Employment Tribunal Reforms

Vince Cable and David Cameron will today announce proposals including that, as of April

•    there shall be a fee £500 to lodge a claim
•    compulsory mediation for all tribunal claims
•    increase in unfair dismissal qualifying period from one year to two years

In 1970s, the length of service required by a worker to lodge a claim for unfair dismissal was just six months. It then moved to one, and then two, years under Margaret Thatcher, and back to one year with Labour.

Vince Cable is suggesting that bringing in the two year requirement is to cut red tape and that the one year qualification puts employers off recruiting.  However, Nigel Meager, director of the IES, said there is no evidence that moving the threshold has had any effect. “I’m not convinced this will have any impact on employment or creating jobs. Any competent employer is going to be able to make a decision about a new employee’s performance within a year of hiring them. It is not clear what extra advantage there will be from having two years.”  The CIPD holds similar views and we would  agree.  The proposals in relation to unfair dismissal will reduce the number of claims in Tribunals and costs to the Tribunal system buy stripping away employment rights for a large number of people.   They will have negligible impact on the ability to employ or on growth of the business economy.

Proposals for mediation and charge a small fee so as deter the weakest claims have more merit.