Tribunal reforms: A north-south divide?
Author: Kenny Scott
Applies to: England, Wales and Scotland
There is already a significant difference in Employment Tribunal (ET) procedure north and south of the border and there is more to come!
To take some examples, in Scotland written witness statements are not used; witnesses are excluded from the ET hearing until they have given evidence; there is not the same concept of 'disclosure'; there are separate practice directions; different civil procedure rules at play; usually no separate remedies hearing and different rules of authority such as the decisions of the Court of Session being binding.
Two recent proposals suggest a widening of this gap over the next few years. We look at these proposals below and also consider if this might lead to so-called 'forum shopping' in the near future.
The Scottish Government is proposing to scrap ET fees. At the moment, a claimant in Scotland or England with an unfair dismissal claim needs to pay £1,200 in fees before stepping in the tribunal door for the main hearing.
It is widely accepted that the introduction of fees in 2013 has resulted in a significant drop (around 60% by most conservative surveys) in claims being brought. Unison's latest challenge to the fees regime was rejected by the Court of Appeal and we await the outcome of two reviews into the fee system being undertaken by the Government and the Commons Justice Select Committee respectively.
The detail behind the Scottish Government's proposals are still awaited. It should also be noted that the Smith Commission proposes responsibility for the management and operation of ETs in Scotland be transferred to the Scottish Parliament which is likely to lead to yet further divergence when the Scotland Bill is enacted.
England and Wales
Shortly after the Scottish Government's announcement, the Law Society of England and Wales published a discussion document, 'Making employment tribunals work for all. Is it time for a single employment jurisdiction?' The paper recognises that as employment law has increased in complexity and scope there has not been accompanying reform of the ET system which started out as being a non-legal forum where individuals could largely represent themselves. The reality now of course being almost the polar opposite, particularly in complex discrimination claims.
The paper further recognises the confusion and overlap in terms of where certain claims can be brought. Contract based claims can only be brought in the ET after employment has ended and the damages an ET may award in such cases capped at £25,000. Contract based claims during employment must be brought in the civil courts, where there is no cap on awards but a costs regime whereby the loser usually pays.
The paper focuses solely on the position in England and Wales and does not address the fundamentally different court system in Scotland.
In summary, the paper proposes:
- a single employment tribunal/court
- fees and procedure based on the complexity and value of the claim with cases allocated to one of four levels (see below) upon receipt by the ET 'gatekeeper'. Appeals against the allocation would be allowed
- consideration as to whether goods and services discrimination cases should also be dealt with by this single forum given the common underlying principles of law.
- promotion of alternative dispute resolution, including removing the £600 fee for judicial mediation and a revived ACAS arbitration scheme. One example being an 'early neutral evaluation' by an employment judge to highlight the strengths and weaknesses of a case and manage unrealistic expectations
- government reconsideration of the general prohibition on negotiated settlements for most government departments and agencies
Four level system
- Level 1: document based decision making e.g. for unpaid wages claims
- Level 2: judicial inquisitorial approach e.g. redundancy payments, failure to consult
- Level 3: majority of current ET claims but with early neutral evaluation and alternative dispute resolution
- Level 4: for employment cases usually heard under civil litigation principles e.g. post-termination restriction cases. Some of these cases would attract costs as if they were being heard in the civil courts
If we end-up with the current fee regime in England being retained or even a reduced fee regime, might claimants choose to bring their claim in the fee-free Scottish ETs? That could be done in the following scenarios:
- if the respondent to the claim or one of the respondents to the claim (usually the employer) resides or carries on business in Scotland;
- if the acts or omissions complained of took place in Scotland; or
- the work under the relevant contract is to be or has been performed partly in Scotland; or
- a residual category whereby the ET has jurisdiction due to a connection with Great Britain and the connection in question is at least partly a connection with Scotland.
Also of possible relevance is Rule 99 of the ET Rules, whereby there is presidential discretion to transfer claims started in one jurisdiction to the other where it would be 'more conveniently be determined.'
Interesting times ahead! We will bring you the relevant details as the proposals are developed.
This document is for informational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.