How effective is ACAS conciliation? Are the Employment Tribunal fees influencing claimants?

Posted by Joanne Davies, 7th July 2016
The mandatory ACAS (Advisory, Conciliation and Arbitration Service) early conciliation scheme was introduced back in April 2014. New research recently published by ACAS suggests that seven out of ten claimants avoided going to the Employment Tribunal after receiving help from ACAS.

Under the early conciliation scheme, an individual who is thinking of commencing a claim must first contact ACAS to see if the dispute can be resolved. An Employment Tribunal claim will not be accepted unless the complaint has been referred to ACAS and a conciliation certificate issued, which confirms that the early conciliation requirements have been met. A key feature of the early conciliation scheme (which is free) is that, whilst this initial notification to ACAS is mandatory, thereafter, the scheme is voluntary. Therefore, a potential claimant can choose not to become involved in early conciliation or, if they do, can stop the process at any stage. Don’t forget that employers can also make use of the scheme, if they think that a workplace dispute is likely to lead to an Employment Tribunal claim, so do not want to waste time and costs conducting a futile negotiation process. Finally, it is important to bear in mind that ACAS conciliation continues to be available to the parties even after a claim has been lodged with the Employment Tribunal, that is post-claim conciliation.

The May 2016 research, “Evaluation of ACAS conciliation in Employment Tribunal applications 2016” clearly shows that early conciliation has been successful in reducing the need for Employment Tribunal hearings.  It is also interesting that post-claim conciliation has been very successful, possibly because the early conciliation process helped the parties to understand their respective litigation risks:

  • 71% of claimants avoided going to the Employment Tribunal after receiving help from ACAS
  • 54% of claimants said that taking part in early conciliation made it quicker to resolve their Employment Tribunal claim
  • 80% of users were satisfied with ACAS’ post-claim conciliation
  • 92% of employers and 87% of claimants said that they would use ACAS conciliation again.

As well as this research, ACAS has also published its latest “Early Conciliation update” for the period April 2015 – March 2016. This covers the second full year since early conciliation was introduced. ACAS dealt with over 92,000 early conciliation cases which is nearly 1,000 more than the previous year. It received around 1,800 notifications per week and this is an incremental rise of 100 notifications per week compared to the average received in 2014/15. The outcome of these cases makes interesting reading:

  • 17% of cases were settled through a COT3 settlement agreed with ACAS
  • 65% of disputes did not progress to an Employment Tribunal
  • 18% of cases resulted in a claim to the Employment Tribunal.

In terms of the outcome when Employment Tribunal proceedings had commenced, 33% of cases were settled with a COT3 (an agreement which records the terms of settlement of an employment tribunal claim or potential claim), 9% withdrawn, 15% determined by the Employment Tribunal and 43% are still in progress. Interestingly, one significant reason given for withdrawing a case was that the Employment Tribunal hearing fee was off putting.

Employment Tribunal fees were introduced in July 2013 and the issue fee for an unfair dismissal or discrimination claim, for example, is £250 and the hearing fee £950. Depending on their circumstances, an individual can apply for a partial or full fee remission. Employment Tribunal fees have been controversial from the outset. Unison brought judicial review proceedings challenging the fee regime, however, its application was dismissed by both the High Court and Court of Appeal. Unison has been given leave to appeal to the Supreme Court and that hearing will take place on 7 and 8 December 2016. Unison had previously argued that the striking decline in the number of Employment Tribunal claims since fees were introduced (a fall of up to 70%) showed that the fee regime was making it impossible or excessively difficult for employees to bring a claim. Furthermore, the fee regime was indirectly discriminatory in that the majority of discrimination claims were brought by women.

But it’s not just Unison that has been closely examining Employment Tribunal statistics. On 20 June 2016, the House of Commons Justice Committee (a cross-party select committee) published its report on the impact of recent changes to fees in the civil and family courts and in the Employment Tribunals. The Justice Committee’s review is not to be confused with the separate inquiry into Employment Tribunal fees by the Ministry of Justice (MoJ) which was launched in June 2015. The MoJ inquiry should have been concluded by the end of 2015 but nothing at all has been published yet. The Justice Committee describes this delay as “unacceptable” and detrimental to its work in reviewing Employment Tribunal fees.

So what were the conclusions of the Justice Committee? A specific issue it considered was whether or not the introduction of Employment Tribunal fees affected access to justice. Its view was that there has been a significant, adverse impact on access to justice for meritorious claims. Further, although one of the policy objectives of the fees regime was to transfer a proportion of the running costs from taxpayers to users (and the Justice Committee said that this was not an issue in principle), the objective of preserving access to justice must prevail over achieving cost-recovery. The Justice Committee recommended that:

  • The level of Employment Tribunal fees should be substantially reduced and the financial thresholds for determining remission of fees should be increased
  • Significantly, there should be special consideration for pregnant women and women on, or returning from maternity leave where widespread discrimination and detriment is commonplace and both the level of fees and the time limit for commencing a claim should be reviewed for those women
  • The MoJ publish forthwith the information it has collected as part of its inquiry.

It is reported that the MoJ will respond to the Justice Committee’s report in September. This should make interesting reading.

No doubt Unison will welcome the Justice Committee’s findings and may choose to make use of them at its hearing later in the year. Whether the Supreme Court will be convinced remains to be seen and we will keep you updated.

There can be little dispute however of the considerable benefits of conciliation and dispute resolution. Litigation is a stressful process for all involved, not just for the parties themselves but for witnesses too. Resolving workplace disputes without resorting to the Employment Tribunal also means less disruption to business and valuable time and money saved for the parties involved. Avoiding Employment Tribunal claims should be a priority for all organisations. As can be seen, ACAS have a very important and welcome role to play in dispute resolution but mediation is another option too.

Mediation assists two or more parties to resolve their dispute through open and constructive dialogue, in the presence of a neutral third party, the mediator. It is a voluntary and confidential process, and can usually be concluded within one full day. If the issue is caught quickly, and your aim is to improve the working relationship, Workplace Mediation can help you avoid an acrimonious grievance and/or capability process. Even if the relationship has ended, there are often many emotional issues which need to be worked through before the parties can even think about negotiating a financial settlement (which is what ACAS early conciliation focuses on). This is when Employment Mediation (a form of commercial mediation) can be highly effective.

As Employment Mediation is less adversarial than a conventional without prejudice negotiation through ACAS or solicitors, it can help bring closure for both parties as the aim is to reach a win-win outcome quickly, so the individuals involved can focus on the future positively.  Whilst the mediator might give a view of the relative merits of the parties’ legal positions, to encourage some realism on both sides, the mediator is not a judge. Ultimately, the agreement comes from those in dispute because there is usually a desire to resolve their differences “fairly”, whatever they think about their legal rights.

If you are interested in exploring Workplace or Employment Mediation, especially if there is a current interpersonal grievance or anticipated Employment Tribunal claim which might be resolved through Mediation, please get in touch.

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