Employment Tribunal Fees – A False Sense of Security

Employment Law 14th June 2014

Amanda runs a design and print business employing 24 staff.  One of her design team has never performed particularly well, even though he has worked with her for over 3 years, but Amanda has never addressed this.  She tells herself that it is because he isn’t very creative and lacks attention to detail, however in her heart of hearts she knows it is because she hasn’t trained him properly and had got into the habit of correcting his work without telling him.  Now the economy is picking up she has even less time to do this and feels as though Graham is just too much of a burden.  Amanda searches for some information on the internet and it looks as though she would need to manage and monitor Graham’s performance for up to several months before she can justify dismissing him.

The thought of telling Graham that he is not very good fills her with dread as she knows he has no idea how many issues there have been with his work.  However, after half an hour on her favourite online chat forum it transpires that dismissing Graham is not as much of a risk as she had anticipated.  Apparently, the fee to take an unfair dismissal case to the Employment Tribunal is £1200 and Amanda is sure Graham would not be able to find that amount of money.  Armed with this information, Amanda calls Graham in to her office the next day and tells him she is having to let him go because of a downturn in the business.

Six weeks later, Amanda is horrified to discover an Employment Tribunal claim form in her post.  She cannot quite believe it, where has Graham come by that amount of money?

Could it be…?

a.  he has discovered that his home insurance covers him for legal fees and the Tribunal fee in taking his case to the Employment Tribunal.  As he has reasonable prospects of success, the insurance company has decided to back his claim;

b.  he has taken advice from a solicitor who has assessed his case as having reasonable prospects of success and therefore taken the case on a ‘no win, no fee’ basis, including cover for the Tribunal fee;

c.  he has consulted his Trade Union, of which he has been a member for several years.  As his claim has reasonable prospects of success, his Union will fight the case on his behalf and cover the cost of the Tribunal fee;

d.  he has invested his savings in taking the case to Tribunal.  He feels he has a good case and if he wins, the Tribunal is likely to order Amanda to pay the £1200 fee back to Graham as well as any compensation he is awarded.

Answer: any of the above, as all are possibilities in this scenario.  The introduction of Employment Tribunal fees from 29th July 2013, may put off weak or spurious claims, however multiple sources of funding remain available for employees who have genuine cases.

Unlucky, Amanda.

What could she have done differently?

It is easy to look at this scenario from the outside and say “of course, Amanda should have addressed Graham’s performance issues right from the start”.  However, in the real world that is often easier said than done.  Mismatched expectations of the scope of the role, wanting to give a new employee the benefit of the doubt and being too busy to sit down with staff can all be contributing factors, not to mention being unsure of how to talk about performance with individual employees.

Even where the groundwork has not been done from the outset, employers still have multiple options to deal with shortfalls in performance.  The employee may have potential to perform well and can be trained and supported to the appropriate standard.  Alternatively, the business may embark on a formal performance improvement process ultimately resulting in dismissal or allocate some additional money to reaching a severance deal more quickly on acceptable terms.  All of these would have significantly reduced Amanda’s risk of being taken to the Employment Tribunal.

If you would prefer to base your business decisions on judgment rather than luck, contact us for a no-obligation discussion on 01604 763494 or use the contact form.

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