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.

 

 

Lies, damn lies, and Acas statistics?

One variant of the phrase usually (but erroneously) attributed to Mark Twain is that there are liars, damned liars and experts. Which is fine with me, because I claim no expertise in anything. So the first thing that struck me this morning, when casting an eye over the latest early conciliation statistics and independent evaluation report released by Acas, is that the good people in Euston Tower happily describe themselves as the “workplace expert”.

Not that I dispute that description, and it’s probably worth stating at the outset that, like most people with an interest in workplace dispute resolution, I welcomed and supported the evolution of the early conciliation regime provided for in sections 7 to 10 of the Enterprise & Regulatory Reform Act 2013 from the pre-existing, Acas pre-claim conciliation service. An employment tribunal claim should always be a remedy of last resort, and any provision by the State to help resolve disputes without recourse to a time-consuming, stressful and costly tribunal claim is to be welcomed. So I’m glad that, 12 months after implementation of the early conciliation regime, Acas feels able to proclaim the regime a “success, with high take-up and satisfaction rates”.

However (go fish, Mr Gove), the second thing that struck me this morning was the high number of early conciliation notifications (or ‘cases’) over the first year of operation – 83,423 – relative to the number of tribunal cases over the same period and, indeed, in previous years. In 2012-13, the last full year before the introduction of fees in July 2013, there were just 60,040 tribunal cases (single claims/cases + multiple claimant cases).

So – in a desperate and probably doomed attempt to keep Gem Reucroft happy – I have put the quarterly Acas figures into the following chart. The green columns show the actual number of tribunal cases (single claims/cases + multiple claimant cases), while the blue columns show my projection of the number of tribunal cases we could have expected, had both fees and ‘mandatory’ early conciliation by Acas not been introduced. As previously discussed on this blog, this assumes a continuation of the modest ‘historical downward trend’ in single claims/cases that started in 2010, and about which the Ministry of Injustice – having somehow failed to notice it in 2012 and 2013 – now has so much to say.

More controversially, perhaps, it also assumes that the sharp drop in multiple claimant cases in mid-2013 was largely coincidental to the introduction of fees, and simply reflects the slowing down (and confinement to Scotland) of what the Daily Mail would call The Equal Pay Claim Gravy Train. So it includes the actual number of multiple claimant cases.

Finally, the orange columns show: (a) the average number of Acas pre-claim conciliation referrals, in each quarter up to Quarter 4 of 2013-14 (as I can only find annual statistics); and (b) the number of early conciliation notifications (or ‘cases’) in each quarter since April 2014. And from this we can see that the number of early conciliation notifications far exceeds not just the actual number of tribunal cases, but also the number of tribunal cases we could have expected, had both fees and early conciliation not been introduced. Indeed, in each of the two most recent quarters, the number of notifications was almost twice the number of tribunal cases we could have expected.

Acas

From which we could perhaps conclude that Acas might well be hoovering up, and spending resources dealing with, a fair number of ‘disputes’ that would not have resulted in the issuing of a tribunal claim in any case. We probably need to take account of the number of voluntary pre-claim conciliation cases successfully resolved by Acas in the past before we do reach such a conclusion, but the chart suggests we may need to take a long, hard look at the assertion that the early conciliation regime introduced in April 2014 has been a “success”, at least in terms of reducing the number of tribunal cases (i.e. the principal aim of the policy).

Acas states that the independent evaluation research “found that nearly half of all claimants (48%) who used early conciliation either reached a formal settlement or were otherwise helped by Acas to avoid a tribunal claim”. But if that 48% figure is applied to the total number of notifications in the two most recent quarters (45,498), the resultant number of potential tribunal cases left over (23,659) is only marginally different to my projected number of tribunal cases over those two quarters (23,526), had fees (and early conciliation) not been introduced. In other words, take fees out of the picture, and the introduction of ‘mandatory’ early conciliation by Acas appears to have had little if any impact on the number of tribunal cases.

As noted by Darren Newman on Twitter (in response to the original version of this post), there is some evidence in the evaluation research report that Acas is indeed now hoovering up a significant number of cases that would not have resulted in a tribunal claim. The researchers found that one in four (24%) of claimants described their reason for making an EC notification as “being that they ‘Just wanted to see if a settlement could be reached, and did not have a desire to submit an employment tribunal claim'” (see page 33 of the report).

Anyway, not being an expert, I’ve probably missed something rather obvious here. So I await a gleeful email or direct message from Michael Reed, following which I will rewrite this post.

ET fees: Ministry of Injustice starts hunt for the X Factor

So, the Ministry of Injustice has finally decided to launch its long-promised review of the employment tribunal fees introduced in July 2013. This is the review, you might remember, that the Ministry was busy “finalising” the timing and scope of as long ago as June 2014. And it’s no doubt entirely coincidental that, next week, the Court of Appeal will hear Unison’s appeal against the High Court’s dismissal of their application for judicial review of the fees regime.

The wording of today’s announcement provides little cause to think that work-starved employment  lawyers should hold their breath until the outcome of the review. To my jaundiced eye, the stated terms of reference suggest the Ministry will be scouring all kinds of tribunal and economic data for any factor – other than the fees, obviously – that might possibly have contributed, even just a tiny bit, to the sharp decline in ET case numbers since July 2013. So the Ministry’s finest minds will be studying the “historic downward trend” in the number of ET claims – you’ll no doubt remember how much Vince Cable and other ministers made of that trend in late 2011 and 2012 – as well as the impact from “the improvement in the economy” and “changes to employment law”.

I’ll come back to those factors in a minute, but today also saw the scheduled publication of the latest set of quarterly ET statistics. These new figures remind us just how big the fall in case numbers has been since July 2013. And, perhaps more interestingly, especially to the crack employment team at top 100 law firm Hugh James, they suggest that exploited and mistreated workers, having ‘acclimatised’ to the fees in Q3 of 2014-15, somehow de-acclimatised in Q4. I’m looking forward to reading about this in the Law Society Gazettebut meanwhile here’s a chart.

ETquarterly110615

But back to those legal and economic factors (other than the introduction of hefty, upfront fees in July 2013) that – three, six or maybe 24 months from now – the Ministry will no doubt inform us wholly explain the fall in ET case numbers since July 2013. As is evident from the above chart, and as reported ad nauseam on this blog, there was a modest downward trend in ET case numbers in the quarters immediately prior to the introduction of fees, quite possibly linked to the steady improvement in the economy in recent years. From Q2 of 2012/13 to Q1 of 2013/14 – the last full quarter before fees – the number of new single claims/cases declined by 5%, from 13,407 to 12,727.

I imagine the Ministry boffins will find no reason to assume that that modest downward trend would not have continued, had fees not been introduced in July 2013. Indeed, they may well find reasons to argue that it would have accelerated. So, let’s assume that, over the next three quarters, single claims/cases declined by 6%. In that scenario, the number of such claims/cases would have fallen to 11,963 by Q4 of 2013/14, the last full quarter before the implementation of Acas early conciliation (from 6 April 2014). And – if that 6% rate of decline continued – by Q4 of 2014/15, the quarter for which the figures were published today, single claims/cases would have fallen to 11,010. Which, it’s worth noting, would have been a record low, unseen since the passing of the first Corn Laws in 1815.

Now, that implementation of Acas early conciliation (which became mandatory in May 2014) may well be what the Ministry had in mind when referring, in the review’s terms of reference, to the impact on ET case numbers of “changes in employment law”. Because the primary aim of Acas early conciliation was to reduce the number of claims/cases by a whopping 17% (that being the figure given in the final BIS impact assessment). So, from Q1 of 2014/15 onwards, we need to reduce the number of single claims/cases in my ‘no fees’, downward trend projection by 17%. And, if we do that, we get the following chart, in which the green columns represent the number of single claims/cases we might have expected to see in each quarter, had fees not been introduced, and the red columns represent the actual number of such claims/cases.

ETprojection110615

We can total up the differences between the red and green columns, and that gives a figure of 36,210 single claims/cases ‘lost’ to ET fees between 29 July 2013 and 31 March 2015, after allowing for the ‘historic downward trend’ in case numbers and the introduction of Acas early conciliation. And that figure continues to increase by some 5,000 every quarter (so is, at the time of writing, in excess of 40,000).

Now, I can’t think of any other significant (and relevant) change in employment law since July 2013, and I have difficulty imagining what “changes in users’ behaviour” might explain more than a tiny bit of the difference in the height of the green and red columns in recent quarters (there is no evidence to suggest that displacement of single claims/cases to the County Courts has been more than negligible). So I think I’ve just about done the Ministry’s job for it. For nothing. In an afternoon.

But perhaps the Ministry’s boffins will find some X Factor I have stupidly overlooked.