Two Important changes to boost the economy

First, it is reported the qualifying period for unfair dismissal will be increased from one year to two years with effect from 1 April 2012.

There are presently routes to presenting Unfair Dismissal complaints without the necessary service requirement, such as lodging claims that an employee’s dismissal was motivated through discrimination, or that an employee was dismissed for blowing the whistle.

This will remain the case when the new two year service requirement takes effect on 1 April 2012 and we may well see an increase in these types of claims following 1 April 2012.

These types of claim are generally far more complex for employers to deal with than a standard unfair dismissal complaint and generally require multiple day full merits hearings to be resolved, with the financial penalties for employers (should their defence fail) being uncapped.

As a result, cases such as these generally result in heavy reliance on external legal support, since without that support, employers can have difficulty understanding how to respond to the presented claim(s).

Of course, there will always be claims like these lodged that have little or no prospects for success.

Where a dismissal motivated by alleged discrimination is claimed, the difficulty for employers and the Employment Tribunal service is identifying those weak claims at an early stage, without the need for hearing evidence.

Indeed, dealing with a claim that a dismissal was motivated by alleged discrimination without evidence being heard is generally the rare exception rather than the rule, so of course it follows where settlement is not achievable, a case like this will almost certainly result in a full Employment Tribunal hearing.

So the Jury is well and truly out on whether the above change will see a reduction in Employment Tribunal claims, or whether indeed it will see an increase in more complex litigation for employers to have to deal with.

Secondly, the introduction of fees for bringing tribunal claims from April 2013.

There is some information available which outlines the fee structure which may apply: 

• A. upfront fee of £250 when lodging ET1;
• B. further fee of £1,000 payable by Claimant when the hearing is listed;
• C. higher fees if the claim is for over £30,000;
• D. fee to be refunded if Claimant wins, and forfeited if they lose;
• E. fees to be waived for those with without the financial resources to pay;

The above said, there is no detail published on how fee waivers will apply.

If the test for a fee-waiver is being on income support, most ex-employees will automatically qualify for the fee waiver, but those still in a job, or indeed who have got a new job since their dismissal, will not.

This may well see a decrease in the availability of prospective employees for employers gearing for growth and have no reduction impact on the current number of Employment Tribunal claims.

In these circumstances it is important employers have access to sound legal advice such that where a fee waiver is sought by an ex employee, that waiver is challenged in the strongest possible terms.

Of course a lack of Employment Tribunal fee structure until 2013 will likely not have any impact in reducing the number of Employment Tribunal claims in the short term.

Having said all of that, I’m not at all convinced the Government can bring in the above fees, since the various anti discrimination European Directives state: ‘Member States should provide for effective, proportionate and dissuasive sanctions in cases of breaches of the obligations…’

If the fee system restricts or dissuades people obtaining redress of what are basic rights, then I can see this being challenged at the European Court of Justice by the various equality groups.