Schools that are properly prepared for employment tribunal hearings can minimise cost and maximise their likelihood of success, writes Tamara Ludlow

Most employment claims are heard in the employment tribunals. The process can be daunting for those involved, whether they are legally represented or not. The tribunal is more informal than the civil courts, but increasingly regulated.

Those who properly engage in the litigation process at an early stage are more likely to succeed — or at least to minimise cost and management time. This article is a guide to tribunal procedure — to allow your school, if faced with a claim, to engage as successfully as possible.

The claim

The claimant must submit the claim on the prescribed form ET1 and within the relevant time limits (or apply for an extension of time).

For certain claims the claimant must comply with the statutory grievance process before filing the claim in the employment tribunal.

Where it is obvious to the tribunal that the statutory procedures have not been complied with, the tribunal will return the ET1 to the claimant, saying why it has not been accepted and asking for resubmission if and when appropriate.

Otherwise the tribunal will accept the claim and send the claimant an Acknowledgement of Claim notice. It will then send to the respondent a copy of the claimant’s ET1 under cover of a Notice of Claim.

The response

It is a good idea to diarise the date for submitting a response (i.e. defence to the claim, if any) when you receive a claim. Employers have 28 days to respond from the date the claim was sent to them — not from the date it was received.

The tribunal will usually calculate the deadline for submitting the response and include it in the Notice of Claim. If not, it is perfectly acceptable to telephone the relevant tribunal office and ask for confirmation of the deadline.

Extension of time
If it will be difficult to comply with the deadline, then apply to the tribunal for an extension of time. You must do this before the deadline for filing the response expires.

Do not allow the deadline to pass without submitting a response or, if you have applied for an extension, without confirmation that this has been granted.

Failure to file a response can lead to the tribunal issuing a judgment in favour of the claimant without a hearing. This means that the respondent will be held automatically liable, with the tribunal considering only how much compensation is payable.

You must submit the response on the form ET3.

What should we include in the response?
There is no right way to draft a response. Some lawyers prepare comprehensive and lengthy documents including much background information; others give only a short rebuttal.

It can be useful to draft the response by reference to the paragraphs in the claim (using the same numbering if appropriate). It is advisable to set out at an early stage what is admitted and denied.
Where the position is as yet unclear the use of ‘not admitted’ may be helpful.

For example: ‘It is admitted that the claimant was dismissed by the respondent. It is denied that the claimant was dismissed because she was pregnant. It is not admitted that the claimant’s previous line manager, John Smith, told her she would be dismissed if she fell pregnant; Mr Smith is no longer in the respondent’s employ and further enquiries will be undertaken to verify the respondent’s position. The respondent reserves its rights to amend its response in this regard.’

Pre-hearing review

This is a preliminary hearing. Pre-hearing reviews are held to:

  • decide whether the claim or response should be struck out
  • decide questions of entitlement to bring or defend a claim
  • decide, if either side’s case appears weak, whether that side should pay a deposit, and if so, how much, before that side can go ahead

Employers should consider, at the time of drafting the response, whether a pre-hearing review may be necessary — whether, for example, early adjudication of any issues arising could bring the proceedings to a swift end.

Pre-hearing reviews can be listed upon application by either party, or by the tribunal of its own volition. If a PHR is necessary, the tribunal will send a Notice of PHR with details of the hearing and matters to be decided.

Unless the PHR is only to consider whether a deposit should be paid, formal evidence will be given, both witness and documentary. The PHR can become a mini-trial encompassing the same stages as the full hearing (see below). This is particularly so where the issue to be decided affects whether the claim can proceed or not.

PHRs are normally held in public before an employment judge (formerly known as tribunal chairman) sitting alone, but may be held over the phone.

Conciliation and settlement

In the early stages, it is a good idea to consider settling the claim. This may seem unpalatable. The employer may feel it is being blackmailed by an employee with no proper cause of action — but legal action is disruptive and costly. Early settlement will, in most cases, save money and management time.

ACAS
Employers should consider enlisting the assistance of the Advisory, Conciliation and Arbitration Service (ACAS) over settlement. ACAS has a legal duty to offer conciliation (which is free and confidential) to parties in tribunal cases, or where a tribunal claim could be made.

Once a claim is issued, an ACAS conciliator is allocated to the claim and will usually contact the parties by letter to offer assistance.

Until recently fixed conciliation periods applied but now ACAS conciliators can assist with settlement until the date of hearing.

The ACAS conciliator will:

  • inform both parties what the legal issues are
  • explain tribunal procedures
  • act as a neutral observer and sounding board between parties
  • act as a neutral channel of communication between the parties or their representatives, to explore whether an acceptable, legally binding settlement can be reached, avoiding the need for a tribunal hearing

The conciliator is independent and does not represent either party.

Form and content of the settlement
If an ACAS conciliator acts on a settlement s/he will usually record the agreement on a form COT3. The conciliators can assist with drafting these but it is a good idea to obtain legal advice so that all claims are waived, confidentiality is agreed and that appropriate tax indemnities are included.

Any agreement to settle or waive statutory claims will be void unless it is agreed through ACAS or recorded in a compromise agreement that complies with statutory requirements. There are only limited circumstances in which it might be advisable to make a payment to a claimant without a contractual agreement to waive claims. Take legal advice about this.

When considering settlement, with ACAS or otherwise, it is helpful to have some idea of (1) how likely it is that the claim will succeed and (2) the value of the claim if any. Without legal advice it will be difficult for most employers to assess these. A starting point is to oblige the claimant to quantify his or her loss.

Common issues decided at PHRs

  • is the claimant an employee or self-employed?
  • is the claimant time-barred from bringing the claim?
  • does the tribunal have jurisdiction to hear the claim? (This issue often arises where employers argue that the claimant has not submitted a grievance in time, or at all, and in breach of statutory requirements.)

Case management discussion

This is another type of preliminary hearing. Again the parties can apply to have a CMD, or the tribunal can list one of its own volition. CMDs are conducted to:

  • clarify the issues in the case
  • decide what directions orders should be made about documents and witnesses
  • decide the time and length of the full hearing

The case management discussion will normally be held in private, before an employment judge sitting alone, or over the phone. It is nearly always cheaper and more convenient to hold hearings by phone — either party can apply for the CMD to be conducted this way.

If a CMD is necessary, the tribunal will send the parties a Notice of CMD with time and place of the hearing. The tribunal may ask the parties to agree matters as much as possible ahead of the CMD, and to be prepared to present a list of legal issues.

Directions

In straightforward cases, case management directions orders are often sent out to the parties by letter. These orders will have been made by an employment judge on the basis of the papers on the file — the parties will usually have had no input. Either party can apply to have the orders varied or amended as appropriate.

Otherwise, directions orders are made at the case management discussion, usually after hearing representations from both parties.

Common directions orders
Disclosure: both parties have to exchange documents on which they intend to rely in bringing or defending the claim.

There is not the same onerous duty to disclose all documents as applies in the civil courts, but the tribunal will not look kindly on parties who withhold relevant documents that are detrimental to their case.

Early disclosure assists early resolution and the tribunal could refuse to admit evidence that is not disclosed in breach of an order. There is a continuing duty of disclosure where documents are, say, discovered late in the day.

Inspection: once the parties have disclosed documents it is important to review (or ‘inspect’) the documents and consider whether there are any that are obviously missing.

Respondents should be aware, though, that in terms of any later arguments that the claimant has not mitigated his or her loss properly, the tribunal will look to the respondent to bring evidence that there were suitable jobs for which the claimant has failed to apply.

For example: In discrimination or stress claims: has appropriate medical evidence been supplied? Has the claimant provided evidence that his or her losses are what s/he says they are? Has the claimant supplied evidence of attempts to find alternative employment?

Bundle: the parties will often be directed to agree a hearing bundle. It is usually ordered that the respondent prepare the bundle. It is preferable to have control of preparing the bundle. Respondents should consider, for an order, that the claimant contribute to the costs of preparation. The bundle will need to be paginated and an index prepared.

Exchange of witness statements: this can be mutual or sequential depending on the tribunal order and any requests made by the parties. Where mutual exchange has taken place, the tribunal may allow for further witness statements to be drafted in response.

Schedules of loss: if this is not ordered at an early stage, the respondent should ask the claimant to provide it, and where appropriate apply for an order. Respondents should also consider asking for documentary evidence of loss claimed if this has not already been provided by way of disclosure.

Other common directions and orders: tribunals often order the parties to prepare and agreed cast list and chronology of events, which may be combined with a list of agreed and disputed facts. Tribunals can also make orders for obtaining expert evidence (often medical evidence) and obliging a witness to attend.

There are sanctions for failure to comply with orders that can include a fine of up to £1,000 or a claim or response being struck out. Tribunals do not readily impose these sanctions and parties are more likely to be penalised with a costs award.

Full hearing

This is the hearing to determine liability, and where possible remedies and costs. These hearings are before the full tribunal panel: an employment judge and two lay members who have been chosen for their experience in industrial relations.

In an unfair dismissal case the respondent will give evidence and call any witnesses first, while in a discrimination case the claimant will normally be first to give evidence followed by any witnesses.
Witnesses will have to give evidence on oath or affirmation, and will be asked to read out their witness statement to the tribunal. The other side can then cross-examine. Parties are usually legally represented. After cross-examination the witness may be re-examined if necessary to clarify matters.

The judge may ask the witness questions during the giving of evidence and will usually ask questions at the end, as will the lay members.

Once all the evidence has been heard, both parties can sum up. This can be done orally or in writing, or both. The tribunal then considers its judgment. Unless it reserves judgment, the judge will announce the decision at the end of the hearing. If judgment is reserved, it will be sent to the parties later.

If the claim is successful the tribunal will assess compensation at the hearing. In more complex cases it may hold a specific remedies hearing.

The judgment

The tribunal will always send parties a written judgment. This will not necessarily include the reasons, which will be given if requested at the hearing or where a written request is made within 14 days of the judgment being sent out. It is always advisable to request written reasons at the tribunal.

Costs

In most tribunal cases, each side will pay its own costs. The tribunal may order one side to pay the other’s costs — for example, if one side has behaved unreasonably in conducting the case, or if a tribunal thinks that a claim was so weak it should not have been brought.

Costs are more frequently awarded to respondents, but even then in only about 1 per cent of cases. The issue can be dealt with at the main hearing or at a separate costs hearing.

Reviews and appeal

Either party can ask a tribunal to review specific decisions or orders: for example, a decision to strike out a claim or response. This is a separate process to a review of a default judgment made where the respondent has failed to file a response.

Either party may appeal a tribunal decision to the employment appeal tribunal (EAT) on a point of law only. Parties cannot appeal because they are dissatisifed with the outcome.

The EAT will not interfere with the tribunal’s findings of fact unless these are ‘perverse’ — i.e. the tribunal reached a conclusion that no tribunal could properly have reached on the facts before it (an error of law).

Appeals to the EAT are governed by Employment Appeal Tribunal Rules 1993 as amended, and by the EAT president’s practice direction.

Find out more

  • ACAS
  • www.employmenttribunals.gov.uk
  • www.employmentappeals.gov.uk

Tamara Ludlow is a solicitor in the employment department of Finers Stephens Innocent

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