The days of the Employment Tribunals offering a swift and simple resolution of employment disputes are long gone. Although the overall number of claims being brought is still lower than a decade ago, figures released earlier this year indicate that the system is experiencing significant delays due to a growing backlog of unresolved claims. The number of open (i.e. unresolved) claims has increased by around 11% in two years and it is now taking around 18 months to reach a final hearing even in relatively straightforward claims for unfair dismissal.
A system in crisis
Aside from these headline issues, we are increasingly seeing other symptoms of dysfunction in the system. It has become increasingly common for preliminary hearings and even final hearings to be cancelled at very short notice (typically the day before) due to lack of available judges. This causes huge frustration for clients, who will have incurred costs in preparing for the hearing and Counsel's fees and made arrangements for witnesses to attend. In the London tribunals, if a preliminary hearing is postponed, at present you might easily wait 6 to 9 months for a further preliminary hearing, hugely elongating the litigation process.
At the same time, the Tribunals are increasingly struggling to deal with written applications promptly, meaning that it is very difficult to deal with case management issues without a hearing taking place. This means that final hearings are more likely to be postponed, due to delays in dealing with disputes over disclosure and so on.
Whatever your view of the merits of the Employment Rights Bill, it is widely acknowledged that it is likely to result in an increase in Employment Tribunal claims when it is introduced. The extension of unfair dismissal rights to all employees regardless of length of service, lengthening of time limits for submitting claims (from 3 to 6 months) and creation of new rights for zero hours and agency workers will all contribute to this. With pressure on public finances, it appears unlikely that the Employment Tribunals will receive enough of a budget increase to maintain the current (poor) levels of efficiency with this projected increase in claims, let alone improve matters.
Impact on respondents
Although delays cause claimants huge distress, the impact on respondents shouldn't be underestimated. In the time lag between, say, a dismissal and a final hearing, key witnesses might leave, documents may be mislaid, institutional memory is lost and the claim becomes more difficult to defend. It's also hugely stressful for individual respondents, whose personal assets and reputation are on the line.
So what can employers do to mitigate the impact?
Witnesses: When dealing with potential or actual claims, it's essential to identify key witnesses at the outset. If they leave the organisation before the final hearing, it may be worth considering including an obligation to assist in litigation as a term of any settlement agreement. And, before any witnesses leave, consider whether to obtain a signed witness statement from them at an early stage, so that the employer is not left with no evidence at all from them. It may be necessary to apply for a witness order requiring them to give evidence, although this needs to be considered carefully as it may backfire.
Documents: Likewise, rather than wait until disclosure has been ordered by the Tribunal, it's helpful to search for and identify disclosable documents at an early stage. We usually recommend this approach in any event, as it means that a respondent can take a realistic view of merits at the outset rather than having to change tack if a “smoking gun” emerges late in the day. However, it's even more important where cases are likely to take a long time to resolve, as it reduces the chance of key material being lost or overlooked.
Settlement: Respondents should evaluate how delay will affect settlement dynamics. In some cases, it may make settlement easier to achieve, as delays may reduce a claimant's motivation to pursue the claim - but it may also have the opposite effect. If a claimant spends a long time out of work prior to the final hearing (increasingly likely in the current climate), their loss of earnings will be greater and settlement may be more expensive. Employers should weigh up these factors at an early stage and decide strategically when to make any settlement offer. Alternative dispute resolution may be worth considering including mediation and, if the Tribunal offers it, the option of judicial mediation may be worth taking up, with a view to achieving a swifter resolution.
With little immediate prospect of the delays improving, employers and their lawyers will need to factor them into litigation strategy, however frustrating this may be.
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