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New Employment Tribunal Proposals

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The expected proposals for changing the Employment Tribunal system were announced yesterday by Stephen Byers, Secretary of State for Trade and Industry. The following is the text of the Department of Trade and Industry’s press release.

New proposals to strengthen and improve the employment tribunal system were announced by Trade and IndustrySecretary Stephen Byers as part of a package of measures outlined by the Prime Minister.

Alongside these changes, ACAS (the Advisory, Conciliation and Arbitration Service) will also be introducing a new arbitration scheme which will provide an alternative to employment tribunals. It will allow employers and employees to resolve unfair dismissal claims through voluntary, confidential arbitration rather than go through a full tribunal hearing and will also free up resources for other tribunal cases.

Four fundamental changes are proposed to the current tribunal rules to make it fairer and quicker for reasonable claims, while imposing greater deterrents and penalties on spurious cases by employees.

The proposed new rules will include:


  • A major increase in the costs which can be awarded for unreasonable or vexatious behaviour from £500 to £10,000 and for the first time the costs awarded will be able to take into account the unreasonable behaviour of the claimant’s representative;
  • a new power for tribunals to strike out ill-founded claims which have no real chance of success;
  • raising the deposit on pursuing a weak case from £150 to £500; and
  • strengthening the management of cases by tribunals.

Making the announcement, Mr Byers said:

“These changes will bring about real improvements to the employment tribunal system.

“There will be tougher penalties on both sides if they are bringing an unreasonable case and there will be greater deterrents for those people looking to bring an action which has little or no chance of success.

“I am concerned that there are too many weak cases in the system causing significant delays for those with genuine claims. They also place unacceptable burdens on businesses and the taxpayer.

“Bringing a case is a serious step. People pursuing a claim with no reasonable prospect of success, or who indulge in time-wasting tactics, must be prepared to face heavy financial penalties.”

Tribunal caseloads have been rising by 10 – 15% over the last few years to nearly 104,000 in 1999/2000. Claims have risen across the board, even over long-established rights. The number of cases resulting from the new rights, such as working time and the national minimum wage, has been relatively low.

The increase has also come about despite there being no rise in the overall level of compensation awarded by tribunals. The median award has held steady at £2,500 for several years.

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