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Employment Law

Legal guidance - compliance - software

Veale Wasborough Vizards , 26 OCT 2015

ACAS early conciliation v Tribunal fees - why are there less tribunal claims?

ACAS early conciliation v Tribunal fees - why are there less tribunal claims?
Gareth Edwards
Partner, Veale Wasbrough Vizards

The Law Society and the President and Regional Employment Judges of the Employment Tribunals (England and Wales) have both called for a reform with regards to the process to bring an employment claim and the tribunal fees payable.

Both bodies argue that the current fee regime has restricted access to justice. Are fees the reason for less claims or has ACAS' early conciliation provided an effective alternative forum for resolving disputes?

In July 2015 ACAS published statistics on the first year of operation of early conciliation, which became compulsory in May 2014. In the period 6 April 2014 to 31 March 2015, just over 83,000 cases went to early conciliation. 15% of the cases referred to early conciliation were concluded by a 'COT3 settlement' whilst 22% of cases proceeded to a tribunal claim and 63% of cases did not proceed to tribunal. Employment tribunal fees were introduced in July 2013. The total number of claims heard between April 2014 and March 2015 was 61,306; down from 105,803 over the same period in 2013/14 and 191,541 in 2012/13, the last 12-moth period before the introduction of fees.

During October, the House of Commons Justice Select Committee published the written evidence submitted to it for their inquiry into the effects of the introduction of tribunal fees. Of particular interest is the President and Regional Employment Judges of the Employment Tribunals (England and Wales) submissions. The Employment Tribunals believe that the introduction of fees has had an 'adverse effect upon access to justice'. They also express concern about the ACAS early conciliation procedure due to little evidence that potential claimants settle their procedure claim or pursue the claim at all once the procedure is over.

Whilst they acknowledge that other factors such as the improving economy and changes in the law have created a 'gentle downward trend', they believe this does not adequately explain the dramatic drop in claims immediately after the introduction of fees and before ACAS early conciliation was introduced. The Employment Tribunals' suggestions for reform include introducing three tiers of fees and making fees automatically repayable in the event of a successful claim.

On 1 October the Law Society published their letter to the Ministry of Justice Employment Tribunal Fees Review Team, a separate review of employment tribunal fees. The Law Society also welcomed reform. Whilst they hope that the review will explain whether the drop is a result of ACAS early conciliation, tribunal fees or even broader economic factors, they still criticise the ACAS early conciliation for having very little impact on early settlements. The Law Society propose that ACAS conduct follow up interviews with parties who do not reach a formal settlement to find out why they do not proceed with their claim.

Best practice

The evidence suggests that whilst the ACAS early conciliation scheme assists with the resolution of some cases, the introduction of fees in the employment tribunal in July 2013 has had a much greater impact on limiting the number of claims in the tribunal. This is bound to influence an employer's approach to a tribunal claim and employers may be reluctant to settle claims at the ACAS early conciliation stage and wait to see whether an employee issues a tribunal claim.

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