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Government should go further than BCC and CBI proposals on employment tribunal reforms

Government should go further than BCC and CBI proposals on employment tribunal reforms

The Association of Recruitment Consultancies (ARC), welcomed the call by the CBI and British Chamber of Commerce for reform of the employment tribunal system reported in the Telegraph and included within discussions on The Today Program yesterday.

The ARC agrees with proposals suggested in the radio interview for up front fees and for Tribunals to take a more robust approach to awarding costs at hearings where the claim has no merit.

However, Adrian Marlowe, Chairman of the ARC commented these ideas are good so far as they go, but the problem that really needs addressing is that claims that obviously have no merit are being allowed to be issued by the Employment Tribunals in the first place. They are then not being rooted out early on, thus forcing the employer to incur cost and put up with disproportionate inconvenience. This often leads to settlement payments to the claimant which otherwise would be wholly unjustified. Even if costs awards are more robust, the claimant may not be able to meet them.

Our investigations last year indicated that even through conciliation, another idea considered in the Radio 4 discussion, some 90% of claims settled involved payment by the employer. This ratio directly conflicts with the results at final hearings, where only 13% of claims succeed. This suggests conciliation is not the answer to the underlying problem, although it would help where claims are genuine.

The ARC, whose members employ substantial staff in the recruitment sector, commenced a campaign on this front last summer, by highlighting this issue to government and suggesting these and additional proposals. It argues that there should be a compulsory pre issue review by a suitable appointed third party to weed out those cases that on the face of it may have no merit. This is because the existing conciliation service through ACAS is neither compulsory nor does it have any power to stop a claim going forwards. At the same time the ARC suggests that Tribunal records, currently not available, should be made available for consideration in the pre issue review in order to identify those claimants that have a history of making vexatious claims.

Mr. Marlowe concluded This has long been the elephant in the room, costing employers and hirers vast sums of money and effort often unnecessarily because of the way the existing system works. With the statistics as they are, this issue urgently needs addressing.

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