CIPD: Fees intended to reduce cases ‘gives less reason for either side to back down’. A mounting backlog of more than 600,000 employment tribunal cases is putting the system under “critical” strain, according to commercial law firm EMW.
Figures calculated by the firm, using data from the HM Courts and Tribunals Service, show there were 625,371 outstanding employment tribunal cases up to the end of the third quarter of 2013. This represents a rise of 10 per cent from the previous year, and is almost two and a half times greater than it was just five years ago, when the backlog was 251,900, EMW said.
The firm warned that the employment tribunals system is now so overstretched that in some cases it is taking “years” rather than months to deal with them, putting pressure on employees and employers involved in litigation, as well as the law community which is struggling to keep up.
Jon Taylor, employment principal at the law firm, said: “This massive backlog in the employment tribunal system just keeps on getting worse and worse. It is a real drain on management time, particularly for SMEs who are unlikely to have their own in-house lawyers or dedicated HR team to
deal with claims.”
He adds: “The system is now so clogged up there are thousands of businesses for whom an employment tribunal claim has simply dragged on for far too long.”
Tribunal claims have increased steadily over the past few years. A huge surge in claims in 2009-10 gives the appearance of a drop in case numbers in the following years, however, the case data after 2009-10 still shows a higher number of tribunal cases than before the claims surge.
Figures from the HM Courts and Tribunals Service show that between 2010-11 there was a 44 per cent rise in employment tribunal cases compared to 2008-09. And between October to December 2012, claims rose 14 per cent compared to the same period in 2011.
Claims for unfair dismissal are among the largest growth areas of tribunal cases, which experts said is directly linked to the current economic situation.
Only 10 per cent of tribunals are ever ruled in favour of the claimant, but each claim puts employers through an average of £8,500 in defence costs, or at the very least £5,400 – the typical out of court settlement. To rebalance this, and to discourage vexatious employment tribunal claims, all new claimants have had to pay an upfront issuing and hearing fee of up to cost of up to £250 and £950 respectively since July 2013. But according to EMW the tribunals system is so overstretched that these steps are “unlikely to have a substantial impact in reducing the backlog in the near future”.
Taylor said: “While the change in the law may make some people think twice about launching new weak cases, it doesn’t do much to address the length of time it’s taking to get these disputes heard.”
He also disputes additional new regulations, requiring all new cases to go through mandatory conciliation, will also make much of a difference. He said: “It’s likely that it could simply make a long drawn-out process seem to take even longer. Ironically, now that there are significant fees involved aimed at acting as a deterrent to taking a case all the way through to a tribunal hearing, there’s actually far less reason for either side to back down and conciliate.”