The latest eye-catching figures from the UK’s Ministry of Justice show that, in the second quarter of 2014, the number of claims brought by individual employees in the Employment Tribunal was down a third from the first quarter, and down 70% on the same period in 2013.
This remarkable drop will be of reassurance to businesses, but less so to employees and executives concerned about their treatment at work. Both parties may be left wondering what factors are underlying such a large reduction in claims.
The answer is that English employment law has undergone a number of pivotal changes in recent years, and continues to do so.
Since April 2012, an employee must have at least two years’ employment to qualify for the right not to be unfairly dismissed by their employer, rather than the previous qualifying period of one year. Unfair dismissal compensation is now limited to the cap set by statute – currently £76,574 – or the employee’s gross annual salary, if lower.
In addition, since May 2014 an employee must submit any prospective Employment Tribunal claim to mandatory early conciliation before it will be allowed to proceed to the Employment Tribunal. This must be done through the government-backed workplace mediation body, ACAS, which will try to facilitate a settlement.
The final contributor to the downward trend demonstrated in the statistics is that, since Summer 2013, employees have had to pay fees to use the Employment Tribunal system: firstly on issuing their claim, and again shortly after the final hearing has been listed.
It is this latter change which appears to have had the most significant impact on the number of claims being issued at the Employment Tribunal. Given that the fees are relatively modest, it seems that those with more limited resources have been the worst affected. Certainly the requirement to pay fees and have two years’ continuous service before an employee can bring an unfair dismissal claim has resulted in huge erosion in the strength of the right not to be unfairly dismissed. This is moreover the case given the new, lower cap on awardable compensation.
It is our anecdotal experience that straightforward claims for unfair dismissal and other low value money claims have all but petered out.
However, there are, as ever, two sides to a story and the statistics do not tell them both where workplace discrimination is concerned. Whilst we primarily act for senior executives in the City, and therefore typically act on higher value disputes, we have seen no reduction at all in the number of discrimination claims. On the contrary, discrimination claims are merely evolving to reflect the ever-changing world we live in and the fact that technology has become the workplace tool of choice.
Discrimination Trends In Focus
A significant feature of claims in discrimination is that compensation for lost earnings is, in principle, unlimited. The effect is that where an employee is dismissed by the employer and the reason for the dismissal is discriminatory, the unfair dismissal cap on compensation is ‘lifted off’. Couple this with the fact that no qualifying period of employment is required for a claim in discrimination and it is possible to understand why allegations of discrimination are increasingly raised by employees in connection with workplace disputes.
Indeed, there was a concern that the limitations on the right to claim unfair dismissal would result in a whole host of spurious discrimination claims. Only time (and more detailed statistics from the Ministry of Justice) will tell but that has not been our experience to date. We find that most employee clients appreciate the seriousness of making an allegation of discrimination and are therefore reluctant to throw it into the mix unless they feel very strongly about it.
The ‘protected characteristics’ in relation to which employees have the right not to be discriminated against have been settled law for some time now and, generally speaking, examples of overtly discriminatory behaviour in the workplace have become much rarer.
This is likely to be a result of a combination of factors: most of the anti-discrimination legislation has now had a good amount of time to ‘bed-in’; the media continues to highlight cases that have fallen foul of the law and the reputational issues at stake, as in Carol Howard’s recent high profile claim against the Metropolitan Police; many employers have invested in equality policies and training for their staff; and there is a resulting increased perception amongst employees of what is and is not acceptable behaviour at work.
A noted exception to this is in relation to the protected characteristic of age, where workplace understanding still appears to be playing ‘catch-up’ to some extent. Employers and their employees continue to commit acts that are not ‘age neutral’, in a way that they would not think to in connection with, for example, the protected characteristics of race or disability.
It is, in our experience, still relatively common for employers to overlook candidates for promotion because they are too young, or to want to manage out employees because they are considered to be too old. In some ways this reflects what is acceptable in society more widely. For example, one can still readily buy birthday cards that ridicule the recipient’s age, albeit in a light hearted way. Although John McCririck was unsuccessful in his age discrimination claim against Channel 4, prevailing attitudes and behaviours such as these may, we believe, mean that the heyday of age discrimination claims is still to come.
Similarly, where pregnancy and maternity-related discrimination is concerned, although usually subtle rather than overt, employers continue to demonstrate a reluctance to treat employees with such protected characteristics in an equal way to those without them. For example, at the prospect of a mother’s return to work after maternity leave. Many businesses still consider that women should be grateful for the fact that they are allowed to take maternity leave and should therefore take what they are given on their return. Few of these cases make it to trial as businesses quickly realise how bad they will look if their unlawful practices are unveiled to the public.
Discrimination & New Media
Whilst overt acts of discrimination in the physical workplace may be becoming rarer, digital social media presents an ever-growing headache for employers, given the blurring of lines between what is public or private, work-related or personal, and the ease with which social media can be accessed by employees bringing their own, unregulated, devices to work.
A key issue for employers is whether or not a social media posting by an employee amounts to discriminatory conduct for which the employer can be held liable.
The Employment Tribunal’s decision in Otomewo v Carphone Warehouse Ltd illustrates this. Mr Otomewo was a manager at Carphone Warehouse. Two of his colleagues posted a status update on his Facebook page which read “Finally came out of the closet. I am gay and proud”. The comment was posted during working hours, using Mr Otomewo’s phone without his permission whilst it was in the shop’s back office.
The Tribunal held that the status update on his Facebook page had the effect of creating an offensive working environment for him. It ruled that the employer was liable for the conduct of its employees (they said it was done in the course of their employment), which amounted to harassment on grounds of sexual orientation. This was notwithstanding that Mr Otomewo is not gay and his colleagues knew this.
Whilst it is of course essential for employers to have social media policies in place, this case demonstrates that participatory training and education of employees as to what is and is not acceptable use of social media is of key importance to employers as experience shows that understanding, and thus prevention, is better than cure.