Employees who bring cases over discrimination in the workplace to court create a very real concern for employers, according to one employment solicitor.
James Carmody, of Reculver Solicitors, has pointed out that even if a company wins a claim brought to tribunal, they can seldom recover the costs and time involved in the process.
“A real concern for many employers is that if an employee brings a claim in the employment tribunal, the employer is put in a lose-lose situation,” he said.
“Even if they subsequently win the claim, they will have been put through the hassle and cost of defending it in any event, and legal costs are seldom recoverable against the employee.”
In 2011 the government announced a series of reforms to employment law, including an initiative that would require claimants to pay a fee towards the cost of the tribunal.
However, experts have suggested that the focus should be on avoiding employment tribunals and resolving workplace conflict before it reaches that stage.
While the proposed fee structure for employment tribunals has been met with criticism, the introduction of mediation schemes has received a more welcoming response from industry figures.
Meanwhile, CIPD vice-president Nita Clarke has said that employers need to foster high levels of employee engagement if they want to reduce the number of employment tribunals.
She told People Management she believed that by listening to their workforce, organisations could avoid the costly and damaging effects of dealing with lawyers and PR companies after a claim reaches tribunal stage.
“In organisations that respect staff as an asset there is much more dialogue and transparency, and bad behaviours – whether by managers or staff – do not go unchallenged,” she said.
“I think in those organisations there are less likely to be cases of unfair dismissal and the need to go to employment tribunals and so on. The legislative underpinning is very important, but it’s the culture that changes things in workplaces.”
Safia Boot MSc FCIPD – Respect at Work Limited
Unfortunately, despite encouragement from various bodies (Government, CIPD, ACAS, etc) insufficient organisations have invested in developing conflict mananagement capability for alternative dispute resolution which has a higher chance of win/win outcome via dialogue and a learning conversation. But due to low trust and employee engagement, especially in these tough economic times employees have no option but to pursue the win/lose outcomes that arise from formal internal procedures and external litigation as their organisations offer no alternative routes. The proposed legal changes to the ET procedures will make going to ET even tougher for both sides but if there is no alternative process availabile such as mediation and conflict coaching then employees and employers will face a bleak time and the upward trend in claims over the last 10 years is unlikely to decline signficantly. It also does not help that the bulk of ET claims have come from small employers who lack the resources and know how to develop alternative mechanisms so employees have no choice when they perceive they are unfairly treated; poor standards of investigations also results in poor findings of fact and hence why the level of success at ET for claimants is only about 13% for those that reach hearing stage as a result an employee is left feeling they have not received a full explanation for their treatment or acknowledgement for the psychological impact suffered. As a result of this lack of upfront investment in alternative dispute resolution it is not a surprise that all employers have done is to delay the higher costs to the back-end of disputes once situations reach crisis stage. The higher cost arises from litigiation fees, reduced productivity and higher emotional and physcial health cost – a product of short-termism and lack of strategic thinking. The good news is that smart employers are beginning the realise the benefits of alternative dispute resolution and recognise it fits with their value propositions i.e. turning the rhetoric of vision and values into reality.