Reduction in response time to government consultations

We often, as a firm, voice our collective opinion on government proposals. In recent years, we have spoken out on a number of issues, ranging from the implementation of a cap on trainee solicitors’ wages, to the Jackson Reforms in the field of Personal Injury law and the now imminent introduction of fees in the Employment Tribunals.

We therefore speak from years of experience when we say that clear and considered responses to consultations require a great deal of research and preparation, which can often take several months.

We were therefore alarmed to hear in recent weeks that the government has now introduced new guidance to shorten the twelve week period for which ministers were previously required to consult the public on government proposals to a mere two weeks.

This clearly will make it extremely difficult for interested parties to gather evidence and prepare a reasoned and informed response to policy changes that directly affect us all.

The upshot of this is that, potentially, sections of the public, in particular those with access to fewer resources who will no doubt struggle to meet the two week deadline, will essentially be left without a voice to challenge government policy.

This appears to us to be nothing more than an attempt by the government to suppress opposition.

To place the effect of reducing the consultation period into context, in their response to the reduction of consultation periods the Institute of Employment Rights cite the Enterprise and Regulatory Reform Bill as an example whereby the government introduced, in their words, a “technical amendment” to existing legislation, without consulting the public. This “technical amendment” was to section 47 of the Health and Safety at Work Act 1974, the significance of which is far-reaching as it overturns the law imposing employers’ strict liability for the health and safety of their employees, which has been in effect for 114 years.

The implications of this are that various existing personal injury clients of our firm who suffer from life-long, incapacitating injuries, including one client who lost an eye, and potentially a career, due to faulty work equipment, would in future have been prevented from bringing their claims against their employer.

We therefore share the view of the Institute of Employment Rights and have supported their ongoing petition to the Secondary Legislation Scrutiny Committee to voice our opposition to the government’s blatant attempt to stifle the voice of opposition.

Christopher Ridley - Solicitor

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

No credible non-political basis for the Government's changes to employment law

 

As lawyers, we can’t help but say: before you change something, look long and hard at the evidence. After all if it isn’t broken, why fix it?

 

What is now amazing us is that the Government’s own evidence indicates there are no sound, solid or non-political reasons for changing the current employment laws we have in this country.

 

For example, according to the BIS Employment Regulation Report for September 2012, UK employment regulation was already in ‘good shape’ before any changes were made.

 

Vince Cable admitted as much in November 2011 when he said, “the UK has one of the most effective and lightly regulated labour markets among developed economies”.

 

The BIS Response to the ‘No Fault Dismissals’ Consultation goes even further than this - identifying that the UK has less employment protection than the BRICS economies – Brazil, Russia, India, China and South Africa – and other developing countries.

 

Yes, that’s right - the Government itself believes we currently have less ‘red tape’ and employment law protection than the world’s fastest growing and newly emerging economies – and that’s before most of the proposed changes – watering down TUPE, bringing in ET fees, scrapping equality questionnaires, removing protection from third party harassment, cutting unfair dismissal compensation by possibly 2/3rds, bringing in ‘employee owner’ contracts etc - come in. Those changes are not expected till 2013.

 

It seems that all external data (largely covering the period before the Government changes began!) support the Government’s evidence:

 

-  Employment Tribunals claims are down 15% nationally.

 

-  The OECD says the UK is already the 3rd least regulated and cheapest labour market (2008) behind only Canada and US.

 

-  The recent World Economic Forum Global Competitiveness Report cited UK’s existing flexibility as to why it moved up from 10th to 8th place in its global rankings.

 

-  The World Bank’s ‘Doing Business’ rankings of 183 countries shows the UK was already 7th in the world in 2011 for ‘ease of operating’ behind only Singapore 1^st, Hong Kong 2^nd, New Zealand 3^rd, USA 4^th, Denmark 5^th and Norway 6^th.

 

So why change things? There seems to be no financial or economic need to do so - and the more the Government changes employment law, the more confused workers and businesses are about their respective rights and obligations - creating more, not less uncertainty.

 

Regardless of this, the Government seems set on a race to the bottom. Many European economies are required to amend employment regulation as part of IMF and European financial support conditions but we seem to be racing to beat them to become one of the world’s worst places to work in terms of rights and protection.

 

 

David Sorensen - Partner

 

 

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

 

 

 

Tribunal Statistics vs Employment Law Reform

 

The Tribunals Service has released statistics, for the period 1 April 2011 to 31 March 2012, showing the types and numbers of claims pursued. At the same time, Vince Cable continues to announce plans to reform employment laws to give more flexibility and confidence to employers managing their workforce. But do they marry up?

 

The total number of claims received by the Tribunal has fallen from 218,100 (2010/2011) to 186,300. For the year 2009/2010 the figure was 236,100. The fall represents a 15% drop in the number of claims being pursued in comparison to last year and a 21% fall in comparison with 2009/2010. 

The government is concerned that too many Tribunal claims are being pursued and, according to John Walker of the Federation of Small Businesses, “Too many small firms don't take on staff because they fear being taken to an employment tribunal.” Can this really be right when the number of Tribunal claims is dropping?

Vince Cable has recently announced a proposal to reduce the cap for compensation in unfair dismissal cases. The cap at present is £72,300. The Tribunal figures for 2011/2012 show that the median award of compensation in unfair dismissal cases was £4,560 and the average award was £9,133. The vast majority of claims do not get anywhere near the cap - so why reduce it?

The Tribunals have also been making more costs awards, where the losing party pays the winner’s costs. Costs should only be awarded in limited circumstances but it seems the Tribunals are more inclined to award costs these days with the number of awards rising from 487 to 1,411, with 1,295 of those awarded to Respondents i.e. employers. In fairness one of those cases involved 800 Claimants being ordered to pay costs, so if that case is counted as one a more accurate picture shows an increase from 487 to 612 costs awards. Nevertheless, there has been an increase in costs awards against a fall in the number of claims pursued. Plainly the Tribunals are already exercising their powers to dissuade employees from making unmeritorious Tribunal claims.

The median awards of compensation for discrimination cases range from £4,267 in religious discrimination cases to £13,505 in sexual orientation cases. Average awards are higher but skewed by maximum awards, such as £4,445,023 in a race discrimination claim. Of course there are going to be very serious cases which warrant substantial awards of compensation, but the figures do not begin to show that compensation is getting out of hand. 

There is so much discussion and consultation about reforming employment law and it all seems to be pointing towards making it even more difficult for employees to exercise their rights and gain access to justice. With the stats showing an ever decreasing number of claims and limited awards of compensation, I’m not at all persuaded there’s a need to change.  

Dan Kindell - Solicitor

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

 

Award of Costs Against Unsuccessful Parties. Toss of a Coin?

It will come as no surprise to readers of this Blog that we are far from fans of the Government’s proposed set of reforms to Employment Tribunal law practice and procedure.

We have talked recently about the serious threat to access to justice posed by the promised introduction (in 2013) of a scheme of fees payable to commence and continue with Tribunal proceedings.

But there is already a disincentive to pursue unmeritorious claims. Tribunals are entitled in appropriate cases to make an award of costs against an unsuccessful party.

In practice those awards are few and far between. When they are made, the Tribunal has a couple of options: it can assess the costs that should be payable to the successful party by the losing party – up to £20,000.00 (a recent change in itself – the figure was £10,000 not long ago); or it can direct that the amount of costs should be assessed by a District Judge in the County Court. County Court Judges and District Judges are used to dealing with complicated assessment of legal costs – Employment Judges rarely are.

So it is with concern that we see that one of the proposed changes to Tribunals’ powers is to remove the current cap on assessed costs. An ET will be able to award any amount of legal costs, though there is no set procedure to govern the process. Toss a coin?

It is not enough that an employee might have to part with a thousand pounds to pursue a case all the way to a Tribunal hearing. If we add to that the threat of legal costs running potentially into tens of thousands of pounds, without even the checks and balances offered by the costs assessment system operated in the County Court, we risk deterring more and more people – and in particular, more and more ordinary working people of modest or average means – from pursuing their rights in the Employment Tribunals.

We’ve said it before but we’ll say it again: the rights granted to us by the great and the good are a waste of space, if we can’t afford to exercise them through due process of law.


Paul Scholey - Senior Partner

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

The Price of Justice?

On 13th July the Ministry of Justice published its response to a consultation on charging fees in Employment Tribunals.

As we have previously reported, the consultation was never about whether ET fees were appropriate – the Government took that as a given; the question was how much ought to be charged.

The Ministry’s Paper includes a draft schedule of fee levels for different types of ET claim.

The “headline” figures include:

Breach of contract £160.00/£230.00.

Unfair dismissal £250.00/£950.00.

Sex discrimination £250.00/£950.00.

In each case there are 2 fees – an “Issue fee” and a “Hearing fee”.

The Issue fee will be payable to start the case. Unless you can foot the bill, or are eligible for some form of remission, you will not be able to commence Tribunal proceedings.

The “Hearing fee” will be payable later in proceedings, but the devil here will be in the detail.

We for example have recently begun a case in the Leeds Employment Tribunal and it has already been listed for a hearing in September 2012. Will the fee under the new regime be payable immediately? Might that be a twelve hundred pounds double-whammy more or less at the outset of the case?

Our concern has always been that individuals (and in particular individuals who are not members of Trade Unions) are going to be denied access to justice by the introduction of fees to pursue Tribunal cases.

Government after Government has crowed from the rooftops about the introduction of new rights – but those rights are worthless unless we have the means to enforce them and to seek a remedy for their abuse.

The new fees are likely to be introduced in Summer 2013. The consultation response is candid about the future: it says, “fee levels are initially set at a rate less than full costs”. The italics are our own – plainly this is the thin end of a fees wedge.

Collective claims pursued by Trade Unions may be more expensive still.

Let’s look at another example: a “complaint by a worker that employer has failed to allow them to take or to pay them for statutory annual leave entitlement” (being a claim under the Working Time Regulations) has an Issue fee of £160.00 and a Hearing fee of £230.00.

That is £390.00 that an employee will have to pay to establish a right to, say, a week’s paid holiday. At minimum wage rates, that would be a fee that exceeds the value of the claim that the employee wishes to make. What price is a week’s holiday?

We note that the Government has not yet made a song and dance about the fact that these fees might be paid, in successful cases, by employers. Tactically it seems to us that some employers are liable to let cases run their course. An employer might well think that an employee is unlikely to risk incurring the full amount of both Issue and Hearing fee, and so decline to look at early settlement in the hope that financial considerations will drive the employee to abandoning their rights. And since the hint is that the ET will have a discretion to award the fees against the employer, might we see cases where the employee wins but still stands the fees – pyrrhic victory indeed.

We understand that if business A and business B fall out about a commercial contract, they can be expected to pay some or all of the costs associated with a Court system that assists them to resolve the dispute between them. That is part of the price of doing business.

Is it now part of the price of being an employee?

Paul Scholey - Senior Partner

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

The Government’s Approach to Women in the Workplace

In November 2011 our Prime Minister said that he was committed to end what he called the ‘scandal’ of women being paid less than men for doing the same job.

If that is right, he is going about things in a strange way.

His government are currently consulting about scrapping the statutory Questionnaire process. This is used by a person who believes she/he has been discriminated against in the workplace, for example, a female employee who believes she has been paid less than her male colleagues, to question her employer and seek information about pay and practices to see whether there has been discrimination. This process is long established having been in place for decades now and is a vital tool for a person who believes they have been discriminated against, enabling that person to obtain true facts and figures, such as pay levels between employees, particularly important when the employer tries to hide such information from its employees (very common in my experience). If this tool is scrapped it will have an enormous, adverse impact on women, disabled persons, minority ethnic groups and so forth within the workplace, making it even harder than it is now for them to show they have suffered discrimination. It will do nothing to help stop pay inequalities; in fact it will make things worse.

The Equality Act 2010 gave an Employment Tribunal wider ranging powers to require employers to stop discriminatory practices (known as ‘recommendations’). In my view, this was an extremely positive development of enormous benefit to not only those who have been discriminated against in a workplace, but the rest of the workforce, as such recommendations are designed to prevent future discrimination. Again, the government is currently consulting about scrapping this power.

The Government has just announced consultation on bringing in mandatory pay audits for employers who lose equal pay claims in an Employment Tribunal. Sounds good on the face of it, but if it’s even harder for an employee to win such a claim because Questionnaires are scrapped, the likelihood of an employer losing reduces.

Scrapping the Questionnaire process and Employment Tribunal recommendations is a scandal in my view and will find favour only with employers who discriminate and use discriminatory practices in their pay systems.

David Sorensen - Partner

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

Age Discrimination – Do We Have a Level Playing Field?

The Supreme Court has recently given Judgment in the case of Homer v Chief Constable of West Yorkshire Police, which is a case concerned with indirect discrimination on the grounds of age and we think the consequences of this decision are interesting.

Mr Homer worked as a legal advisor for the police and in 2005 his department introduced a new grading structure.  In order for him to reach the third threshold he was required to have a law degree.  When he was appointed, a law degree was not essential.  Mr Homer was aged 62 and had a normal retirement age of 65. A law degree would take four years to complete by part-time study. Mr Homer claimed he had been indirectly discriminated against on grounds of age because the requirement to obtain a law degree disproportionately affected people aged 60-65 who would not be able to obtain a law degree before they had to retire.

Mr Homer failed in the Tribunal, Appeal Tribunal and Court of Appeal but the Supreme Court has agreed with him. It has now found that the reason for Mr Homer’s disadvantage was that people in his age group did not have time to acquire a law degree before they retired and this was indirectly discriminatory. Unless the employer can justify this less favourable treatment, it must modify its practices so as to remove the disadvantage.

Is this decision an example of the law of unintended consequences? Won’t an employee who is aged 25 be able to argue that the Supreme Court’s decision will lead to more favourable treatment for older employees? Will a 25 year old need a degree where that condition doesn’t apply to a person aged 60? How will the Tribunal find the right balance?

Perhaps achieving true equality in indirect age discrimination cases will always be taxing. It seems that any attempt to prevent a provision, criterion or practice from being indirectly age discriminatory always has the potential to lead to a disadvantage for another generation. 

Can we really therefore achieve a level playing field in indirect age discrimination?

Dan Kindell - Solicitor

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.