Trials and Tribulations in UK Employment Tribunals

In July last year, fees were introduced for employees to bring claims and the Ministry of Justice has just published Tribunal statistics for October to December 2013 (the first full quarter since the introduction of the fees) which show that in that time, employment tribunals received 79% fewer claims than the same quarter in 2012 and 75% fewer than in the previous quarter.

The number of claims brought by single individuals has dropped by 64% compared to the same period in 2012. There has been a general decline in claims over the past seven years, but even with that trend, it is clear that this sudden huge drop in numbers of claims is not merely part of a gradual trend. This is clearly a result of the introduction of fees, which are not cheap—usually £250 to lodge a claim, with an additional £950 to have a hearing.

Another change that is due to take effect on April 6, 2014 is the introduction of the ACAS early conciliation scheme. For those unfamiliar with UK Employment Tribunals, ACAS is the statutory body whose job it is reach settlement in and conciliate all kinds of employment related issues. They have for a long time had a duty to seek to settle Employment Tribunal claims once they are lodged and active, but this new scheme is designed to head claims off at the pass and settle them before they are lodged.

The new rules place a mandatory obligation on employees to notify ACAS of their intention to bring a claim before they do so. When this notification is received by ACAS, a process called ‘Stop the Clock’ takes effect, which is a period of up to one month (with a potential two week extension) during which the employee’s time limit for bringing a claim (usually three months from the end of employment) is paused to allow for the parties to explore whether settlement is possible.

If both parties agree to conciliate and an agreement is reached, the claim is then settled via a COT3 agreement (which is effectively a short-form settlement agreement prepared and sent out by ACAS, which waives all claims). If agreement is not reached, either because it is not possible in the conciliation officer’s view or the month expires and agreement has not been reached, then ACAS issues a certificate to the parties confirming that the employee has notified ACAS as required and enabling the employee to lodge a claim in the Employment Tribunal. Employees have a minimum of one month from the issue of the certificate to lodge their claim which means that in some cases, the time frame for lodging a claim could be extended by up to an additional two months.

And if that early conciliation fails and your employee is not put off by the fees, the recent case of Gosain v. Punjab National Bank (International) Ltd. is a timely reminder of why UK Employment Tribunals are best avoided by employers. In this case, prior to her resignation, Ms. Gosain attended both a grievance hearing and a disciplinary hearing with her employer. She secretly recorded on her mobile phone both the public discussions at the hearings and the private conversations of the individuals when she was not in the room.

Ms. Gosain subsequently brought claims of sexual harassment, sex discrimination and constructive unfair dismissal. When she disclosed the covert recordings, her employer objected to the admissibility of the private contents of the recordings during which the comments allegedly included the Managing Director giving an instruction to dismiss Ms. Gosain, and the Manager hearing the grievance saying that he was deliberately skipping the key issues raised by Ms. Gosain regarding her not being allowed a proper lunch break and issues concerning her pregnancy.

The Employment Tribunal held that the recording, whilst distasteful, was still admissible and the Employment Appeal Tribunal upheld that ruling. The EAT held that the recordings were admissible as evidence and it would be for the Employment Tribunal to assess the relevance and importance of the recordings and their impact on the issues which it had to determine.

This is certainly consistent with our experience of UK Employment Tribunals, in that they will allow evidence through even if it has been gained through underhand means or disclosed in a less than fair manner. The Employment Tribunal may be unimpressed with the behavior and that could prejudice their view of the employee somewhat but, of course, that balances against the damage caused to the employer’s case in the meantime. To the extent possible, employers therefore need to take care to ensure that any discussions in meetings of that nature are not covertly recorded by mobile phones etc. and that employees are aware that this behavior is prohibited—and even better, keep any “private” discussions out of those meetings altogether.

So, whilst it does look like the number of Employment Tribunal claims has been significantly impacted by these changes, employers need not breathe too deep a sigh of relief. If an employee is convinced enough of their case to pay the fees upfront, they may be more likely to pursue that case all the way. If the employer does then end up in Employment Tribunal as a result, it needs to be aware from the outset that it will be under close scrutiny and what had been thought to be an innocent “private” discussion or “confidential” internal email can suddenly become a very public “smoking gun” which ultimately hands the employee his or her case—a factor which, if known, may have some considerable bearing on whether the employer engages in the early conciliation offered by ACAS and on the eventual settlement price.