10th November, 2020
Employment Tribunal sees surge in claims against an already backlogged process
Prior to COVID-19, the Employment Tribunals were already seeing significant delays with progressing cases, with some tribunals and areas impacted more than others.
We have seen many claims already taking in excess of a year to reach a final hearing, leaving long gaps between the termination date and/or acts complained of and the conclusion of the claim. Unfortunately, the Employment Tribunals are continuing to see a surge in claims owing to the current economic climate.
These claims are further placing pressure on an already backlogged system which, as of 20 September, stood at 39,836 cases waiting for a final hearing.
The first lockdown in the spring saw an abrupt halt to ‘in-person’ hearings entirely with all cases due to be heard between 23 March and 26 June 2020 being postponed. Some cases were converted to a telephone preliminary hearing for case management, but not all cases have yet been re-listed for a final hearing. This means many cases still do not have a hearing date, despite having been lodged more than a year ago.
The tribunals now have the unenviable task of trying to ensure all postponed cases have new hearing dates and that all new claims in the system are given directions and hearing dates, with priority given to postponed hearings.
Since hearings restarted in June, the Employment Tribunals have adapted to a ‘new normal’ with hearings now taking place both in person and by way of video conferencing. The second lockdown in November had fewer restrictions and allowed tribunals to continue operating in this way.
HMTCS also published a Civil, Family & Tribunals Recovery Plan on 9 November 2020, which outlines the plan on tribunals to increase their capacity to hear cases during COVID-19 and measures already put in place to help courts and tribunals recover as quickly as possible. The four key pillars of approach affecting Employment Tribunals are:
1.to maximise the capacity of the judiciary by increasing sitting days;
- re-opening of tribunals and courtrooms, where it is safe to do so;
- continuing the use of remote hearings with increased staff support and guidance for users; and
- increasing staff numbers to support delivery and adapting to the new normal way of working.
What does this mean for employers facing tribunal claims?
Notwithstanding these efforts, with cases now being listed far into 2021, some even 2022, employers with pending tribunal claims need to bear the delays in mind and plan ahead. Significant delays in the process can often impact evidence with documents being lost or destroyed, key witnesses may no longer be in the business or willing to help and ultimately the delays can impact memories, particularly where the case is heavily reliant on witness evidence rather than documents. Early preparation of key documents and witness evidence and keeping witnesses on board may be critical to the chances of successfully defending many claims.
With the significant number of redundancies and uncertainty over the economy, many claimants (particularly in certain sectors) may find it more difficult than normal to obtain new employment leading to potentially higher loss of earnings (subject to statutory caps) or unrealistic requests of settlements from claimants.
What are the alternatives to tribunals?
With significant delays expected, there may be a greater emphasis on businesses to avoid what can often be lengthy and costly legal proceedings.
A focus on out of court settlements may be prudent as a means of limiting the financial cost towards an employer in the event that a claim is undertaken against them.
There are a number of settlement options, including options available to avoid tribunal proceedings entirely and options once proceedings have commenced but prior to a final hearing. The options and timing of out of court settlements often depend on the parties expectations and in many cases take place after a case has been issued and both parties have seen the other sides’ arguments and evidence. Some settlement options include:
- Settlement Agreements
Settlement Agreements are legally binding documents between parties which can prevent any future claims the employee may have against their employer. It is usual for the employer to offer a financial settlement and in return the employee waives any and all future claims against the employer that they have or could have, save for some specific reasons relating to pensions or unforeseen medical issues. Settlement Agreements have the benefit of being able to record other agreed terms that would not ordinarily be awarded as an outcome to a tribunal claim.
Settlement agreements therefore can be a useful tool for an employer in preventing or ending any disputes which can occur and allow both parties to move on amicably.
Many employers use settlement agreements prior to the employment terminating but we strongly recommend employers take legal advice before approaching a settlement agreement to avoid claims of getting it wrong.
- Early ACAS conciliation
Claimants still need to contact ACAS as part of the Early ACAS conciliation process before lodging a claim. This therefore provides a further opportunity to explore settlement if a settlement agreement has not been reached previously between the parties. Due to the significant increase in claims, ACAS is however stretched at the moment which may impact how quickly they can assist the parties but ACAS offers a cost effective and early solution to settling claims provided both parties agree to participate in the conciliation process.
ACAS can also extend the early conciliation period if agreed by both parties which can be beneficial if negotiations are ongoing.
- Judicial mediation /mediation
Judicial mediation is offered in many cases, provided the case has been assessed by a Judge as being appropriate and both parties consent. Judicial mediation can take place by way of video conferencing and can be a very effective means of settling cases. Judicial mediation can be a successful means of settling a claim early on in proceedings and prior to incurring significant legal costs. It offers an opportunity to agree terms that may otherwise not be awarded at a final hearing, but may be important to the parties.
Parties may also agree to mediation through a third party mediator rather than an employment Judge. There is currently no cost to the employer to take part in judicial mediation (except for representation costs) but costs of engaging a third party mediator can be more expensive but is still usually cheaper than progressing to a final hearing if a settlement can be reached. Third party mediation is also a useful alternative if the option of judicial mediation is left too late in the employment tribunal and/or the case is not deemed appropriate for judicial mediation.
- Ongoing ACAS conciliation
ACAS can continue to play an important role throughout proceedings and despite a claim and an Early ACAS certificate having been issued. Many cases can still settle during any stage of proceedings by way of a COT3 Agreement through ACAS.
- If disputes arise in the workplace, consider whether it would be appropriate to enter in a Settlement Agreement at an early stage to avoid future legal proceedings.
- If legal proceedings are issued and are to be progressed to a final hearing, consider early preparation of the case to avoid issues with documents or key evidence being lost or destroyed, witnesses leaving the business, or memories fading.
- If proceedings are issued, consider the various options of settlement throughout the various stages of the case to avoid lengthy delays and time consuming and costly legal proceedings and hearings.
Partner and Head of Employment
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