicitors who unreasonably threaten costs applications to the Solicitors Regulation Authority would introduce unwelcome satellite litigation.
Provision of more information on the ET1
This is again less of a problem for represented parties. It is often very difficult at an early stage for claimants to know what loss they will suffer but in principle this is a reasonable proposal.
Settlements, statements & expenses
The Scots system for settlement offers is proposed which does not require a payment to be made, merely an offer on paper. No value seems to have been attributed to a finding that a dismissal was unfair or that discrimination has occurred. This runs counter to most authority. However, this does not sound unduly complex and may be worth trying.
Witness statements to be taken as read: this does align tribunal process more with courts but the uniformity would be welcome and the practice is already adopted in many tribunals in England and Wales. Again it advantages represented parties.
Withdrawing payment of expenses for witnesses: this will have no impact on the number of cases, many witnesses are quite unaware the facility is available. It reduces accessibility and the annual saving predicted is small (c £300,000) but in an era of cuts this is probably an acceptable change.
Judges sitting alone & legal officers
The most damaging proposal is that judges alone should hear unfair dismissal cases. It cuts across all the perceptions of what gives tribunals their special ethos. It is likely to increase the legalistic nature of the process and seems to be a complete surrender to judicialisation. It is an appalling idea.
Introducing legal officers to deal with interlocutory work is an old idea, which would be welcome. It would be wholly unacceptable to ask administrators to deal with what are judicial functions (hinted at in the paper). It may speed up processing cases. The additional costs would be considerable which makes this the least likely idea to go ahead.
Elaborating the overriding objective
Looks like nothing more than an excuse to cut back on resources allocated to individual cases. It is likely to offend against ideas of accessibility and cases being properly resourced.
Fees
Fee charging: this would be a populist move for respondents and so would address some perceptions about the system. It aligns practice with that of courts. It would reduce accessibility. The devil would be in the unrevealed detail.
Increasing the qualification period to two years
This is a return to the position before 1999. It does affect perceptions but may be a reasonable move. The annual number of cases affected is less than 5,000. The risk is that it will encourage more cases to be squeezed into other jurisdictions where claims can be brought from day one.
Penalising employers & calculating awards
Penalising employers looks like an overt balancing proposal to set against the political argument that most of the other proposals impact claimants. In that sense it may be said to be a contribution towards even-handedness. It seems acceptable to move towards the consumer prices index rather than the retail prices index in the current climate. However, where the proposal calls for greater discretion expect that to be code for not increasing awards as happened for many years to capped compensation for unfair dismissal.
Missed opportunities?
There is nothing here about extending the contractual jurisdiction, which would avoid duplication of process. Many also feel that removing the cap on compensation for unfair dismissal would result in a reduction of more complex discrimination and whistleblowing claims.
Stephen Levinson, solicitor & partner at RadcliffesLeBrasseur.
E-mail: Stephen.Levinson@rlb-law.com
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