Regular readers of this blog (hello, Mum) will know that I am not too impressed with the Ministry of Justice’s two options for an employment tribunal (ET) fees regime. Both options would be horribly complex to administer, especially in relation to multiple claim cases, which employment judges have a practice of merging and splitting as they progress through the system. Option 2 would do nothing to encourage early settlement of a claim (once made), while Option 1 would actually discourage early settlement. And both options would create a substantial barrier to justice.
But there is a further problem: the hefty claimant fees proposed under each option could seriously undermine the only (potentially) positive element of the Government’s package of employment law and ET reform, namely its plan to boost early conciliation of workplace disputes by Acas.
In November 2011, following a consultation exercise earlier in the year, the Department for Business, Innovation & Skills (BIS) confirmed its intention to introduce (through new primary legislation) a specified period for Acas to offer early conciliation before any ET claim fully enters the system. In effect, early conciliation will become the first part of the ET process: would-be claimants will have to submit the details of their claim to Acas, and will then be offered the option of engaging in early conciliation. Accordingly, the conciliation offered will not be mandatory: if either the claimant or the respondent employer decides not to attempt conciliation, then the ET claim will proceed as now.
A cautious welcome
During consultation, the proposal received a cautious welcome from the TUC and Citizens Advice as well as business groups such as the CBI. With good reason because since its launch in 2009, the Acas pre-claim conciliation service has achieved impressive results, with just one-third of completed cases going on to become an ET claim. In its initial impact assessment, BIS predicted that making early conciliation the default would reduce the annual number of ET cases by 25%. If realised, that would be good news for workers, employers and taxpayers alike.
However, as BIS noted in its final impact assessment, with the introduction of substantial claimant fees, respondent employers ‘may be less likely to engage in early conciliation’ than now ‘if they do not believe the claimant will pay the fee’. But for some reason, BIS decided not to factor in any such change in respondent behaviour, and to stick to its estimate of overall take-up of early conciliation (and resultant 25 per cent reduction in ET cases), based on current take-up of post-claim conciliation.
Well, maybe. But to my mind, that seems a tad optimistic. The Ministry of Justice is minded to introduce claimant fees of up to £1,500 under its Option 1, or up to £1,750 under its Option 2. Such hefty claimant fees would surely provide respondent employers with a very good reason to decline the option of engaging in early conciliation by Acas, and put the claimant in the position of having to gamble up to £1,750 to pursue their claim.
As with the Tango, early conciliation requires the willing participation of both parties. Faced with a substantial fee simply to issue an ET claim, workers may well be more willing than now to engage in early conciliation. But any such change in claimant behaviour will be meaningless if employers simply see the proposed fees as a way to make claimants put their money where their mouth is. Not for the first time in public policy-making, a good initiative by one government department could well be nullified by that of another.
Richard Dunstan is a policy wonk who has worked for Citizens Advice, the National Audit Office, the Law Society, and Amnesty International UK.