Compensation for Aborted Hearings from MOJ

I’ve recently been involved with a couple of hearings where no judge was available, so we all trooped off home (at significant expense for my client).

So I did some research on recovering those wasted costs from the famed MOJ Compensation Fund.

Apparently there is no ‘fund’, as such.  Rather, service managers at each tribunal centre have discretion to make payments.  My assistant rang round the tribunals to see what the practice was in different regions.  Most service managers wouldn’t take her call.  Of the few that did, the consistent response was:-

  • they take decisions about compensation on the facts of each case  (what facts?  Everyone wasted costs because no judge was available – how are any of those cases fact-sensitive?)
  • they don’t apply any formal (or informal) criteria – it just depends on the case

Whilst I don’t feel strongly enough about this to launch an e-petition and force a debate in parliament (like that would happen), it’s poor practice that these important decisions – relating to the state keeping up its end of the social (and now fee-paid) contract – should depend on the whim on a local service manager who isn’t even purporting to apply consistent or fair criteria.

Saving Private’s Jobs

Back when I was working at FRU, one of the potential volunteers asked me about whether FRU did Reserve Forces cases. I kind of muddled through because unfortunately at the time, I didn’t really know about them. For those few occasions when you’ve felt that an employee’s been treated so badly it ought to be criminal, you might have Parliament on your side. Unusually dismissing a reservist because he has been or might be called up is a criminal offence.

Reservists generally have the same employment rights as any other employee, and the THE has an excellent summary of some of the rights and obligations for employers of reservists. The Reserve Forces (Safeguard of Employment) Act 1985 is considered in that summary, but the act gives them some more and is almost certainly one of the least used pieces of employment protection legislation. In a recent Freedom of Information request, the MoJ confirmed that in the financial years from 2008-09 to 2012-13, there were 12 applications from reservists for reinstatement or compensation under the act and only 5 hearings were held.

The 1985 Act creates reinstatement committees and sets up statutory appeals from these committees to an umpire, apparently on law and fact. In practise the umpire will be the president of the EAT ex officio. Reinstatement committees can order employers to reinstate army restate reservists and/or pay compensation when the right to reinstatement conferred by the act has not been complied with. Failing to comply with an order of the reinstatement committee is also a criminal offence.

In summary, the rights conferred are:

  • The right to at least 26 weeks reinstatement to an occupation not less favourable to the reservist on terms not less favourable than they were originally employed on;
  • If for any reason it is not (or ceases to be) “reasonable and practicable” to continue a reservist’s employment, they are entitled to the “most favourable occupation” on “the most favourable terms and conditions” which are reasonable and practicable. In effect if there is other work they can do, they should be allowed to do it;

An employer can defeat these rights if more than 6 months pass from the end of a call up before they present themselves for work again. It can also be done if the reservist refuses to take up the job without reasonable cause, or if the reservist fails to notify the employer what they rely on as reasonable cause in writing (s1 (4)). There’s also some unusual limitation periods to bring claims. In practice most claims are likely to need to be brought within 13 weeks of an application (or renewal of an application) to be reinstated, although the somewhat different wording to most employment statutes causes some confusion if it is 13 weeks or the usual 13 weeks less one day.

There’s very little case law on the act. Since it came into force in 1985, I have been able to find only two appeals to Umpires from the reinstatement committees. Ironically, in both Slaven v Thermo Engineers Ltd UKEAT/0568/91  and James v Meterological Office UKEAT/1350/00 the president of the EAT thought the case before them was the first one brought to the umpire. James only really helps with the somewhat onerous requirement to renew applications to be reinstated in writing every 13 weeks in order to have the right to complain to the reinstatement committee. This leaves only a single case on the substantive law in Slaven which is somewhat limited in scope to not offering alternatives after a redundancy, although certainly helpful in setting out burdens of proof for the different stages in cases.

Presumably, an employer could show that it would be not reasonable and practicable to take a reservist back if they were dismissed for gross misconduct, it is as yet apparently untested whether the reinstatement committee would require actual proof or adopt the “honest and reasonable belief” test from unfair dismissal. My gut feeling tends towards the latter as it probably isn’t reasonable and practicable to take back an employee who the employer has justifiably lost all trust and confidence in.

It would require an employer with a somewhat unhealthy appetite for litigation to take a chance on any of the other traditional reasons for dismissal though given the lack of case law, especially with the priority given to reservists for other jobs even where a dismissal was not for redundancy. The phrase “reasonable and practicable” has an attractive sound to employment professionals used to dealing with ET claims out of time, but the “and” in the act as well as the judgment in Slaven suggests a disjunctive tests with an employer needing to get over both hurdles to win rather than a composite question of “reasonable practicability”.

You might not come across many reserve forces employees in your time advising clients, but if you do, this stuff is worth knowing. The additional protections available to them, along with the more severe penalties for employers who get it wrong in some situations are probably likely to help with settlements for claimant lawyers. For respondent advice, the lack of case law and there being no power to award costs is probably likely to make any reinstatement committee defence something of a nightmare, but hopefully forearmed is forewarned.

To fee, or not to fee? The question that Labour must answer soon

In recent weeks I’ve been pondering the Labour Party’s inability to say what, if anything, it plans to do about the Coalition’s employment tribunal fees if elected in 2015.  A number of shadow ministers, including Yvette Cooper and Gloria De Piero, have publicly highlighted the gross injustice of asking women who have been forced out of their job by pregnancy or maternity discrimination to shell out up to £1,200 – the equivalent of nine weeks’ statutory maternity pay – in upfront fees to bring a tribunal claim against their former employer.  And backbenchers Diana Johnson and John Cryer have each raised the issue at Prime Minister’s Questions.  But none of them have been able to say whether Labour would abolish or otherwise reform the fees regime.

No doubt this is partly due to the rigid discipline on making any policy commitment that comes with a price tag – abolishing the fees would leave a hole in the incoming Justice Secretary’s budget of up to £10 million (the sum the Ministry said in 2012 it expected to reap in fee income).  However, it may well be that the Ministry underestimated the impact of its eye-wateringly high fees on the number of claims, which appears to have fallen off a cliff since the introduction of fees in July.  So the actual loss of fee income from abolition could well be much less than £10 million.

More importantly, abolition is by no means the only option.  Back in 2012, when the Ministry was consulting on its proposed fees regime, I suggested an alternative way of generating £10 million of fee income, based on a nominal issue fee for claimants (including each claimant in a multiple claim case) and a more substantial ‘loser’ fee (or penalty) for losing employers – the ultimate ‘users’ of the tribunal system.

That suggestion did not meet with universal approval – the TUC and unions strongly resented any suggestion that their members should pay the same as an individual tribunal claimant for bringing a multiple claim case.

So, here’s another alternative regime: a nominal issue fee for claimants, together with a nominal fee for employers to defend a claim (payable when submitting the ET3 response to the claim).  That would meet the concern of employer lobby groups that would-be claimants need to be “incentivised to think through whether a formal claim really needs to be lodged”, without creating a significant barrier to justice.  And, if there are to be fees, it is entirely fair to charge employers to defend a claim.  Because, with the introduction of ‘early conciliation’ of all potential claims by Acas from April 2014, any employer who fails to resolve the claim (for free) through Acas is from that point on as much a ‘user’ of the tribunal system as the claimant.

Using the ‘steady state’ figures for claims and disposals set out in paragraphs 3.10 – 3.13 of the Ministry’s final impact assessment, I calculate that a flat-rate issue/defend fee of just £50 would generate £4.8 million.  Which could be topped up to some £6.5 million by imposing a ‘loser’ fee/penalty of say £200 on the 8,000 losing employers.  And such a simple, transparent and fair fees regime would obviate a fee remission scheme, thereby saving some £1 million in administration costs.

This basic model could of course be tweaked in any number of ways.  For example, the one in five claims that are straightforward (and mostly low-value) claims for unpaid wages could be charged a lower fee, or exempted altogether (my preference).  And the claimant and respondent employer could each be charged a nominal hearing fee if the claim proceeds that far.

But the essential point is that the price tag attached to restoring access to the employment tribunal system could be very small indeed.  Which means there really is no excuse for Labour’s reticence on the issue.  And, if shadow ministers don’t speak out soon, they might find themselves beaten to it by the Liberal Democrats, looking to differentiate themselves from their erstwhile coalition partners, and tempt back some liberal-minded voters, in the run-up to 2015.

Direct Disability Discrimination – the correct comparator

I have found that representatives often assume that the correct comparator in a direct disability discrimination claim is someone who is not disabled.

You can see why they make their assumption. S.13(1) provides:

“A person (A) discriminates against another (B) if, because of a protected characteristic, A treats B less favourably than A treats or would treat others.”

In order to work out whether the protected characteristic causes the difference in treatment, you would want a comparator who does not have the characteristic. The protected characteristic is defined at EA 2010, s. 4 as “disability”. So it’s simple then: Person B has a disability and their comparator should be someone without a disability. Or is it that simple?

EA 2010, s. 23 tells us how to perform the comparison:

“(1)   On a comparison of cases for the purposes of section 13 … there must be no material difference between the circumstances relating to each case.

(2)   The circumstances relating to a case include a person’s abilities if –

(a)   on a comparison for the purposes of section 13, the protected characteristic is disability”

So, in a direct disability discrimination case, the comparator should have the same “abilities” as the claimant. But a person’s abilities (to carry out normal day to day activities) are a key element in determining whether or not they have the protected characteristic (EA 2010, s. 6(1)(b)), so if claimant and comparator have identical abilities, they may both have a disability.

Why would the Act provide for a test in which both claimant and comparator are disabled? The answer is to be found in the critical (and much ignored) EA 2010, ss 6(3)(a):

“In relation to the protected characteristic of disability –

(a)   a reference to a person who has a particular protected characteristic is a reference to a person who has a particular disability”” [My emphasis].

It is where the claimant’s particular disability is what causes the disparity in treatment that liability is established. The comparator may be another disabled person, provided that their particular disability is different to that of the Claimant.

Or have I got this wrong? This analysis means the scope of protection is much narrower than many assume. Perhaps so narrow that direct disability discrimination claims would only succeed very infrequently. Let’s have an argument in the comments below.

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This is a community blog for Employment Lawyers and HR Professionals. Its purpose is to give a platform for those who have something they want to say about Employment Law and to provide a forum for debate. We would welcome submissions for publication or cross-posting.