HR · 14 December 2017

Employment tribunal claims increase hugely since fees abolished

dispute
The number of claims for unlawful deductions from wages has increased

The number of employment tribunals went up 64 per cent overall in the two months after fees were abolished this year, government data has shown.

The increase is the highest in the UK for four years, demonstrating that workers have become more willing to bring claims to resolve employment disputes now that they don’t have to pay fees of up to £1,200.

The first official employment tribunal statistics to be published since July 2017, when fees were abolished, show that claims for unlawful deductions from wages – which had all but disappeared as a result of fees – had resurfaced.

Read more: The difference between a court and a tribunal

From a total of 549 in July this year, the number of claims relating to unlawful deductions from wages increased to 2,926 in August and 2,027 in September.

The overall number of employment tribunal claims went up to 3,045 single claims in August and 2,639 in September. The significant increase in August is thought to be because of claimants rushing to submit claims before reaching the time limit to do so.

Employment partner at national law firm Irwin Mitchell, Sybille Steiner, said that another set of quarterly figures would be needed to determine whether the statistics represented the “new normal”. But, she conceded: “Claims are only going in one direction – and that is upwards.”

Employment tribunal fees were introduced four years ago, but were removed on 26 July this year after a Supreme Court ruling found that the government had acted unlawfully and unconstitutionally when it introduced them.

Steiner added: “The Supreme Court heard convincing evidence that many workers didn’t bother to bring claims for unlawful deductions from wages such as being underpaid holiday because the cost of bringing them often exceeded the amount in dispute.

“Attitudes have clearly now changed, and we are likely to see increasing numbers of workers willing to bring claims if they cannot resolve disputes directly with their employers.”

Head of advisory at employment law firm Peninsula, Kate Palmer, told Business Advice that the increase in claims showed it had become more important than ever that employers were operating in an honest, fair and lawful way.

She advised employers to always seek advice and check the merits of a claim, adding: “The government intended to reduce the number of weak and spurious claims made by introducing fees.

“Now these are no longer payable, there may be an increase in the number of weak claims made from claimants who are looking to receive an early financial settlement. There is no financial deterrent for employees, or ex-employees, who wish to make a claim so employers need to avoid placing themselves in a position where they could end up in front of a tribunal.

“Having the correct documentation, implementing transparent policies, following fair and reasonable processes will all help limit the risk of facing claims at employment tribunals.”

Read more: Bosses braced for rise in claims as Supreme Court declares tribunal fees unlawful

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ABOUT THE EXPERT

Fred Heritage is deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London. He previously worked as a reporter at Global Trade Review magazine.

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