‘This “triumph for access to justice” will not be welcomed by all’. So declared Supreme Court judge, Lord Reed, on ruling unanimously in favour of Unison, following their appeal against the legality of the system of employment tribunal fees on July 26 2017. At that time, The Institute of Directors warned that the decision would ‘open the door to a spike in malicious or vexatious claims’. Seven years later, we are able to take a look back to see how the concerns played out against the reality.
Employment tribunal fees had been introduced in 2013 and abolished four years later in July 2017, so this can be tracked against a review of the Early Conciliation notifications that ACAS received across this period:
| Period | Volume |
|---|---|
| 1 April 2012 to 31 March 2013 | 191,514 |
| 1 April 2013 to 31 March 2014 | 61,308 |
| 1 April 2014 to 31 March 2015 | 83,423 |
| 1 April 2015 to 31 March 2016 | 92,172 |
| 1 April 2016 to 31 March 2017 | 92,251 |
| 1 April 2017 to 31 March 2018 | 109,685 |
| 1 April 2018 to 31 March 2019 | 132,711 |
| 1 April 2019 to 31 March 2020 | 138,837 |
| 1 April 2020 to 31 March 2021 | 114,533 |
| 1 April 2021 to 31 March 2022 | 90,811 |
| 1 April 2022 to 31 March 2023 | 105,754 |
| 1 April 2023 to 31 March 2024 | 104,884 |
The impact that the fees had on the volumes seems to be clear, with an immediate rise in cases. We can also see what impact the Covid period had, something which created more tension and reaction in the Management Liability market by some margin than the fee change ever did. Expectations around a ‘tsunami’ of claims never materialised and in recent years numbers have actually settled down at volumes lower than anticipated.
Expectations around a ‘tsunami’ of claims never materialised and in recent years numbers have actually settled down at volumes lower than anticipated.
The expected reintroduction of tribunal fees is likely to have been shelved with the change in government and, in any event, at the suggested level of £55 was perhaps more about raising money than affecting behaviour. What is likely to move the dial are the changes that the new government is likely to make in the near future. The Labour administration has made no secret of the fact that, over the next two years, there will be an increase in workplace legislation and employee rights on a scale not seen since the 1970’s. For any business, with any number of employees, there will be many new legal points to consider. Whether hiring, managing or firing, there will be more things to do to stay within the law and more pitfalls to avoid. That, in turn, inevitably means more mistakes will be made and the consequences that brings will need to be faced. Even if mistakes are not made, the rise in employee rights has led to a wide expectation that there will be a rise in the numbers of Employment Tribunal caseloads.
As well as having good controls, Employment Practices Insurance remains an important part of the defence strategy against employment claims. There may not have been a better time to review this for organisations than right now.
