UK employers face increasing tribunal costs

News Article - 21 April 2010
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Increasing numbers of employment tribunal claims will cost UK employers £2.6bn over the next three years for both legal defences and payments for awards. The Dickinson Dees Employment Tribunal Index shows employers are likely to face 370,000 more tribunal cases between now and 2013 than from 2006 to 2009.

This equates to an increase in tribunal spending of 46%. Each tribunal costs employers an average of £7000. Dickinson Dees' analysis reveals that tribunals have undergone a year-on-year increase of 20,000 since 1998, and this is expected to rise due to a number of exacerbating factors. 

Increased damages available have encouraged employees to bring employment tribunals in a greater number of cases, and no-win-no-fee legal advisers have made the prospect far more attractive and less risky than in previous years. In addition a more widespread awareness of employees' rights has encouraged staff to redress grievances left over from unsatisfactory periods of employment.

Changes to employment law have also put a greater onus on employers to meet more stringent regulations. Many of these changes have originated from Europe that affect UK employers, yet industry experts also blame ambiguous or additional requirements added to UK law for the rise in employment tribunals. Strong evidence exists that case numbers increase even faster in the years after new legislation has been enacted. 

If the Equality Bill survives the general election, there is potential for an even bigger surge in cases brought to the courts over the next few years. The Equality Bill further codifies the requirements of employers and attempts to redress a perceived gap in the rights of staff working throughout the UK.

Dickinson Dees expect the trend of rising tribunal cases to increase over the next few years as staff see further incentives for action. Changes to employment law may also accelerate the rise as new government measures put more pressure on employers to treat staff responsibly.

Businesses can prepare for changing legislative environments by strengthening their infrastructure to ensure all operations comply when new rules are enacted. Access' integrated HR software is regularly updated to help businesses comply with employment legislation. And because the software also includes a number of features that help improve employer-employee relations - such as the ability to track and act upon staff training requirements - it helps companies lessen the chance of tribunals occurring.

For more information on HR software solutions, please call Access on 0845 345 3300.

Article keywords: Integrated HR software, Dickinson Dees Employment Tribunal Index, employment tribunal, Equality Bill

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