The number of Tribunal Cases grew by nearly 25% in 2017/18, the last year full figures are available, compared to the previous financial year says Chris from Expert HR Solutions. The number of cases in England and Wales has, on average, remained constant since 2007/08 at a little over 147,000 he continues.
The really bad news for Employers is that if you are taken to Tribunal it is very unlikely that you will be able to recover your Legal Costs from the Claimant. Since these will probably run into tens of thousands of pounds it is sensible to take out legal insurance cover. It is also sensible to ask the insurer or broker whether the policy guarantees to pay regardless of the probability of winning the case or not. On many Directors and Officers Policies it is also possible to take out Employment Practices cover which may cover the cost of any award made by the Tribunal. Since the chances of the Employer winning are only fractionally better than 50/50 the added cost is well worth while as average awards are around £4,000.
Chris says the top three reasons for being taken to Tribunal have remained consistent over the last eleven years. The top reason relating to pay claims such as failure to pay the National Minimum Wage, Unauthorised deductions from wages or failure to provide a pay slip. These account for about 71,000 cases, and with professional advice are almost entirely avoidable. The second commonest cases are those to do with the Working Time Directive. This is a complex area of employment law because it is not as simple as saying I pay my staff an hourly rate that is above the current minimum wage. There are all sorts of deductions that must be taken into account in order to work out the WTD interpretation of the minimum wage, and these cases account for another 59,000 cases a year on average. Finally, the third commonest cases are those involving unfair dismissal. Not only is the most complex area of law, it is also likely to be much more expensive if you get it wrong, with the basic award being capped at nearly £15,000 and the compensation award being 52 weeks’ gross pay or nearly £84,000 whichever is the lower.
Finally says Chris, of the ten categories of case categories we track only three have been decreasing in numbers over the last few years. There is no way to guarantee you will not be taken to Tribunal, but a simple and cheap way of reducing the risk is ensuring you have a set of HR policies and Contracts of Employment that are compliant with current legislation and case precedent. Expert HR Solutions will review your documentation for FREE and give you a report that indicates the level of risk if any errors are not rectified. If your documents have not been amended in the last two years we can pretty much guarantee they will need some amendment. Why not contact us via our web site or call 01202 611033 to see if we can help.