New Tribunal Rules – Help or Hindrance to Employers?

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New Tribunal rules came into effect on 6th April, 2012 that were designed to help employers. This has been a controversial decision which has been justified by the Government on the basis that it “encourages employers to hire new staff.” As we’ve previously mentioned, the qualifying length of service for an unfair dismissal claim increased from one to two years for all employees who join a company on or after 6th April, 2012. Any employee who joined a company prior to this date will retain their rights of a one year qualifying period. Two new pieces of legislation also came into effect on 6th April regarding Tribunal procedures with the aim of assisting employers who are involved in or could potentially be involved in a Tribunal claim. The first piece of legislation allows the Tribunal to award the Company £20,000 in respect of their legal costs (previously£10,000) where an employee loses his claim or it transpires that the employee has made false or malicious allegations. Tribunals are also being encouraged, wherever appropriate, to make a costs order. In an attempt to speed up the Tribunal process, Tribunal judges are now permitted to take witness statements “as read” and to hear all unfair dismissal claims “sitting alone”, rather than be accompanied by two lay panel members as previously. This will allow valuable Tribunal time to be freed up but may be a disadvantage in that only one person will now decide on the outcome of an unfair dismissal claim. Finally, the maximum deposit a party can be ordered to pay as a condition of being allowed to proceed with Tribunal proceedings has been increased from £500 to £1,000 which may result in a claimant withdrawing their claim. The Tribunal can also insist that the parties involved pay or reimburse any expenses that the witnesses may have which would increase overall costs. On the whole, we consider these changes will be a help to employers as the threat of being faced with up to £20,000 costs may be enough to prevent an employee from making a claim.

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