Law guide: Employment

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The hearing

The hearing

Contents

The hearing

The Employment Tribunal will normally consist of three members: a legally qualified employment judge (or chairman in Northern Ireland) and two lay members. In certain circumstances in England, Wales and Scotland, the hearing can be held before an employment judge alone, such as in claims for unfair dismissal.

The employee may appear in person, or be represented by a professional adviser. Public funding (or 'legal aid' in Northern Ireland) is not available for representation at the hearing in England or Wales. A specific type of legal aid is available for representation at a hearing in Scotland.

Generally, if it is alleged that there has been a constructive dismissal, then the employee will open the case, as the burden of proof will be on the employee to establish that in the circumstances, they had no alternative but to terminate their employment.

However, if there is no dispute as to the fact that a dismissal occurred, the employer will have to start the case and present evidence to show that the dismissal was fair and reasonable in the circumstances.

The general rules of procedure and evidence are not as formal in the Employment Tribunal as they are in the county courts or sheriff courts (in Scotland). However, the witnesses must still give evidence under oath and can be convicted of perjury if they lie. In England, Wales and Northern Ireland, the Employment Tribunal typically encourages parties to draft and exchange witness statements. This is not standard practice in Scottish Employment Tribunals and witness statements are usually not drafted.

Another feature of the proceedings in England and Wales and Northern Ireland is that it is usual for a witness to be asked supplementary questions by their representative. What follows is a question-and-answer procedure where the witness is cross-examined and then re-examined (asked further questions) by the side that the witness is giving evidence for. The Employment Tribunal may intervene and ask questions of a witness at any time (although this does not generally happen in Northern Ireland).

In Scotland, evidence is heard by the Employment Tribunals in a different way than in England and Wales. A witness's evidence is heard by the tribunal as the representative acting for the employee/employer (depending on who the witness is appearing for) asks the witness questions. Then, the witness is 'cross-examined' by the representative for the other side. Finally, the witness can be re-examined by the representative who started asking questions. The Employment Tribunal may intervene and ask questions at any time but may also wait until all the questions from the representatives have been asked before asking any questions it may have.

At the end of the hearing, each party is entitled to make a closing speech, which basically sums up the evidence and reminds the Employment Tribunal of the relevant factual and legal positions.

If the Employment Tribunal decides a complaint of unfair dismissal in the employee's favour, it can make an award of reinstatement, re-engagement or compensation. Sometimes an Employment Tribunal will just give a judgment regarding whether or not the employer is liable to pay compensation and then adjourn the case to allow both parties to reach an agreement on the amount of compensation that should be paid. If the parties are unable to agree then they may return to the Employment Tribunal to attend a further hearing to decide how much should be paid.

At this hearing further evidence will be heard relating to the losses if this issue has not already been dealt with. Once all the evidence has been heard, the Employment Tribunal will generally adjourn for a short while to make their decision in private.

The Employment Tribunal may then give an oral decision immediately and follow this with written reasons either in summary or in full.

In complex cases, a decision may be reserved for a later date, in which case the hearing will be adjourned until further notice from the Employment Tribunal.

Settlements

Many complaints are settled without a hearing. Any provision in an agreement is unenforceable if it:

  • attempts to exclude or limit the operation of any provisions of the Employment Rights Act 1996 (or Employment Rights (Northern Ireland) Order 1996), or
  • precludes a party from any proceedings under the Act (or Order) before an Employment Tribunal.

However, this will not be an issue:

  • Where the parties have used the conciliation service offered by the Advisory, Conciliation and Arbitration Service (Acas) (or the Labour Relations Agency (LRA) in Northern Ireland). In which case Acas (or the LRA) conciliation officer will draft an agreement (referred to as a 'COT 3' in England, Wales and Scotland) on behalf of the parties having ensured that both parties understand the effect of the settlement. The conciliation officer does not have a duty to ensure that the settlement is fair, but he or she must be involved in promoting the settlement.
  • Where the parties are legally represented, a 'settlement agreement,' is used to settle the claim.

A settlement agreement must comply with the following conditions:

  • It must be in writing, identify the employee's adviser, relate to the particular complaint and state that the conditions are satisfied
  • The employee must have received advice (usually, but not necessarily, paid for by the employer) from a relevant independent adviser as to the terms and effect of the proposed agreement, and in particular, its effect on the employee's ability to pursue rights before an Employment Tribunal
  • When such advice is given, the contract of insurance or an indemnity provided for members of the professional body must be in existence, covering the risk of a claim by the employee should he or she suffer loss as a result of the advice that he or she was given

A person is a relevant independent adviser if:

  • They are a qualified lawyer (a barrister or solicitor who holds a practising certificate)
  • They are an officer or official, employee or member of an independent trade union who has been certified in writing by the trade union as competent to give advice
  • They are an employee or volunteer who works at an advice centre and have been certified in writing by the centre as competent to give advice
  • They are a person of a description specified in an order made by the Secretary of State

Where an agreement is concluded either through a conciliation officer or as a settlement agreement, any proceedings will normally be adjourned.

If you comply with the agreement, your employee is barred from continuing with the complaint. If you do not comply with the agreement, your employee can either return to the Employment Tribunal to continue with the complaint or they can proceed in a county court or the High Court, or (in Scotland) the sheriff court or the Court of Session and sue you for breach of contract.

In the event that the employee breaches the terms of the agreement, you will likewise have remedies in the civil courts.

If your employee has already presented a claim to the Employment Tribunal and the matter has been settled, they need to withdraw their claim and this can be done in one of two ways:

  • Terms of the settlement may be recorded and registered with the Employment Tribunal and a special form is completed and submitted to it
  • Your employee, as the applicant, can merely decide to withdraw their application to the Employment Tribunal. A specific form can be used or a letter can be addressed to the Employment Tribunal notifying them of the settlement and requesting that the claim been withdrawn

Arbitration

England, Wales and Scotland

An alternative to applying to an Employment Tribunal is the adjudication of the dispute by Acas.

This option is currently only available for claims involving unfair dismissal or flexible working. An independent arbitrator hears the case and delivers a legally binding decision in favour of one party. Arbitration is a voluntary process, available where both parties agree to sign up to the scheme and abide by the arbitrator's decision.

Benefits of ACAS arbitration include:

  • A speedy, private, informal hearing
  • No cross-examination
  • Limited grounds for review of the arbitrator's decision

Northern Ireland

An alternative to an Employment Tribunal in Northern Ireland is the adjudication of the dispute by the LRA. This option is available for resolution of most cases, including those involving redundancy payments, discrimination, owed payments, unfair dismissal, constructive dismissal and flexible working disputes. An independent arbitrator hears the case and delivers a legally binding decision in favour of one party. Arbitration is a voluntary process, available where both parties agree to sign up to the scheme and abide by the arbitrator's decision. However, by selecting this option both parties waive their rights to take the case to tribunal.

Benefits of LRA arbitration include:

  • A speedy, confidential, informal hearing
  • Non-legalistic
  • The arbitrator's decision is final and binding

Please refer to the LRA website at LRA website for more details of the service that is available.

Costs

In exceptional circumstances, an Employment Tribunal may award costs if it considers that one of the parties has acted unreasonably.

Employment Tribunals have the power to order costs of up to £20,000 if they believe that a party has acted abusively, vexatiously, disruptively or otherwise unreasonably. In the light of this power, the employee will have to be absolutely sure that a valid claim exists before any action is taken. If not, the employee will be exposed to the risk of a costs order (or in Scotland an Order for Expenses).

If your employee represents themselves at an Employment Tribunal, they can claim from you a fixed hourly rate for their preparation time (e.g. time spent preparing for a tribunal hearing). They can also claim the costs incurred for paying any of their witnesses' expenses. However, they must apply for such an order before they can claim these costs from you.

Financial penalties for employers (England, Wales and Scotland)

Employment Tribunals have a discretionary power to order you to pay a financial penalty if you lose the case. Before imposing the penalty, the tribunal must decide if there have been 'aggravating features', e.g. if you fail to cooperate with your employee or with the tribunal.

Even if your employee has not been awarded any compensation, the court can still order a financial penalty against you. If your employee has been awarded compensation, the financial penalty must be 50% of the award. This will also be the case if there are a number of individual claims made against you by your employees that have been joined together by the tribunal.

The penalty must be for a minimum of £100 and no more than £5,000. You do not have to pay the full penalty if you pay half of it within 21 days. However, before ordering the penalty, the tribunal will first consider whether you will be able to pay it.

Review of decisions and appeals

In certain circumstances, an Employment Tribunal may review its decision and can confirm, vary or revoke it. These circumstances are:

  • The decision was wrongly made as a result of administrative error
  • A party did not receive notice of the proceedings leading to the decision
  • The decision was made in the absence of a party
  • New evidence has become available since the conclusion of the hearing to which the decision relates, provided that its existence could not have been reasonably known of or foreseen at that time
  • The interests of justice require such a review

A tribunal will not review its decision merely because a party disagrees with that decision.

A party may apply to the tribunal at the hearing immediately after the decision has been given or they may send it a written request for a review which the tribunal should receive within 14 days of the date on which the decision was sent to the parties.

In England, Wales and Scotland, if the unsuccessful party believes that the decision of the Employment Tribunal is incorrect on a point of law, they have a right of appeal to the Employment Appeal Tribunal (EAT) and this must be made within 42 days of receiving the full reasons for the Employment Tribunal's decision.

See the EAT website for more information on the appeals process

In Northern Ireland the parties have a right of appeal to the Court of Appeal against the decision of an Employment Tribunal on a point of law. Written notice must be given to the Secretary of Tribunals within 42 days of the date on which the tribunal's decision was issued and the notice must specify the point(s) of law relied upon. Any application to extend the time limit can only granted by the Court of Appeal. Where the tribunal is satisfied that the request does contain a genuine point of law, it must refer the matter to the Court of Appeal.

Enforcing judgments

If the Employment Tribunal issues a Judgment, and either the employer or employee does not comply with it, then further steps need to be taken in order to enforce it.

In England and Wales, the judgment will need to be transferred to a county court for it to be enforced. In Northern Ireland judgments are enforced by the Enforcement of Judgments Office.

The steps which must be taken are different in Scotland and specialist advice should be taken about how to enforce a tribunal's judgment.

Overlapping claims

Although more than one claim may be available to your employee, it does not mean that they will receive compensation for the same loss twice and the Tribunal will take any payments already made into account. For example, if the employee receives a compensatory award for unfair dismissal, the immediate and future loss of wages makes up a substantial part of that award.

Therefore, if the same employee also had a claim for breach of contract, the damages awarded would be reduced accordingly as a substantial portion of the loss for the unfair dismissal would have already been awarded.