Employment Seminar
The Employment Department held an Employment Law Update Seminar in September which provided a summary of Employment Tribunals.
Below is a brief synopsis of the seminar material. If you would like further information, please contact Bethan Southcombe on 0117 945 3084 or e-mail employment@metcalfes.co.uk
SECTION ONE
INTRODUCTION TO EMPLOYMENT TRIBUNALS
The Employment Tribunals are judicial bodies established to resolve disputes between employers and employees over employment rights.
They generally consist of a legally qualified chairperson and two lay members with appropriate experience.
Employment tribunals were formerly known as industrial tribunals.
What claims can be brought by presenting a complaint to the employment tribunal?
In most cases, these claims must be brought by employees, although there are some exceptions.
SECTION TWO
STATUTORY DISMISSAL AND GRIEVANCE PROCEDURES
DISMISSAL AND DISCIPLINARY PROCEDURE
The Dismissal and Disciplinary Procedures ("DDP") are minimum standard imposed by statute which has the aim of resolving disputes in the work place.
There are two forms of statutory DDPs.
1. The standard procedure
2. The modified procedure
The procedures have important consequences on:
- The time limits for bringing claims to the employment tribunal
- The outcome of claims to employment tribunals
- The calculation of compensation
GRIEVANCE PROCEDURE
The Statutory Grievance Procedures ("GP") aim to resolve disputes to avoid ending up before an employment tribunal.
There are two forms of statutory GPs.
1. The standard three-step procedure
2. The modified two-step procedure
The procedures have important consequences on:
- The time limits for bringing a claim
- The outcome of claims to employment tribunals
- The calculation of compensation
SECTION THREE
MAKING A CLAIM
Time limits for issuing
An individual can either submit their Claim Form ("ET1") online www.employmenttribunals.gov.uk or the form can be downloaded and sent by post or fax to the appropriate tribunal office.
A copy of a completed ET1 can be found at the back of this handout.
A claim cannot be accepted unless it meets certain conditions.
By law, the claimant must tell the tribunal:
- their name and address;
- the name and address of the respondent or respondents (the person or organisation against whom they are making a claim);
- the details of their complaint; and
- whether or not they are or were an employee of the respondent.
If it does not relate to them being dismissed, they must also tell them:
- whether they have raised their complaint in writing with the respondent;
- whether they have waited 28 days before presenting their claim to a tribunal office.
If they have not done so, they must give a valid reason why they did not.
Most claims to Employment Tribunals must be made within very strict time limits.
Raising a grievance extends the time limit.
If the tribunal receive a claim outside the time limit, the tribunal will only be able to consider it in a narrow range of circumstances.
There are penalties for submitting a claim before the dismissal or grievance procedures are completed.
Unfair dismissal claim
Length of service
Exceptions to this
- Immediate re-employment order - within 7 days of dismissal
What happens next?
A claim will not be accepted if:
- It is not on an approved form;
- They have not given all the required information; or
- If it applies to their claim, they have not raised their complaint with the respondent and waited 28 days.
If the claim is accepted
- Letter from the tribunal office
- The tribunal will send the respondent a copy of the claim form together with a form for their response.
- If no response is received within 28 days?
- Default judgement
ACAS
In most cases, the tribunal also send a copy of the ET1 to ACAS.
ACAS are an independent conciliation service.
For further information on ACAS please see section five of this handout.
Questionnaires
In discrimination claims, the claimant can serve a formal questionnaire upon a respondent or prospective respondent.
Limits on when this must be done.
A response to a questionnaire should be provided by a respondent within a "reasonable period".
SECTION FOUR
RESPONDING TO A CLAIM
Tribunal will send the Respondent a copy of the ET1 and a Response to an Employment Tribunal Claim ("ET3").
28 days to complete and return.
The ET3 can either be completed online or sent by post or fax.
A copy of a completed ET3 can be found at the back of this handout.
Information needed before a response can be accepted
The tribunal cannot accept your response unless it is on the approved form and you provide certain information. By law, you must tell the tribunal:
- your full name and address;
- whether you want to resist (defend) all or part of the claim; and
- the grounds on which the claim is being resisted.
If your response is not on the approved form, provided by the Employment Tribunals Service, or does not contain the information shown above, it will be returned and the claim dealt with as if the tribunal had not received a response.
Reasons for the tribunal to reject your response
Tribunal can consider issuing a default judgment
What happens when the tribunal receives a response?
Breach of contract claims
If a claimant is no longer employed, he or she may make a claim against an employer for breach of contract. In certain circumstances, this entitles the employer to make a counterclaim. Any such counterclaim must be made within six weeks of receiving the copy of the claim from the tribunal office. If the employer wishes to make a counterclaim, then they need to ask the tribunal office to send them a form.
Employers who make a counterclaim can only be awarded damages for financial loss.
SECTION FIVE
ADVISORY, CONCILIATION AND ARBITRATION SERVICE
Who are ACAS?
Advisory, Conciliation and Arbitration Service ("ACAS")
Independent, impartial organisation
Liaise with both parties with regard to possible settlement
Facilitate reaching an outcome
Conciliation periods
The periods vary as follows:
- Seven weeks (short conciliation period).
- Thirteen weeks (standard conciliation period).
- In some case, there is no fixed period for conciliation.
During the conciliation period, the hearing will not be fixed, although pre-hearing reviews (PHRs) and case management discussions (CMDs) may take place during this time (see section ten of this handout).
The standard conciliation period can be extended by a further two weeks.
The conciliation period can end early.
COT 3 Agreement
ACAS Annual Report
The ACAS annual report for the period 1st April 2006 to 31st March 2007 has shown a slight decrease in the number of claims being made to the employment tribunal. The figures show 105,177 cases in 2006/2007 compared to 109,712 in 2005/2006.
The breakdown of the 2006/2007 figures indicates that there has been a decrease in the number of working time claims, down to 14,960 from 34,365. There has been an increase in the number of equal pay claims from 14,147 to 27,497. Unfair dismissal continues to be the most common area of dispute, with a total of 44,397 claims in the last year. Meanwhile, the predicted surge of age discrimination claims has not emerged; only 739 claims involved age discrimination as either a primary or secondary jurisdiction.
The Employment Tribunal Services Annual Statistics
The Employment Tribunal Services have now published the employment tribunal statistics for 2006/2007, which differ from those published by ACAS in their annual report.
The statistics show that there has been an increase of 15% in claims since 2005/2006 with the figures reaching 132,577 - a record high.
The figures show that there was a 155% rise in equal pay claims and a 100% rise in sex discrimination claims.
The only jurisdiction that has shown a decrease since 2005/2006 were race discrimination claims - down to 3,780 from 4,103 and also working time claims - down to 21,127 from 35,474.
The Employment Appeal Tribunal heard 432 cases at a full hearing - this is a 22% reducing from 2005/2006.
SECTION SIX
SETTLEMENT
Many complaints are settled without a hearing.
What are the usual terms of settlement?
Employers often settle for commercial reasons.
A valid agreement to settle.
ACAS Settlements
ACAS conciliation officers.
It is common practice to exclude all possible claims by the employee.
COT3 Agreement.
Compromise Agreements
Binding agreement in writing between the employer and employee.
No involvement from a conciliation officer.
Certain conditions must be met.
Must relate to the particular complaint and cannot settle claims that have not yet arisen.
What clauses may be found in a compromise agreement?
Payment of contribution to employee's legal fees.
SECTION SEVEN
BUNDLE OF DOCUMENTS
Only documents relevant to issues still to be determined by the tribunal should be included in the common bundle.
Amalgamation of the two lists.
Limit the number of documents put before the tribunal.
Many Tribunals limit the number of pages of a bundle. Bristol Tribunal usually limit a one day hearing to 75 pages.
The test that should be applied by the parties when considering whether a document should be included in the bundle is:
- Firstly, are their witnesses going to refer to this document? and
- Secondly, are they going to cross-examine the other side's witnesses about this document?
If the answer to both questions is "no" from both parties, then the document does not need to be included in the bundle.
Preparation of the bundle
If the tribunal has not given any directions, the parties should agree between themselves who will take responsibility for preparation of the bundle.
An index containing all documents in the bundle should be prepared
Bundle should be paginated with page numbers included in the index.
A bundle should be arranged in chronological order from the earliest document to the latest document, although it can be helpful to start with a section for the "Pleadings".
If the case is complex it may sometimes be useful to have sections.
Recent correspondence between the parties and/or their representatives.
A copy of the bundle should be provided to the other party well in advance of the hearing to assist with their preparation.
The tribunal will require four copies.
Disputes over the bundle
SECTION EIGHT
WITNESS EVIDENCE
Written statements
Exchanged between the parties before the hearing.
In addition to preparing witness statements, a party may wish to consider preparing a chronology of events and a "cast list", particularly in complicated claims. Where possible, these should be agreed with the other party.
Supplemental statements.
Witness orders
A witness order may be useful or even necessary where a witness will not otherwise be released by their employer to attend the hearing, or where a witness simply does not wish to be involved in the proceedings.
An application for a witness order should be made to the tribunal in writing.
A witness attending to give evidence under a witness order will be the witness of the party who has obtained the order. This means that the party will only be able to ask the witness non-leading questions and will not be able to cross-examine them. In many claims, parties seeking witness orders will actually be seeking to cross-examine the witnesses they are calling.
SECTION NINE
THE HEARING DATE
A hearing date will only be changed in exceptional and unforeseen circumstances.
Pre-listing form
In general a tribunal will exercise its discretion to grant a postponement on grounds of the ill-health of a party or a key witness, provided that adequate medical evidence is provided.
SECTION TEN
HEARINGS
There are a number of different kinds of employment tribunal hearings.
Case management discussions, also referred to as CMD's.
Pre-hearing reviews (PHR).
Letter sent to each party giving:
- The date of the hearing.
- State the matters to be decided
The final hearing
Representation at the hearing
SECTION ELEVEN
APPEALS
An appeal from the Employment Tribunal is to the Employment Appeal Tribunal (EAT).
On points of law only.
The EAT will not interfere with the tribunal's findings of fact unless they are "perverse", in other words, the tribunal reached a conclusion that no tribunal could properly have reached on the facts before it.
An appeal from a decision of the EAT is to the Court of Appeal.
Permission should be sought from the EAT when a judgment is given at a hearing, or when a reserved judgment is handed down. If an application is not made then, or if it is refused, permission may be sought from the Court of Appeal directly within 14 days from the date on which the judgment of the EAT is sealed.
SECTION TWELVE
THE DAY OF THE HEARING
What happens at the hearing
Report to reception.
Tribunal clerk.
The chairman will make sure that you take the steps described below in a calm and measured way. However, he or she may have to be firm in moving the case on to make sure that it proceeds at a pace which allows it to be dealt with within the time set aside.
Unfair dismissal cases
Discrimination case
No absolute rule as to which side starts.
Claimant, Respondent and witnesses will have to give evidence on oath or affirmation.
Could be convicted of perjury.
Evidence may be given by reading a prepared written statement.
Cross-examination.
Re-examination'.
Chairman and members may ask some questions.
Once all the evidence has been heard, both sides can sum up before the tribunal retires to consider their judgment.
Announcing decision and reserved decisions.
Compensation issues to be dealt with at the hearing.
The judgment
Written judgment to each party or their representative.
Written reasons if requested within 14 days of the date that the judgment was sent.
Default judgment
What is this?
How to get the tribunal to review a default judgment?
Evidence
The party who has the burden of proof will usually call their witnesses first.
Unfair dismissal claim, this will be the respondent (unless there is a dispute as to whether the claimant was dismissed).
Constructive dismissal or discrimination, this will be the claimant.
The tribunal may, however, decide that it wishes to hear from the other party first, and will often ask the employer to start the evidence, particularly in claims where there are allegations of both unfair dismissal and discrimination, and therefore a mixed burden of proof.
The witness should direct their answers to the tribunal (rather than to the person who is asking the questions, if this is one of the parties).
Matters arising during a hearing
A new cause of action
Submissions
No opening submissions.
Closing submissions are made by both parties once all the evidence has been concluded.
The party who called their witnesses first will go last in making submissions.
What should be dealt with?
Judgment
The tribunal will either give a judgment orally whilst the parties are present at the tribunal, or will give its judgment to the parties in writing at a later date ("a reserved judgment").
The judgment may be reached unanimously or by a majority.
A written judgment should be sent to the parties as soon as practicable.
Written reasons are only provided if requested by one of the parties.
There is no prescribed period within which a tribunal is expected to deliver its judgment, although the normal target period is 3½ months.
Remedies hearing
What is this?
Revised schedule of loss.
Respondent may wish to serve a counter-schedule of loss.
A copy of a schedule of loss can be found attached.
Oral evidence will normally be given by the claimant.
The claimant will be cross-examined and asked questions by the panel in the same way as at a full hearing.
The respondent will also have the opportunity to call evidence
SECTION THIRTEEN
COMPENSATION AWARDS
Claimant
Will need to produce evidence of what they want.
Respondent
Should produce any evidence and submissions which relate to what the claimant is looking for if their claim is successful.
Tribunal may consider ordering reinstatement or re-engagement.
Respondent should be prepared to give evidence at the hearing as to:
- the availability of the job which the claimant held or of similar jobs;
- whether they would take the claimant back either in the old job or in a similar one; and
- reasons if the respondent says it would not be practical or possible to reinstate the claimant.
If the claimant was a member of a pension scheme, then certain information must be brought to the tribunal's attention.
Unfair Dismissal
The compensation award for unfair dismissal claims consist of two elements:
(1) the basic award; and
(2) the compensatory award.
Breach of Contract
Maximum award is £25,000.
Discrimination
No limit.
Average Awards
The following maximum, average and mean awards were made by the tribunals in 2005/2006, which were issued by the Employment Tribunals Service in July 2006.
Costs awards
580 costs awards were made in 2005/06: 148 to claimants and 432 to respondents. The largest award was £20,000 and the mean average award was £2,256, which is over £400 more than last year.
Targets
The ETS has a number of "key performance targets" for measuring the quality and efficiency of the service, all of which were met or exceeded on a country-wide basis in 2005/06. Note, however, that performance varied by geographical location, and not all local tribunal offices met their individual targets.
SECTION FOURTEEN
COSTS
Costs do not "follow the event" in employment tribunals as they do in civil courts.
Costs Orders
A party who is legally represented at the hearing, or at the point at which a claim is dismissed or otherwise adjudicated upon, may apply for a costs order to be made at any time during the proceedings.
An application may be made at the end of the hearing or may be made in writing to the employment tribunal.
Within 28 days from the issuing of a judgment.
The tribunal has a discretion to make a costs order where any of the following circumstances apply:
- A hearing (including a PHR) is postponed on the application of a party.
- There has been non-compliance with an order or practice direction.
- In the opinion of the tribunal a party has, in bringing (or the party or his representative has, in conducting) the proceedings acted vexatiously, abusively, disruptively, or otherwise unreasonably.
- The bringing or the conducting of the proceedings by a party has been misconceived, which is defined as including having no reasonable prospect of success.
Rule 14(1) imposes a two-stage test for tribunals asked to make a costs order: firstly, did the party act unreasonably and secondly (if it did) should the tribunal exercise its discretion to award costs against that party.
Monaghan v Close Thornton (not yet reported).
McPherson v BNP Paribas [2004].
A costs order may be for a specific sum not exceeding £10,000.
Parties may agree on a sum to be paid.
Tribunal may order a detailed assessment of costs in the county court.
What will the tribunal may take into account?
Costs warning
Historically, costs orders have been made infrequently. In the period from April 2003 to March 2004 a total of 976 awards of costs were made by the tribunals (332 to claimants and 644 to respondents), out of 30,107 claims which went to a hearing.
The average costs order made was £1,859 (ETS annual report 2003/2004). These figures do, however, predate the Employment Tribunal Rules, which, from 1 October 2004 significantly increased the tribunals' powers to make awards of costs.
Claimant seeking to be reinstated or re-engaged and costs orders.
Preparation time orders
A preparation time order may be made in favour of a party who has not been legally represented at the hearing or at the point at which the claim has been determined.
Applications for preparation time orders may be made in the same way as an application for a costs order.
Maximum sum which can be ordered is £10,000.
A costs order and a preparation time order cannot be made in favour of the same party in the same proceedings, although each order could be made in the same proceedings in favour of two different parties i.e. where there are two claimants.
Wasted costs
"Wasted costs" are any costs which are incurred by a party as a result of any improper, unreasonable or negligent act or omission on the part of any representative or costs already incurred which, in light of any such subsequent act or omission, the tribunal considers it is unreasonable to expect the party to pay.
Costs applications
Put the other side on notice of their intention to make such an application in advance.
A schedule of costs should be prepared setting out the costs incurred, including the applicable hourly rate, the number of hours taken and the work carried out.
A costs order cannot be directly enforced and it will be necessary to register the award with the county court on payment of a fee (currently £30) using Form N322a, available from the Courts Service website.
Expenses
Travelling costs and other allowances may be available.
Contact
Judith Ellery Head of Employment
Angelina Rigby Partner
Bethan Southcombe Solicitor