Business losing confidence in tribunal system, says CBI

Business losing confidence in tribunal system, says CBI
Release date: March 2006

A new report from the CBI has revealed the level of concern among employers over the complexity of tribunal procedure, following amendments to the tribunal rules brought into effect this time last year. The report reveals large numbers of firms settling cases they would have a strong chance of winning out of fear of the cost of going to tribunal. The report, 'Restoring Faith in Employment Tribunals', is the result of findings made by the CBI/Pertemps Employment Trends Survey 2005, to which nearly 450 employers responded.

The CBI points to the following statistics from the report as evidence that the tribunal system is failing employers:

  1. all firms with fewer than 50 staff settled every claim despite advice they would win almost half the cases, and 26 per cent of all firms settled even if they felt the claims lacked merit
  2. 45 per cent of employers believe the system is ineffective and 50 per cent reported a rise in weak and vexatious claims in the last 12 months despite the reforms
  3. 50 per cent of employers have seen a rise in weak and vexatious claims over the past 12 months.

The report also highlights concerns surrounding the Employment Act 2002 (Dispute Resolution) Regulations 2004 (SI 2004/752). The Regulations introduced mandatory dispute resolution procedures from 1 October 2004, designed to encourage resolution of workplace disputes before they reach the tribunal. One third of respondent employers had not noticed a reduction in the number of tribunal claims, and 39 per cent thought the new procedures were not beneficial in reducing the number of weak and vexatious proceedings against them. 22 per cent saw no benefit in terms of resolving disputes in the workplace.

The CBI believes that reform to both the tribunal rules and the dispute resolution procedures is necessary to remedy their perceived failure in the eyes of employers. One of its principal recommendations is a charge for going to tribunal, set at an appropriate level to ensure people have access to justice, to deter weak or vexatious claims. With regard to the dispute resolution procedures, it recommends requiring claimants to make it clear in writing they are lodging a grievance, so employers know they have to begin the appropriate procedures.

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Business losing confidence in tribunal system, says CBI
Release date: March 2006

A new report from the CBI has revealed the level of concern among employers over the complexity of tribunal procedure, following amendments to the tribunal rules brought into effect this time last year. The report reveals large numbers of firms settling cases they would have a strong chance of winning out of fear of the cost of going to tribunal. The report, 'Restoring Faith in Employment Tribunals', is the result of findings made by the CBI/Pertemps Employment Trends Survey 2005, to which nearly 450 employers responded.

The CBI points to the following statistics from the report as evidence that the tribunal system is failing employers:

  1. all firms with fewer than 50 staff settled every claim despite advice they would win almost half the cases, and 26 per cent of all firms settled even if they felt the claims lacked merit
  2. 45 per cent of employers believe the system is ineffective and 50 per cent reported a rise in weak and vexatious claims in the last 12 months despite the reforms
  3. 50 per cent of employers have seen a rise in weak and vexatious claims over the past 12 months.

The report also highlights concerns surrounding the Employment Act 2002 (Dispute Resolution) Regulations 2004 (SI 2004/752). The Regulations introduced mandatory dispute resolution procedures from 1 October 2004, designed to encourage resolution of workplace disputes before they reach the tribunal. One third of respondent employers had not noticed a reduction in the number of tribunal claims, and 39 per cent thought the new procedures were not beneficial in reducing the number of weak and vexatious proceedings against them. 22 per cent saw no benefit in terms of resolving disputes in the workplace.

The CBI believes that reform to both the tribunal rules and the dispute resolution procedures is necessary to remedy their perceived failure in the eyes of employers. One of its principal recommendations is a charge for going to tribunal, set at an appropriate level to ensure people have access to justice, to deter weak or vexatious claims. With regard to the dispute resolution procedures, it recommends requiring claimants to make it clear in writing they are lodging a grievance, so employers know they have to begin the appropriate procedures.