Tribunals once more

I don’t apologise for returning once more to my hobby-horse, the seemingly unstoppable growth of employment tribunal claims and the pernicious effect of fear of tribunals on the workplace.

They’re in the news again this week with the hearing of the case of Emma Amelia Pearl Czikai (referred to in an earlier blog post) who is seeking the right to pursue £2.5 million compensation for disability discrimination against Simon Cowell, who was rude about her singing abilities on Britain’s Got Talent.

But, as usual, the tabloid coverage of this ridiculous case has not gone behind the headlines to look at the bigger picture of what is happening with tribunals. Figures published a couple of weeks ago show that a staggering 236,000 claims were accepted by the Employment Tribunals Service in 2009-10. This is a 56% increase on the previous year’s total of 151,000.

Much of this increase came from the rise in multiple claims, by which unions use their financial muscle to pursue what are in effect “class actions” by groups of workers, for instance over equal pay or Working Time Directive issues or Transfer of Undertakings (Protection of Employment) regulations. But single claims also rose sharply, by around 14%.

There were big proportional increases in the newer types of discrimination claim. Claims around Religion or Belief were up from 830 to 1000, Sexual Orientation claims from 600 to 710, and Age Discrimination applications rose from 3800 to 5200. And, as might be expected in a recession, claims associated with unfair dismissal, breach of contract and redundancy rose by 17% to 126,300.

The growing workload has led to the appointment of 35 new full-time employment judges and 340 new part-time panel members in the last year. This hasn’t prevented a significant case backlog building up.

Of course only a fraction – less than a fifth last year – of claims accepted by the ETS ever make it to a full tribunal hearing. Most are withdrawn, conciliated by ACAS or struck out without a hearing. Of those cases actually reaching a hearing, over a third fail. But this does not prevent employers spending substantial amounts of time and heavy legal fees defending against cases which have little substance. It was revealed this week, for example, that the University of St Andrews spent £200,000 to defend itself against an unsubstantiated accusation of bullying.

This week I was sharing a platform at the All-Party Parliamentary Group on Well-being Economics with Professor Cary Cooper of the University of Lancaster. Cary asserted that the HR problems of the workplace were simply the result of bad management. Well, this isn’t the view of people I talk to who are actually attempting to manage staff. One lady present pointed to the procedural nightmare involved in dismissing a nursery worker who had put a child at risk through negligence. Getting rid of incompetent teachers is a similar problem, both in schools and in HE. If you put a foot wrong in the long-drawn-out sequence of stages you have to go through, a claim of unfair dismissal will likely be upheld.

New employment law continues to pour out of our legislature. The “family-friendly” legislation embodied in the Equality Act, and coming into force in October, is worrying HR managers at the moment, according to the Annual HR Survey from HReSource. The extended right to request flexible working is particularly problematic, for turning down such a request is fraught with danger for organisations: compensation for discrimination is uncapped.

These things make managers reluctant to attack poor performance at the workplace, and deter them from taking on staff at all where consumer demand is uncertain and staff are expensive to dismiss.

Sooner or later steps are going to have to be taken to turn back the tide of employment regulation, and to make the use of tribunals – where claimants face no real penalties for unfounded claims – the last, rather than the first, resort of people disappointed at work.

1 thought on “Tribunals once more”

  1. Posted 23/07/2010 at 15:22 | Permalink

    The problem partly seems to come back to insiders and outsiders.

    Some of the employment laws are designed to protect the very visible people in work. But at the same time, and maybe to a greater extent, they may hurt the much less visible people out of work. Bastiat’s old point about the ’seen’ and the ‘unseen’.

    Surely sensible reform and dismantling of some of these oppressive labour ‘protection’ laws could make it much easier for some of the currently unemployed to get jobs.

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