EMPLOYMENT TRIBUNAL CLAIMS SOAR!

Until we change the claim culture in the UK this problem can only escalate still further. Why? The structure allows an employee to claim even if they know their claim is ridiculous. They know that, if it went to Employment Tribunal and was thrown out, it would cost them nothing. (We know that technically Tribunals can levy costs but they very rarely do so). It is cheaper for the employer to pay the employee (ex-employee) to go away rather than fight the claim. All this does is fuel the fire and more employees put in more claims, and this produces more pay-outs.

The new regulations are effective from 06 April and to me they do not appear to provide any solution. Claims on my desk at this time include one for over £50,000 which at the present going rate after negotiation will be settled for about £2,000. Another for over £30,000 has been settled for £2,500. I could go on. An employee gives the employer 3 months notice when he really wants to leave immediately, knowing full well that the employer does not want him on the premises ruining morale and speaking to clients. All the employee wants is three months money to go to Australia for a holiday. If an employee leaves immediately the employer can do nothing, even though it is a breach of contract and the employer is probably landed with business problems as a result.

Until someone designs a contract of employment which is equitable to both parties the problem will not be solved. The new regulations do however give an employer the ability to write in new clauses meaning the employee could be in breach of contract on a number of points, particularly of not trying to resolve grievances and appeals in-house. I do hope employers will seize this opportunity.

Naturally HR4UK.com has incorporated the best sanctions legally available in the contracts we issue for our clients.

EMPLOYMENT LAW CHANGES NECESSITATE SCRUTINY OF EVERY EMPLOYMENT CONTRACT IN THE UK

Over the next few weeks many sections of the Press will be carrying articles about the changes being implemented in April by ACAS, which introduce the revised disciplinary procedure. Many employers will look at these with a sigh of relief, feeling that a little more common sense is being introduced into the employer/employee relationship. Whereas I would not dispute the theory, I am seriously worried about the practice. The results of course will take a few months to assess; however there is one thing I would like to see every employer do NOW to prevent claims against them for breach of contract which, under the new regulations, will not be a breach of law.

Since 2004, if an employer did not carry out the disciplinary procedures to the letter, they could lose on a technicality at Employment Tribunal. As a consequence of this many of the disciplinary procedures written in the terms of employment or handbooks have made statements such as:

“During the first year of employment the procedures shown do not form part of the contract, but the rules do.” This implies that, after the first year, the disciplinary procedure does form part of the contract. It is therefore possible - as the new regulations are not so stringent - that an employer could be complying with the new requirements but in breach of their own contracts. Furthermore, the new ACAS guidelines are designed to stimulate settlement of disputes in the workplace, rather than at Tribunal. This gives an employer the opportunity to introduce enhanced grievance and appeal procedures, laying an added obligation on the employee to use the procedures provided rather than referring the matter for a Tribunal hearing too quickly.

HR4UK.com Limited has produced upgraded contracts covering these changes and these have already been issued to tens of thousands of employees.

Time To Review Your Contracts Of Employment

With everything else happening in the country at present it is not surprising employers are putting off paperwork exercises like reviewing their contracts of employment. This is a great pity because the number of employers seeking to restructure their staff, make redundancies or wanting to put staff on short time is still rising. Why does the contract matter in such situations? Surely the action needed is obvious without worrying about such documents?

If the employer does not have a correctly worded contract of employment allowing them to introduce short time working then the employees may be able to make it very difficult - even stop short-time working. After the changes due in April it is possible that an employer, although complying with the new ACAS guidelines, may be in breach of their own contracts; imagine being legal but being taken to Employment Tribunal for breach of an out of date document!

At the moment I have more Tribunal claims on my desk than I handled in the whole of last year. Two which arrived last Friday are for over £40,000 each, enough to put the employers concerned out of business. These two, like most of the others, are based on the employee saying that the employer’s procedure did not comply with the statutory minimum. The paperwork to provide proof the employer did act correctly is all-important, and this starts with the contract. All the contract revisions we are carrying out at present will incorporate a new-style clause stating the employee has a legal obligation to try and resolve any dispute in-house before going to Employment Tribunal. We are doing this in an extremely clear and open way. If an employee files at Tribunal without attempting to settle the matter internally first, then this clause would give the employer the opportunity to file a claim for his costs against the employee under breach of contract. Naturally we will not know if such a clause would ever stand up in court until it is tested, but we hope in the future it will be a deterrent against employees making wild claims with no chance of success, in the hope of an out of court settlement.