Update on ‘Cliffs and Claims’

EMPLOYMENT TRIBUNAL CLAIMS

POST-FEES

UPDATE

 

 

 

In my earlier post I analysed the figures that the Government published on 18 October 2013, a few days in advance of the judicial review hearing challenging the introduction of fees for bringing employment tribunal proceedings. My analysis showed significant drop in the number of claims being submitted. The drop was far greater than the Ministry of Justice’s analysis appeared to suggest. The MoJ’s line was that “Employment Tribunal receipts were around 40,000 for July – September in line with historical quarterly trends [my emphasis].

My analysis was that once you get past the distorting effect of the 29 July 2013, when fees were imposed, claims had dropped by over 75%. (By ‘distorting effect’ I mean where there is a specific date for fees to be introduced, it will have the effect of many claims being submitted early, to beat the fees, with a corresponding decrease in claims immediately after that date).

One big caveat that was attached to the figures by the MoJ was that they were preliminary figures and subject to revision at a later date. That was a fair point, especially given that a claim is not “accepted” until the fee is paid, or remission granted. Inevitably with a new system – and a government one that involves IT – there will be delays and errors. Claims submitted with applications for remission of fees may have been caught in the system, unable to be included in an earlier count.

The MoJ has published its updated figures today. Very little has changed for the current year, but –  surprisingly – quite a lot has for last year.

In reviewing the figures for the current year, we are most concerned with quarter 2, being July to September 2013. Unhelpfully the information published by the MoJ does not follow the same format as that published in October. No information is given on the number of single claims submitted, so I am not able to revise my analysis on those (a drop of from over 4,000 claims per month on average, to  just 1,003 this September).

We do have figures for multiple claims. The provisional figures showed 1,034 multiple claims accepted in the quarter; the revised figures show 1,061, a modest revision. Unfortunately, a month-by-month breakdown is not given so a similar comparison as in my last post cannot be done.

One can also look at “receipts” for the quarter. In my view this is not as good a measure as single or even multiple claims, but we can at least see to what extent there have been revisions from the provisional figures. The figures in October showed receipts of 38,963. Today’s revised figures show receipts of 39,514. A modest increase of about 1.4%.

Therefore, now we have the revised figures, we can see that very little has changed. The number of claims remains significantly down following the introduction of fees.

What is curious is what has happened to the figures for 2012/13. These show a significant downwards revision. In July and October 2013 figures were published for 2012/13. These showed the following:

 

2012/13

Apr-

Jun

Jul-

Sep

Oct-

Dec

Jan-

Mar

Annual Total

Total Claims Accepted

51,463

47,614

45,240

63,715

208,032

The figures published today show a significant difference:

 

2012/13

Apr-Jun

Jul-Sep

Oct-Dec

Jan-Mar

Annual Total

Total Claims Accepted

40,305

47,789

45,710

57,737

191,541

No note or explanation is provided in the commentary that accompanies the figures. It would be unusual for such revisions to be of this size and made so late. Needless to say, enquiries are being made.

If one wanted to show a consistent downward pattern in employment tribunal claims since, say, May 2010, then it would certainly be helpful to revise 2012/13 down by at least this amount. I’m not being cynical and I’m sure there’s a perfectly reasonable explanation…………..

@AlexLock

 

 

Cliffs and claims: Employment Tribunal cases post-fees

EMPLOYMENT TRIBUNAL CLAIMS

POST-FEES

PART 1 

 

On 29 July 2013 the Government introduced fees for those wishing to bring claims in the employment tribunals seeking to enforce their rights. For a system set up to be quick, simple, informal and free, this was the single biggest – and arguably most controversial – change since the tribunals were created in 1964. The Government stated the reason for doing so was to make sure that the users of the system paid their fair share of the cost of it, rather than it all falling to the taxpayer. No mention was made of the fact that the users of the system were, almost without exception, taxpayers.

The suspicion was that a government which had, in some quarters, expressed hostility to employees having and exercising rights, was introducing fees in order to cut the number of claims. Those suspicions were not allayed when the size of the fees were confirmed. For simple ‘money’ claims there was to be a fee of £160 to issue and a further £230 should it proceed to a hearing. For more complex claims the issue fee would be £250 with a further £950 for the hearing.

Unsurprisingly the introduction of fees was challenged via a judicial review application brought by UNISON (current fee £60 plus £215 for a hearing. The Government has now proposed increasing this to £135 plus £680 for a hearing). The hearing for this challenge began on 22 October. Just days before, on 18 October, the Ministry of Justice published an “ad-hoc statistical notice” showing the number of claims received into the employment tribunal system in the period July to September 2013. The key messages in the executive summary were:

  • They normally have an average of 17,000 “receipts” per month
  • In June there were 25,000 “receipts” and in July 17,000
  • In August there were 7,000 “receipts” and in September 14,000
  • The top “key finding” was that, “Employment Tribunal receipts were around 40,000 for July – September in line with historical quarterly trends”

A cynic may suggest that what the Government was saying, in advance of the judicial review hearing, was that:

  • the introduction of fees hadn’t really had an effect on the number of claims being brought – “in line with historical quarterly trends” – showing a decrease of only 2,000 “receipts” over what they would normally expect.
  • That is only a 5% drop (which probably represented the unmeritorious claims usually put in by the idle, making use of a free-system funded by the taxpayer, just to annoy their employers (and probably hard-working families)).
  • Quite properly the Government was re-balancing the system so that users made a proper contribution.

How could anyone criticise this? Surely the facts speak for themselves, particularly in the statistics the Government had so helpfully released prior to the judicial review hearing. As is so often the case, the executive summary was not really a summary at all. It is the place where you put the messages you want to get across, safe in the knowledge that few people will venture beyond it. Particularly where there are graphs, tables and figures.

First off, it is important to be clear about our language. In the executive summary the MoJ spoke of “receipts”, rather than cases or claims. There are two types of figures that are recorded:

  • Single claims – where an individual brings a claim against the employer. This may be Fred bringing an unfair dismissal claim; Susan bringing an unfair dismissal and unpaid accrued holiday claim; or Jay bringing a discrimination and whistle-blowing claim
  • Multiple claim – where two or more individuals bring claims against a common employer. This may be a group of transferring employees alleging a failure to inform and consult following  a TUPE; or it may be a huge number of cabin crew bringing a claim against an airline alleging their holiday pay has not been calculated correctly (of which more later).

“Receipts” is an amalgamation of the two types of claims, i.e. adding up the number of single and multiple claims received, but counting each of the claims within the multiple claims individually. Therefore, if 1,000 single claims were received and 1,000 multiple claims each comprising 10 individuals were also received, “receipts” would total 1,000 + (1,000 x 10) = 11,000, rather than 1,000 = 1,000 = 2,000 receipts.

Does it make any difference if we look at single and multiple claims separately rather than together as receipts? The short answer is yes and arguably a more accurate picture is painted as to what is happening to claims following the introduction of fees. If we start off with single claims – where a worker or employee submits a claim against his or her employer – what would we normally see? If we go back to 2012 there is a fairly consistent pattern of 4,000+ cases bring received nationally each month (the average is 4,602, with a range from 4,021 to 4,981).

If we look at the period from January to June 2013, much the same pattern is evident: an average of 4,380 per month, with a range from 4,029 to 4,635.

Moving on to July 2013 – with fees looming on 29th – there is a spike in claims to 6,691, a rise of over 2,300 on the average, representing a more than 50% increase. This is to be expected, as the MoJ acknowledges, with claimants bringing forward submission of claims to avoid the fee.

This was bound to result in a decrease for August, which it did: down to 3,341, as some of the claims submitted in July would have been submitted in August but for the introduction of fees.

Turning to September, just 1,003 single claims were submitted, being only 23% of the average for 2013 (and under 22% of the average for 2012). In September 2012 4,021 were submitted,  more than four times as many.

Surely, however, September suffered from the same fate as August, with claims being submitted early to beat the fee? Probably not and certainly not to the same extent. The reason for that is that the tribunals have a short limitation period. For most claims the period of time in which the claim must be submitted is 3 months. Therefore people cannot hang around and experience suggests that claims submitted in September related to events from late-July onwards, so those claimants would not have had the ability to bring forward submission of their claims in the same way those submitting in July could have done. The events they were complaining about had probably not happened early enough to do so.

One caveat ought to be attached to this analysis. The MoJ only counts a claim as “received” once it has been accepted. For those claimants who applied for remission of the fees, which would delay acceptance of the claim, their cases may not be included in these figures. One smaller caveat – made by the MoJ – is that the figures it released were provisional and subject to change. Final figures will be released on 12 December. Even with those caveats, it is highly unlikely that anything like 3,000+ claims will be restored for September.

So how about multiple cases? For these the “ad-hoc statistical notice” tells us (on page 7) that, “When looking at the number of multiple claims cases, regardless of the number of individuals involved, there is a broadly flat trend from April 2012 to June 2013. There is an increase in multiple claims for July 2013, again possibly due to people wishing to submit cases before the introduction of fees. There is then a decline in cases in August and September 2013.” The question is, how much of a decline?

If we look at the figures for the from April 2012 to June 2013 (none, curiously, are published from January to March 2012) we see a range from 682 to 404 submitted each month, giving an average of 520. In July we see our familiar spike of 616, being about 18% up, with a dip in August to 304. In September we plumb the depths to just 114. That is – again – 22% of the what one would expect to see. If we look at September 2012, 437 multiple cases were received: nearly four times as many, as with the single cases.

We do need to be cautious with multiple cases, however, as they contain a number of individual claimants. This is significant for three reasons. Firstly, there is one fee payable for submitting a multiple case. This means that the impact on each individual is far less than in a single case.

Secondly, in multiple cases the individuals are more likely to be supported by a trade union. Think of cases where multiple individuals bring a claim: failure to collectively consult on redundancies; failure to inform and consult under TUPE; large equal pay claims and so on. In those cases it is the union that will pick up the tab, rather than the individual.

Thirdly, since 2007, there have been over 10,000 claims brought by cabin crew in the airline industry in relation to the calculation of their holiday pay. Those claims are re-submitted every three months. Looking at the figures for ‘multiple receipts’ (the numbers of individuals within multiple cases) in March 2013, for example, there were 20,588. In July – our ‘spike’ month – there were 10,462, in August 4,107 and in September 13,359.

These numbers can really distort the figures, if that is what one wanted to do. When the MoJ, on behalf of the Government, publishes figures immediately prior to a judicial review on the introduction of fee and states that, “Employment Tribunal receipts were around 40,000 for July – September in line with historical quarterly trends(my emphasis), one might conclude that is what was being done. Yes, if you add up all the single claims in July to September and all the individuals within all the multiple cases, you do get to a figure of 38,963. That is a poor measure, however, and does not disclose what is really going on with employment tribunal claims.

Employment Tribunals up and down the country report that the number of claims has dropped significantly. Analysis of the statistics show that, far from being in line with historical quarterly trends, the number of claims has dropped by over 75% once you are past the distortion of the 29 July deadline.

It is true that claims may recover as people get to grips with a new system. When the statutory dispute resolution procedures were introduced in 2004, the number of tribunal claims dropped by about 25%, as people grappled with “what is a grievance?”, or “is this a Step 1 letter?”. Claims recovered.

What is not a surprise, however, is that if you introduce a hefty fee for something that was previously free, people consume less of it. One can argue about whether making it harder to bring a claim was the intention of a Government that commissioned the Beecroft Report, or that stated employers were “too scared” to employ people for fear of being taken to a tribunal. One cannot argue that it was wasn’t foreseeable that fewer people would seek redress through the tribunal system to protect their rights.

@alexlock