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John Bowers QC: Employment Hearings Structures

The recently published Law Commission paper on Employment Hearings Structures (released on 26 September 2018) raises some interesting ideas and is wide ranging in scope, although it avoids areas that are politically controversial. The terms of reference also excluded any fundamental restructuring of employment tribunals.

The paper addresses several issues which have been set in stone in the employment area for some time. Some date from the time when there was some doubt about the quality and range of some ET judges. Some of the changes suggested arise because the appellate caselaw has taken a particular direction.

It can be argued that over time the general procedures of courts and tribunals have grown closer, but the tribunal remains generally less formal and also usually cost free which is very significant to litigants. The fact of specialisation of EJs in employment law and procedure is also important to consider when deciding where employment claims should go. The three member jurisdiction of the tribunal is still present in discrimination and equal pay cases whereas at most the county court judge might sit with assessors.

The last time that these issues were considered, Lord Briggs (in his Civil Court Structure Review published in 2016) described the shared and exclusive jurisdiction of courts and tribunals in the employment field as “an awkward area”.

Some of the reforms considered in the Paper although technical in some ways are likely to shift the balance of power between employer and employee. This is however very much a consultative document (with a whole series of questions for consultees to answer) and it is to be hoped that many ELA members will contribute to the (no doubt lively) debate ahead.

The Paper incidentally provides an interesting summary of substantive and procedural employment law. It is in particular easy to forget just how wide ranging are the jurisdictions of the ET.

Limitation periods
I would welcome an increase in the limitation periods to six months in unfair dismissal claims as three months is often too short a period of time for a claimant to gather all relevant material and often tempers cool down after a longer period (and people move on). There are some jurisdictions where the time limit is already six months: exclusion from trade unions, equal pay and claims for unfair dismissal in a strike situation.

It also makes sense to make the extension periods the same, so that for unfair dismissal instead of the “reasonable practicability” extension might be substituted a “just and equitable test” which already works well elsewhere. It makes no sense to have a difference in extension period of reasonable practicability for unfair dismissal and just and equitable for most other rights.

The reasonable practicability test has had many barnacles of authority attached to it over the years whereas the just and equitable principle is more open ended and flexible in nature. There would of course still be a major contrast with the six years period in contractual claims but a relatively short application period is needed in order to retain statutory employment as a speedy jurisdiction.

Breach of contract claims
The breach of contract jurisdiction was a somewhat late addition to the range of ET jurisdictions. It is deliberately somewhat narrow in scope. It is also necessary that claims must be outstanding on termination, which leads to several anomalous situations. For example, a claim for breach of the implied duty of trust and confidence where someone resigns is brought in the ET but if a person simply claims damages for that breach it must proceed in the civil courts.

There is much to be said for the proposition that there should be a “one stop shop” for compensation/damages in employment cases but where there are injunction matters these still should be dealt with in the civil courts. There is a £25000 limit on breach of contract claims; it is odd that it has not been raised so far since its introduction in 1993 and it does place a restraint on the number of cases that can be brought in the employment tribunal. Para 4.22 of the Paper says that the limit “generates complexity and confusion in practice”.

The maximum might be removed altogether. If there were no limit on damages which could be claimed the cap on unfair dismissal compensation would look anomalous. One proposal in the paper which would assist is that the limit on contractual claims in the ET should be raised to £100,000 and that the same limit should apply to counterclaims.

The paper proposes to keep intact the existing exceptions from the ET jurisdiction eg personal injuries and intellectual property disputes. The Law Commission suggest however that it should be clarified that it applies to the end of workers’ contract too.

One other option considered would be to allow claims by employers against employees to be brought in the ET (ie not only counterclaims to actions launched by employees) but that is not recommended.

Claims between multiple respondents
The Paper canvasses the intriguing idea that multiple respondents should be able to claim contributions from each other although perhaps in the absence of the claimants. This should be pursued in my view. It is a quirk of language that the Civil Liability (Contribution) Act 1978 which applies to allow contribution in civil cases does not cover employment tribunals. Further the process of apportionment by which different parties were held liable for particular parts of compensation was recently stamped upon by Court of Appeal. This issue becomes particularly acute if one respondent company goes into liquidation/administration.

The provisional view of the Paper’s authors is that it is hard to defend the status quo position that respondents cannot claim against each other. I agree.

Appeals from the CAC
It is suggested that the EAT should have jurisdiction to take appeals from CAC in trade union recognition cases; the present regime of judicial review restricts too greatly the scope of review and is expensive. The knowledge of the area amongst some Administrative Court judges is naturally minimal and so this would be a step forward.

ETs and civil courts in discrimination cases
The dividing line between civil courts and ETs in discrimination cases is probably the most difficult issue which is addressed in this Paper. In general the tribunal has jurisdiction in work related matters whereas other aspects are dealt with by the county court. There is a carve out from tribunals where there is a statutory appeal provided from a decision (which was recently considered by the Supreme Court in GMC v Michalak [2018] ICR 49). Should the division be modified and should there be more scope to transfer proceedings between the two jurisdictions?

There are many conflicting issues of policy and practicality in these areas. One obvious consideration is the evident need to avoid inconsistent approaches developing between courts and ETs; another is to recognise that civil judges will not be able to build up any specialism in this area. On the other hand EJs may at present have little experience in the non employment areas such as education, housing, insurance or policing with which civil court judges will regularly deal. Further, legal aid may be available in housing cases but not in ET proceedings. ET judges have exposure to and experience in handling discrimination including the often very important stage of the cmd; increasingly ET interim procedures are similar to civil courts. It is also true that discrimination claims may arise in the course of other proceedings.

A separate question is whether jurisdiction should be shared between courts and tribunals. There is already a little used provision for transfer both ways in respect of instructions to discriminate under s111 Equality Act 2010.

One possibility would be to place all discrimination cases in the ET which would have an inevitable impact on costs. The provisional view of the LC is that non employment cases should be retained in the civil courts with judges being given appropriate training in the area. I believe that a more radical approach is desirable, namely to bring all discrimination cases within the ambit of ETs because of the wealth of knowledge of EJs contrasted with the civil courts. The Law Commission are set against transfers of cases from Ets to the county court against the wishes of the claimant.

A further question is the deployment of Employment Judges to sit in civil courts on discrimination cases, often known as “Cross ticketing”. This is a good way forward if the more radical solution is not adopted. The idea would be to move the judge to the work as opposed to the work to the judge as it is put in the paper at para 3.36. There is a pilot scheme at present involving some twenty six EJs sitting in the county court for a four year period for up to thirty days a year. This could be extended to bring a further injection of discrimination experience into the county courts.

The Paper finds a lot to be said for a concurrent jurisdiction with power to transfer. If there is to be a transfer facility, there should be some criteria for the transfer. There would also need to be a triage system to be staffed by an employment judge preferably one who also sits as a recorder.

The system of assessors sitting in county court should be retained; EJ’s are more comfortable than most judges in sitting with lay people anyway.

An Employment and Equalities List
Finally the paper considers the possibility of a list for employment and discrimination cases in the High Court. At present such claims may be lodged in the Chancery or Queens Bench Division and is likely to go before a judge with little experience in the area. On balance it favours an informal list which can be operated flexibly. There is a consultation question on the appropriate name.

The Paper considers many other issues which are unlikely to be controversial

  1. In equal pay it suggests a move so that everything can be dealt with in the  ET;
  2. Chapter 6 notes that there is no power to grant injunctions and suggests that this should not change;
  3. ETs should have their own ability to enforce their orders and no longer rely on the mechanisms of the county court.

One of the key issues which is not dealt with by the Law Commission as it is beyond their scope is the lack of resources going into the Employment Tribunals. In many ways, this is the most important issue of all and does need to be tackled given the large increaser of the number of cases since the fees decision by the Supreme Court.

John Bowers QC
Principal Brasenose College Oxford
Littleton Chambers

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