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New research shows that over half of successful tribunal claims do not receive their award

19th December, 2013

Earlier this month, the Department for Business Innovation and Skills published research stating that a majority of people who were granted a tribunal award never actually received the full extent, if any, of that award.

In an effort to eradicate the problem of non-payment, the government is considering:

• Giving Employment Judges the power to order deposits from businesses who are considered at risk of non-payment;
• Issuing fixed penalty notices for late payment; and
• Publicly “naming and shaming” employers who do not to pay.

The research highlighted a problem of instances where a company has stopped trading and as such the awards they owe are not paid. If a company is insolvent, the Redundancy Payments Service can already pay certain elements of an employment tribunal award but the government now wants to extend this service to ensure claimants receive their full award.

Further findings of the research reports:

• Only 49% of claimants who had been granted an award by a tribunal had been paid the award in full, a further 16% were paid in part leaving over a third who were not paid at all; and
• Claimants with larger awards (over £5,000) reported the most occurrences of the reason for non-payment being that the company had becoming insolvent or ceasing trading. Further, 17% of claimants reported that they were unable to locate the employer in order to receive payment.

Although there is clearly a disturbing amount of non-payment, only 22% (of all claimants) pursued enforcement through the courts. There is a serious lack of awareness of enforcement procedures with only 41% of claimants agreeing that they were aware of the options open to them if their employer did not pay their award. Ministers are now looking at action to promote enforcement procedures with a view to raising awareness among claimants.

For further information and advice on enforcement of tribunal awards, please contact Helen Watson on 01244 405565 or send an email to [email protected].

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