Empty justice: the big hole at the heart of the ET system

On Monday, the Law Society published its long-awaited discussion document on reform of the ET system, Making employment tribunals work for all. It’s a considered and thought-provoking document that focusses on the idea, previously floated by former ET President David Latham, of creating a single jurisdiction – an Employment and Equality Court, perhaps – within which “all employment law cases could be heard”.

The document suggests that within this single tribunal or court there could be four levels, to which “cases could be allotted according to their value and complexity, with proportionate rules and procedures applying to the different levels of claims”. Under this model, Levels 1 and 2 would provide “an informal, swifter and therefore less expensive way to resolve disputes that involve simple facts and no new issues of law”, such as claims for unpaid wages. Levels 3 and 4 would be “more formal and legalistic”, with Level 3 operating in a similar way to the current ET system, and Level 4 operating “like a civil court for those cases that are currently heard in the courts”.

It’s hard to disagree with the document’s starting point, namely that “employment-related claims need to be dealt with flexibly, depending on their complexity and the financial stakes. It is not acceptable that individuals should be discouraged from bringing legitimate claims or from opposing them because of the cost or complexity associated with the process”. And I’ve long been an advocate of using a document-based and – where appropriate – inquisitorial decision-making process to determine the most straightforward (and usually low-value) claims quickly and at low cost. So I’m attracted to the idea that the document’s proposed Levels 1 and 2 might “ensure that all workers, including those on low pay, could enforce their statutory rights”. As the discussion document notes, “since the introduction of ET fees [in July 2013] many of these types of cases are no longer pursued in the ET, because the claimant could not afford the financial risk”. Indeed.

However, leaving aside the fact that in 2013 the Coalition government went as far as introducing an enabling power to create a “rapid resolution” process for straightforward ET cases (s11 of the ERR Act 2013), but gave up in the face of legalistic objections from employment law practitioners and the TUC, it’s disappointing that the 25-page document devotes just three short sentences to the long-standing and systemic problem of non-payment of ET awards. Because, from a public policy perspective, there would be little point in re-opening the ET system to thousands of low-paid claimants only for a large proportion of them to end up – however “quickly” and at minimal cost to the taxpayer – with an ‘award’ that’s not worth the paper it’s printed on, because the employer will simply fail to pay up.

By coincidence, on Monday the Herald in Scotland reported the case of Christopher Hillis, who has just ‘won’ an ET award of just over £15,000 against Glasgow restaurant Cail Bruich, in relation to his summary dismissal by (abusive) text in September last year, just days after complaining to the restaurant’s joint owner/chef about being paid (well) below the national minimum wage. Cail Bruich is no rogue chippie – it’s twice won an award as Scotland’s best restaurant – but nevertheless Mr Hillis stands to receive not a penny of his award, as the restaurant’s owners have dissolved the company that (technically) employed him, even though the restaurant where he worked continues to trade (heaven knows how – it’s fancy “modern style” dishes look disgusting to me).

crap food

During the later years of the Coalition government, then BIS minister Jo Swinson did try to do something about the systemic non-payment of awards, but by then it was already too late. As I’ve noted previously on this blog, while Ms Swinson deserves “credit for trying to close the stable door, most of the horses have been galloping around the fields since July 2013, and will continue to do so until such time as the fees regime is substantially reformed”.

Which brings us back to the other great problem with the current ET system: fees. Again, on this issue the Law Society’s discussion document is strangely muted, rightly condemning the impact of fees on access to justice but failing to set out any detailed alternative to outright abolition. But that’s for another blog post.

Rough justice: the intellectual incoherence of Michael Gove

Over the past couple of months, more than one legal commentator has painted the new(ish) secretary of state for justice, Michael Gove, as a bit of a good thing. Admittedly, Attila the Hun would have seemed a breath of fresh air after the not exactly cerebral Chris Grayling. But, since his appointment in May, Gove has won plaudits for swiftly reversing the ludicrous prison book ‘ban’, for highlighting the need to modernise our ridiculously antiquated court procedures, and for hinting he may be something of a penal reformer. Even I have found myself in solidarity with him on decriminalisation of TV licence fee evasion.

So far, however, I have not been tempted to join the emergent Michael Gove Fan Club. Because Gove’s few comments to date on employment tribunal fees, and their devastating impact on workers’ access to justice, suggest his approach to the issue is no more intelligent than that of his predecessor.

In July, when giving oral evidence on the work of his Ministry to the justice select committee of MPs, Gove chose not to deploy any of the Ministry’s lame excuses for the precipitous fall in ET case numbers that followed the introduction of upfront fees of up to £1,200 in July 2013 (“historic downward trend” in case numbers, improving economic conditions, and the introduction – nine months after fees – of ‘mandatory’ Acas early conciliation). However, the supposedly clever justice secretary indicated he will only “revisit” the decision to introduce such prohibitively high fees if “one can point to examples of rough justice – a simple reduction in the numbers of people going to employment tribunals is not in itself proof that there’s been any injustice visited on anyone.” Pressed on this point, Gove responded by saying:

I think that I’d have to see whether or not there was an example of people – or an individual – who’d been dismissed, who hadn’t had appropriate access to justice as a result, and that hard case – or those hard cases – would lead me to think again. But at the moment, what I think is likely to have been the case, is that the bar has been set at a high level, absolutely, but there is no evidence yet that the bar being set at a high level has meant that meritorious claims by people who feel [sic] they’ve been discriminated against aren’t being heard.

Tantalisingly, this suggests that Gove could be persuaded to think again by just one single example of ‘rough justice’, but we all know that’s not the case. The justice secretary would of course say ‘well, that’s only one example, I’m not changing the fees on the basis of just one case. I need to see more.’

But it’s the final part of Gove’s comment that gives away the real intellectual incoherence of his position. For there is in fact no shortage of evidence of people who feel that they’ve been discriminated against (or otherwise unlawfully treated) by an employer, but who say they have been deterred from seeking justice through the tribunal system by the fees. As long ago as July 2014, Citizens Advice published an analysis of 182 potential tribunal claims dealt with by its local offices (formerly known as Citizens Advice Bureaux), showing that 34 potential claimants assessed by their employment law advisers as having a better than even chance of success in the tribunal were put off from pursuing a claim by the fees.

In a recent blog for Working Families, I myself cited the example of ‘Martha’, from the casework of the Working Families legal helpline in (late) 2013. The helpline’s advisers considered ‘Martha’ to have very good grounds for a tribunal claim, but ‘Martha’ was adamant that paying fees of up to £1,200 was not a practicable option for her: “I simply don’t have that sort of money – I’ve just been on maternity leave!” And the report of the helpline’s casework in 2014 includes the following example of apparent ‘rough justice’:

‘Denise’, employed on a zero-hours contract, had had her regular working hours substantially cut since she had taken time off for a pregnancy-related illness. When she had challenged her employer, pointing out that several new staff had been taken on recently, she was told “we need people we can rely on”. The helpline team advised Denise that her treatment amounted to pregnancy discrimination, but Denise said there was no way she could afford to pay the fees of up to £1,200 to pursue a tribunal claim.

Maybe Gove himself has never seen such examples of apparent ‘rough justice’. But we know his Ministry officials and legal counsel have, and we know their response. The 34 Citizens Advice cases they dismissed out of hand, stating – in October 2014, in their detailed grounds of defence of UNISON’s application for judicial review in the High Court – that “the methodology of the study is such that one cannot be confident of its reliability”, and that “whilst the advisers doubtless make a conscientious assessment of the likely prospects of success for their clients, the fact is that, ultimately, the advisers’ assessment is not the most objective one as they have only heard their client’s viewpoint, without the input of the defending employer.” And no doubt they would say the same of the Working Families helpline advisers, and their clients ‘Martha’ and ‘Denise’.

And the fact is, the Ministry mandarins are right. Because, as noted just last month by no less an authority than the Department for Business, Innovation & Skills, “only an employment tribunal can determine whether unlawful discrimination or unfair dismissal has occurred”. And, by definition, the potential but ‘deterred by fees’ claims of ‘Martha’, ‘Denise’, the 34 Citizens Advice clients, and any number of others whose cases have been highlighted over the past two years will never go near an employment tribunal.

So, dozens, hundreds or even thousands of examples of apparent ‘rough justice’ could be put before the justice secretary, but he will always be able to say, in each and every case, ‘but we don’t know that the claim is meritorious, as we haven’t heard the employer’s side of the story’. So he will never have to accept that there has been even one case of genuine ‘rough justice’, and he will never be placed in a position where he has to “think again” about fees. In short, the evidential bar for the Ministry’s post-implementation review of the fees has been set impossibly high, and not even an Olympian case study-gathering effort by critics such as myself (and an awful lot of employment lawyers) would make any difference to the ideology-driven outcome.

And of course, unless Gove is a lot less cerebral than his reputation suggests, he must realise this himself. Which means his response to the justice select committee in July was not just intellectually incoherent. It was grubbily dishonest.

 

One in 10 #ukemplaw statistics are rubbish. Or is it six in 10?

I’ve written here more than once before about the seemingly growing practice by law firms and others of using eye-catching statistics based on ‘quick and dirty’, dubious or even non-existent research to grab a few headlines for their organisation. All too many journalists – in both mainstream media and the specialist press – seem to lack a critical eye, and to simply regurgitate ostensibly ‘shocking’ statistics without question or analysis. And this week has been a bumper week, with no fewer than four questionable research ‘findings’ on different aspects of the labour market making headlines.

On Wednesday, the BBC, Guardian, Independent, Daily Mail and others reported that 58.8 per cent of UK university graduates are working in jobs that do not require a degree, according to research commissioned by the Chartered Institute of Personnel & Development (CIPD). This startling figure was the lead news story on BBC Radio 4’s flagship Today programme, though it appears no one at the BBC thought to query the spurious precision – are the good people at CIPD quite sure it’s not 58.7 per cent? – or to ask how many UK university graduates had actually been surveyed for the research, and when.

The 29-page CIPD report is wordy and no doubt worthy, and there’s no question as to its academic credentials. But you have to dig quite hard to discover that the 58.8 per cent figure is based on data from just one question in a 2010 European Social Survey, namely: “how many years of education someone would need to be hired for their current job”. To arrive at the 58.8 per cent figure, the CIPD researchers then assume “15–16 years of education as the minimum indicator for a graduate job”. That is, they were probably a graduate. But hey, let’s stick 58.8 per cent in the press release and see how it goes. Bingo!

Later the same day, the Daily Telegraph reported that, according to new research by Citizens Advice, 460,000 workers – one in 10 of the 4.6 million self-employed in the UK labour force – are cheated out of holiday pay, sick leave and pensions because “businesses have wrongly hired them as self-employed”. For its 22-page report, Citizens Advice surveyed a total of 491 of its clients, through two separate surveys (one online), and then determined from their answers that one in 10 “are on ‘bogus’ [self-employment] contracts, and should rightfully be appointed as company staff”. (Based on my 13 years at Citizens Advice, I’m surprised it’s only one in 10, but that’s another matter).

Then, on the basis that the “scale” of these 491 responses “provides a statistically-valid representation of the UK self-employment market (at a 95% confidence level, with a plus or minus 4% margin of error)”, despite the respondents to the online survey having self-selected, the Citizen Advice wonks extrapolate their ‘one in 10’ to the 4.6 million self-employed, do a few quick sums to show how much that is costing HM Treasury in lost National Insurance payments (£314m a year), and – Bob’s your uncle! – they have a headline in the Daily Telegraph and a piece on BBC TV’s supposedly cerebral Newsnight (at 20m15).

Screen Shot 2015-08-20 at 12.53.59

Except that, as any fule kno, and as – somewhat bizarrely – the very next sentence in the report acknowledges, Citizens Advice clients are not representative of the national labour force. On average, they are lower paid, lower skilled, work fewer hours, and – crucially – are far more likely to be working for an unscrupulous or ‘rogue’ employer. Furthermore, as already noted above, the online survey collected data from self-selecting respondents (the ‘methodology’ section of the report doesn’t even break down the number of respondents for each of the two surveys). Fortunately, not all journalists are as unquestioning as those at the Telegraph or Newsnight, so (for example) there is no mention of Citizens Advice’s ‘bogus’ 460,000 figure in the FT’s coverage of the report.

Come today, and the Independent reports that “zero-hours contracts make up one in four offers to [the] jobless”, according to research by recruitment website Glassdoor UK. However, a quick glance at Glassdoor’s own press release reveals that the ‘research’ says no such thing. According to that press release, 23 per cent of the 1,001 “unemployed people” surveyed online by market researchers Opinion Matters for Glassdoor in May reported having been “offered a zero-hours contract”. Which begs the obvious question: when, and how many times, were they offered such a contract?

Screen Shot 2015-08-21 at 10.45.33

The press release doesn’t say, and there is no link to any actual report that might explain the research methodology, so I contacted Glassdoor. They replied with a generic statement from Opinion Matters on how they ‘recruit’ such respondents: essentially, respondents are remunerated for being part of a panel that completes any number of surveys emailed to them by Opinion Matters. So we have no way of knowing whether, and if so how, the 1,001 respondents are representative of ‘unemployed people’, even if we can agree on a definition of ‘unemployed’ (e.g. unemployed and seeking work).

Glassdoor also sent me a spreadsheet containing the survey data. This shows that the question asked was simply: “Have you ever [sic] been offered a zero-hours contract”. So, the ‘finding’ that 77 per of the 1,001 respondents have never been offered a zero-hours contract – despite 299 (one in three) having been ‘unemployed’ for longer than three years, and 38 for more than a decade – tells us nothing at all about the proportion of job offers made to ‘the jobless’ in 2015 that are zero-hours contracts.

But it is the middle of the Silly Season. Which perhaps explains why leading law firm Slater & Gordon thought it a good idea to press release its new research with a claim that “almost six in 10 people have witnessed or suffered bullying in the workplace”. Again, there is no link to any actual ‘report’ that might explain the research methodology – despite the press release explicitly referring to “the report” – so I contacted Slater & Gordon to ask for a copy. They told me that the research report exits, but cannot be shared “externally at this stage as some of the details are commercially sensitive”, and referred me to the generic methodology of market researchers Censuswide, who conducted the survey of 2,000 of their 69,000 (remunerated) panel members for Slater & Gordon. And, subsequently, Censuswide told me:

We used an online quantitative methodology to achieve the overall 2,000 sample base of UK workers. In terms of this sample being robust enough to represent the UK workforce, based on the latest employment data from the ONS, there is a total of 31 million workers across the UK. With this in mind, a sample size of 2,000 is considered to be robust and representative (working to a low margin of error of 2.2% and a confidence level of 95%).

Screen Shot 2015-08-21 at 13.19.33

In short, Citizens Advice, Opinion Matters and Censuswide all appear to have worked on the highly questionable assumption that sample size alone is sufficient to ensure that their survey findings are representative of – so can be extrapolated to – the whole labour force. Which perhaps goes some way to explaining why the pollsters got it so wrong in May. For we know that, even if Citizens Advice surveyed all 30,000 of the self-employed people it advises through its “local offices” each year – Citizens Advice Bureaux seem to be a thing of the past, thanks to a recent brand makeover – the findings could still not be extrapolated to the national labour force. And how do we know that there isn’t a correlation between becoming a remunerated Censuswide panel member and having been bullied at work in the past, or between being ‘unemployed’ and becoming a remunerated Opinion Matters panel member?

Which is not to say that there are such correlations. We don’t know one way or the other. But if researchers don’t publish and explain the methodology used for their ‘research’, they must expect at least some people to question their headline-grabbing findings. And, perhaps more importantly, to question what they have added to the debate on labour market issues and appropriate policy responses.

[Postscript: Yesterday evening, Hetan Shah, executive director of the Royal Statistical Society, got in touch via Twitter to draw my attention to this fabulous “new free online stats course for journalists” that the Society has launched “to reduce just this kind of thing”. Managers at Citizens Advice might want to get their policy researchers to complete the course, too.]

BIS/EHRC research prompts a pregnant silence in Westminster

On 24 July, as I was busy lying on a beach in Portugal, the Department for Business Innovation & Skills (BIS) and the Equality & Human Rights Commission (ECHR) published the first findings of their joint, £1 million research study into pregnancy and maternity discrimination at work. Though you could be forgiven for not realising, from the associated press and media coverage, that the study was very much a joint enterprise between BIS and the EHRC. For the current crop of ministers exhibited no desire to associate themselves with the outcome of an initiative announced with some fanfare by their Conservative colleague and then minister for women and equalities, Maria Miller, in October 2013.

Mrs Miller – now chair of the newly-formed women and equalities select committee – did at least manage to tweet a call for ministers to “act to stop employers flouting [the] law protecting pregnant women”. And former BIS minister Jo Swinson – seemingly the driving force behind the 2013 decision to commission the research – went further, describing the findings as “sobering” and using a blog for Mumsnet to call for “a zero tolerance approach to [such] discrimination”. But from prime minister David Cameron, current minister for women and equalities Nicky Morgan, justice secretary Michael Gove, and BIS ministers such as Sajid Javid and Nick Boles, there was not a peep.

This is, to put it mildly, disappointing. For the BIS/EHRC research findings are not just sobering, but shocking. Despite the vast majority of the more than 3,000 employers surveyed for the research reporting that the statutory legal rights relating to pregnancy and maternity are reasonable and easy to implement, the 18-month study found that:

  • Unlawful maternity and pregnancy discrimination is now more common in Britain’s workplaces than ever before, with as many as 54,000 pregnant women and new mothers – one in nine – unfairly forced out of their job every year. This is almost twice the figure of 30,000 suggested by the then Equal Opportunities Commission in 2005, and very close to the figure of “up to 60,000” suggested by Maternity Action in its December 2013 report Overdue;
  • Single mothers, and young mothers (under 25), are at particular risk;
  • One in three women feel their needs during pregnancy or as a new mother are not supported willingly by their employer;
  • One in six new mothers suffer a negative impact on their health or stress levels because of poor treatment at work; and
  • Only one in 12 (8%) of those women who raise a concern about their treatment at work obtain legal advice from an external advice provider such as Maternity Action or a CAB.

You’d think ministers first elected (in 2010) on a manifesto promising to make Britain “the most family-friendly country in Europe” and positioning themselves as the ‘true party of workers’ might have something to say about such authoritative research findings.

However, as Ros Bragg of Maternity Action noted in the Guardian, they might then have to explain not only why they’ve done nothing to address what amounts to a significant deterioration in the position of pregnant women and new mothers in the workplace over the past decade, but also why they have acted to make it far more difficult for women to challenge their employer and obtain justice. In particular, they might have to explain why, since July 2013, women wishing to pursue a tribunal claim for pregnancy, maternity or other discrimination have had to pay up to £1,200 in upfront tribunal fees.

Pursuing a tribunal claim has always been a daunting prospect, especially for pregnant women and new mothers, and – as the following chart shows – the number of claims for pregnancy-related detriment or dismissal has never been huge. But the number of such claims has fallen by 40%, from an average of 126 per month before fees, to just 75 per month in 2014.

Screen Shot 2015-07-30 at 12.52.49

In other words, in 2014 just 893 (1.6%) of the 54,000 women who, according to the meticulous BIS/EHRC research, were forced out of work on account of their pregnancy or maternity leave issued a tribunal claim against their former employer. Not so much a ‘zero tolerance approach to discrimination’ then, as a charter for dinosaur and rogue employers. Yet, as noted by Sally Brett of the TUC, this is hardly surprising when one

“pauses to consider what a new mother is dealing with: sleepless nights, a newborn baby demanding round-the-clock attention, a significantly reduced income, and increased expense. No wonder so many women find it so hard to find the time or energy to research the law, seek advice and lodge a well drafted legal claim within three months of the discrimination they have suffered. No wonder that so few feel ready to stump up £1,200 to get a case lodged and heard at tribunal.”

That government ministers should have nothing at all to say about this is troubling enough. But Cameron, Morgan, Gove and Javid were hardly put to shame by their ministerial shadows. Labour’s press office did put out a brief statement by shadow equalities minister Gloria De Piero – “It’s time to look at how we can strengthen the law and scrap tribunal fees so cost is never a barrier to justice” – but otherwise the silence from Labour MPs, including the four leadership candidates, was almost as deafening as that from government ministers. As far as I can tell, neither Yvette Cooper nor Liz Kendall considered the issue worthy of their comment, despite their (laudable) record of highlighting such discrimination, and the pink bus stayed locked away in its garage.

Such reticence from the party that Liz Kendall describes – in a campaigning piece issued just five days after the launch of the BIS/EHRC research – as “the greatest champion of equality and opportunity that our country has ever known” is mystifying and, it must be said, deeply depressing. It may well be time, in the words of Maternity Action’s Ros Bragg, for ministers to “move beyond family-friendly rhetoric to delivering practical solutions to this persistent and growing problem”, but shadow ministers have yet to deliver any credible rhetoric. It’s not as if the issue is that complex – tens of thousands of women are being forced out of work simply for having babies. And if the Labour opposition really has nothing to say about that, then it’s no surprise that government ministers feel able to sit on their hands too.

The secret of Acas’s success

Just weeks after erroneously informing us that employment tribunal case numbers are “bouncing back following the slump after the introduction of fees”, on Friday the Law Society’s Gazette trumpeted that Acas early conciliation has “cut tribunal cases in half” since its implementation in April 2014.

To be fair, the (very short) news report is a lot more accurate than its headline – so much so that you have to wonder which narcotic substance the sub-editor was enjoying at the time he or she came up with the headline. And perhaps it really doesn’t really matter whether a sub-editor at the Gazette knows the difference between ‘up’ and ‘down’. But if the self-proclaimed “publication of record to solicitors in England and Wales” can get so confused about basic legal matters, we can’t really blame less specialist news outlets (and politicians) for soaking up and repeating such canards. So it’s worth setting out in detail just how wrong that headline is.

The relevant official statistics are freely available. And – especially if we put them into a chart – even Gazette journalists, with their uncritical eye, should be able to see immediately that the implementation of Acas early conciliation in April 2014 has not reduced the number of ET cases by anything like 50%.

Screen Shot 2015-07-27 at 00.03.32

In January and February 2014 – by which time ET case numbers had pretty much stabilised following the introduction of fees in July 2013 – the average monthly number of new ET cases (single claims/cases + multiple claimant cases) was 1,922. And, over the three months up to March 2015 – the most recent months for which the figures are available – it was 1,626. That’s a reduction of 15.4% – which is slightly less than the 17% reduction predicted in the then government’s final regulatory impact assessment in February 2014, and a lot less than the 50% reduction now trumpeted by the Gazette.

Furthermore, no one can say with certainty that all of that 15.4% reduction can be credited to the implementation of ‘mandatory’ Acas early conciliation. As noted previously on this blog, some ministers seem to believe there has been a significant ‘downward trend’ in ET claim numbers in recent years, as the economy has slowly recovered from the near-fatal shock administered by bankers in 2008. And, if they’re right, some of that 15.4% reduction would have happened anyway.

So, how do we square this modest reduction of 15.4% with the fact – more accurately reported by Gazette journalist Chloe Smith in the body of her news report – that Acas is “preventing” about half of the cases notified to it under the early conciliation scheme from progressing to a tribunal claim? Well, one theory, previously set out on this blog, is that Acas is now hoovering up (and conciliating) lots of workplace disputes that would never have become a tribunal claim in any case.

Which, it must be emphasised, is arguably a very good thing. It has always been clear that the overall number of workplace disputes (or potential tribunal cases) far exceeds the actual number of tribunal cases. And, even before the introduction of hefty, upfront fees, many potential tribunal claimants were deterred by the likely time, stress and cost involved – in March 2014, the then minister for employment relations, Jenny Willott, wrote: “it costs on average £1,800 to present a claim at tribunal”. And now it would seem Acas is helping to resolve some of those ‘non-tribunal’ disputes. Bully for Acas, I say.

But the evident ‘success’ of Acas in hoovering up and resolving those ‘extra’ disputes is a separate matter to the (evidently modest) impact of early conciliation on the actual number of tribunal cases. And, of all people, journalists and sub-editors at the Law Society’s Gazette really ought to understand that.

 

 

Workers of the world unite! You have nothing to lose but your promiscuity.

On Wednesday, justice secretary Michael Gove gave oral evidence to the Justice select committee of MPs on the work of his department. And, thanks to two Labour members of the committee – Nick Thomas-Symonds and Richard Burgon – we learnt a little bit about the minister’s views on the impact of employment tribunal fees. If you have the time and the inclination, you can watch the whole thing on parliament TV, and there will be a full transcript in due course. However, as it may be a few days before that official transcript appears, here is my unofficial one.

In response to a question by Conservative member Alex Chalk about the “evidential underpinning” for the recent hike in civil court fees, Gove had just stated that the government had sought to ensure that the “fees better reflect the cost of the justice system”, but “we can’t know until fees are in place what the real impact will be”. Amen to that.

Nick Thomas-Symonds: You just said, Secretary of State, in the answer to Alex, that fees better reflecting the cost of justice is the general principle, but I’m sure you’ll appreciate Secretary of State that with employment tribunals, for example, they are in a cost-neutral environment, so surely the argument can’t apply, can it, to the enormous hike in employment tribunal fees that happened? Is that something that you intend to revisit, because there clearly is an access to justice issue if people who have lost their jobs are clearly not going to be in a position to fork out the kind of fees that they now have to?

Michael Gove: Well, there are two things I’d say. First, what we’ve got to try to do is make sure that, as much as possible, the justice system overall recovers costs. So it will be the case that there will be costs in one part of the justice system which will cross-subsidise other parts as well. That’s the first thing.

The second thing is that, with respect to employment tribunals, we are committed to reviewing the impact o those changes. My predecessor entered into a commitment to review them, I think it was the former business secretary, the former member for Twickenham, who was concerned that that review should take place before the election. We are carrying out that review, and we will share with this committee and with the Commons more widely the results of that review.

And you are right, that it’s important with employment tribunals that we balance the rights of individuals who may have been dismissed, also with the need to ensure, as I think will have been the case in the past, that we don’t have – um, what’s the word? – too promiscuous use of the employment tribunals by individuals who have been fairly dismissed.

Nick Thomas-Symonds: If the evidence shows, Secretary of State, that there has been a severe and substantial reduction in the number of cases going through employment tribunals, would that be (a) a cause of concern; and (b) something that might lead you to rethink the level of fees and reduce them?

Michael Gove: Not intrinsically. Without wanting to pre-empt the review – because, by definition, there will be issues raised by the officials conducting that review that I might not be able to anticipate …

Nick Thomas-Symonds: I appreciate that.

Michael Gove: But, my view would be it’s only if one can point to examples of rough justice that one should seek to revisit it – a simple reduction in the numbers of people going to employment tribunals is not in itself proof that there’s been any injustice visited on anyone.

Nick Thomas-Symonds: One further point. The point I made was not simply whether there’s been a reduction, but a very substantial reduction. Some figures I have seen show, for example, a 79% reduction, something like that. Now, whilst in itself a reduction does not point to it, that level surely does and should be a matter of concern to you, Secretary of State.

Michael Gove: It’s certainly a cause to want to review things, yes, but it need not necessarily be the case that such a significant reduction has automatically led – automatically led – to people who should have had a particular outcome not enjoying the justice that they deserve.

Richard Burgon: My colleague did mention that there’s been figures of up to a 79% decrease in claims, particularly in relation to discrimination claims, so I’m wondering, do you think – if there’s been a decrease in employment tribunal claims of up to 80% – there has been a similar decrease in employers treating employees badly?

Michael Gove: I think that I’d have to see whether or not there was an example of people – or an individual – who’d been dismissed, who hadn’t had appropriate access to justice as a result, and that hard case – or those hard cases – would lead me to think again. But at the moment, what I think is likely to have been the case, is that the bar has been set at a high level, absolutely, but there is no evidence yet that the bar being set at a high level has meant that meritorious claims by people who feel they’ve been discriminated against aren’t being heard.

Richard Burgon: Secretary of State, it also concerns me not just that those who are seeking to bring a claim might have access to justice denied, but the effect it has on the whole workforce if employers know that the chance of an employment tribunal claim being brought against them is so much lower than it used to be that can effect the way that workers right across the field of employment are treated, including those who wouldn’t dream of bringing a claim even if they are treated badly.

Michael Gove: I absolutely understand your line of thinking. If it’s the case that it appears workers rights are eroded, then that can become a charter for tyrannical bosses to act in an outrageous fashion. But I don’t see any evidence of that. So, while its a perfectly internally coherent theoretical argument, I don’t see evidence that employers are behaving in an outrageous way. And I should say that if one looks at some of the other things that this government has done, from our proposal to increase the minimum wage to a living wage, through to the announcement yesterday by the prime minister of equal pay audits, then actually what this government has done is show that you can safeguard and enhance workers’ rights, but not necessarily in a way that a different political party would have done.

 

We can see the hand of Elias LJ in some of the minister’s comments, and there are several points that I intend to return to in a future post on this blog. In the meantime, please do feel free to express your own views by posting a comment.

 

 

 

Will BIS meet the compliance challenge of Osborne’s Not-A-Living-Wage?

So, George Osborne so enjoyed his upstaging of Labour on the minimum wage in January 2014 that he cunningly reprised it as the final flourish of last week’s Budget – without bothering even to consult the Low Pay Commission, that will now have the job of translating the Chancellor’s political con trick into a workable plan. (And, according to the House of Commons library, that may well require new primary legislation).

In the days following the Chancellor’s flooring of Harriet Harman in the Commons, there was a small tsunami of newspaper comment pieces and blog posts seeking to analyse the deeper consequences, both political and economic, of the move. Among the more sanguine assessments were those by former Resolution Foundation wonk James Plunkett (The UK’s minimum wage just grew up) and the LSE’s Alan Manning (The National Living Wage: a policy experiment well worth trying), while even the Living Wage Foundation managed to utter a welcome through gritted teeth.

For all this hullabaloo, Osborne’s second minimum wage coup actually didn’t advance very far on his first. In January 2014, he asserted that the UK “economy can now afford” a minimum wage rate of £7 per hour. Now – a full 18 months later – he wins acres of news coverage for committing to a rate of £7.20 from April 2016. Never have so many journalists and wonks got so excited over a difference of 20p.

Whatever, a rate of £7.20 from April 2016 is still a hike of almost 11% from the current rate of £6.50 (due to rise to £6.70 in October). So I was just a little surprised that it wasn’t until Sunday – when the Observer carried an outstanding take-down by Gavin Kelly of the Resolution Foundation – that I saw any commentator give more than passing attention to the potentially significant compliance challenge this will pose for some employers, especially in sectors such as social care where – it is commonly agreed – non-compliance is already systemic. Gavin Kelly notes:

When it comes to employers, many sectors should be able to absorb this wage hike relatively easily, despite inevitable carping. But it will pose a severe challenge in some, above all in social care, where endemic low pay means two-thirds of all care workers currently get paid less than today’s [real] Living Wage. The truly heartening news is that more than 700,000 should now receive a pay rise. The worry is that if more public funding is not forthcoming to accommodate this increased wage bill we can expect an escalation in law-breaking by employers dodging their pay responsibilities, and an intensification of service rationing for the vulnerable.

So, was there anything meaningful in the Budget to address this “severe [compliance] challenge” and likely “escalation in law-breaking by employers dodging their pay responsibilities” from April 2016? No, there wasn’t [but see comment by Craig Gordon and my response]. Indeed, as welcome as any significant hike in the minimum wage rate (except for the under 25s) must be, it’s very hard to see any underlying strategy on the part of the Chancellor, beyond providing a deeply cynical fig leaf for his poverty-inducing slashing of tax credits.

Indeed, two months after taking office, the new crop of ministers have yet to give any indication that they consider compliance with the minimum wage to be much of a priority. It is now four months since BIS named any ‘NMW rogues’ under the ‘naming & shaming’ scheme revamped by the then (Liberal Democrat) ministers in October 2013. Which – according to the answers given by BIS to parliamentary questions tabled by Ian Murray in January and Caroline Lucas this month – means there is now a ‘backlog’ of some 340 employers to be added to the 210 named & shamed to date (under the revamped scheme, all employers issued with a Notice of Underpayment by HMRC get named & shamed, regardless of the circumstances and size of the underpayment involved).

At the end of his answer to Caroline Lucas, BIS minister Nick Boles states that BIS “expects to name more employers shortly.” Which does at least suggest that ministers have not completely given up on the naming & shaming scheme. But either the next BIS ‘naming & shaming’ press release will be very long indeed (the largest to date included just 70 NMW rogues), or ministers will have to be more selective than the scheme provides for (e.g. naming only the ‘worst’ offenders among the 340+). And, from April 2016, that choice is likely to be even more stark.