Fee abolition has made it much easier for an employee to take a punt and lodge a claim. ACAS preclaim conciliation can help but if the employee refuses to engage in sensible discussions re a settlement, ACAS will issue a certificate and the next thing you know is an ET1 is on your desk.
Tribunals are Expensive
Losing a tribunal can be a costly exercise. For example, the Employment Tribunal Statistics for 2016/2017 (latest available) cite the median awards for successful claims ranging between £6,500 and £15,000 depending on the claim category.
You can then spend between £8,000 and £30,000 on legal fees, depending on the complexity of the case including the cost of the solicitor, and barrister.
There is also management time to consider; for a manager on £40,000 per annum, the cost to the business of them spending two weeks in preparation ahead of a tribunal hearing could be around £2,000, plus their distraction from the work they should be doing and the impact of the stress on them.
Normally there are at least 2 managerial witnesses at a hearing. But there are also other costs to consider, such as reputational damage to the company, which could cause clients/customers to leave you (if they don’t think you’re acting with integrity and honour towards your staff) as well as employees, both current and prospective.
Don’t forget all tribunal proceedings are on line and visible to your employees and competitors. Employee morale can also take a massive hit, and the most senior people in the company can be heavily distracted by an HR tribunal, meaning they’ve taken their eye off the ball and therefore the bottom line.
So, what can you do to minimise your risk?
Make sure all policies and procedures are up to date. Emphasise the importance of following the correct procedures as simple mistakes can often lead to an unfair dismissal finding.
Train your directors owners, managers and supervisors in how to conduct disciplinaries and how to treat grievances and repeat the training regularly.
Take steps to make sure your actions reflect your corporate values laid out in your handbook.
Treat people like adults and listen to employees but if people don’t want to behave or work properly don’t hesitate to discipline them. Remember in a tribunal the only people who win are the lawyers or HR consultants. If possible, don’t insist on having your day in court if a modest settlement will remove the problem and allow the organisation to go forward.