Financial & Legal News

The cost of defending Employment Tribunal claim

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Employment tribunals can have an impact on your business, but the bottom line is how much has to be paid to employees and that can range from £5,000 to over £35,000, as seen in two recent cases.

Employment Tribunal injury to feelings

These are employment tribunal cases focusing on injury to feelings awards which ostensibly seemed on the surface to be very similar, however the settlements made are varied.

In one case the employee suffered “feelings of indignation” at the employer’s conduct and got £5,000.  Yet in the second case the staff member felt rejected, isolated and ridiculed and they received a settlement of £35,000 when it was found the employer had created a “hostile environment”.

In each of these cases the Employment Tribunal awarded the compensation it felt was appropriate to the situation.

“Workplace disputes are inevitable but how they are managed from the outset can make or break a business,” warned Head of Employment Law Susan Mayall.

“We work with a number of large business owners and their HR teams on a regular basis to keep them out of the tribunal and hand hold them through to process when an employee is disgruntled.  I would also like to think we actually prevent things from escalating by having a clear set of policies and procedures for our employer clients and making sure they follow all the correct steps.

Although it does come down to finances, there are also workplace tensions, reputation and the smooth running of the business that can be impacted if an employee is disgruntled and takes their boss to tribunal. The Equality Act 2010 states that a tribunal can make an award for an employees injured feelings resulting from discriminatory treatment,” added Susan.

What happens at an Employment Tribunal?

Employment tribunals are usually comprised of a panel that includes an employment judge and two non-legal people, these usually have business experience.  After hearing from witnesses for both the employer and the employee the tribunal panel will then reach a legally-binding decision.

There are three band awards to help guide tribunals:

  • Lower Band - for less serious, one-off cases.
  • Middle Band - for discrimination that’s moderate in duration.
  • Upper Band - for the most serious cases

The compensation award is made up of a ‘basic’ award and a ‘compensatory’ award. The former depends on how long the employee has worked for the business, as well as their age.  The compensatory award is normally capped at a maximum of £93,878 or one year’s salary, whichever is lower.

Age discrimination tribunal cases

In one case we dealt with age discrimination was an issue for a national company.  The case in point was a young employee aged under 25 who was subject to nine days of what he said was uncomfortable, belittling and humiliating behaviour as a result of the actions of a rogue manager who called him a ‘little boy’ and ‘kid’.  In this case the young staff member was awarded £36,000.

In another age discrimination case, the comments and behaviour were far worse but the HR team involved, with much support from Pearson Employment Law solicitors, managed the process and resolved the case to answer with no ongoing problems.

“What this shows is that if such issues are raised in the workplace, subject to them being dealt with promptly, fairly and reasonably, they can be managed with little cost or reputational damage,” said Susan Mayall.

How can we help employers

Our employment solicitors work with businesses to guide them through the entire process. We try and find alternative ways to deal with disputes and a tribunal really is the last alternative.  Susan and the employment law team will guide you through every step of the way and if it does result in a tribunal we provide specialist support you and your business.

If you are a business owner, HR manager or an employer in need of legal advice our Employment Law Solicitors can help. Contact our team on 0161 785 3500 or email them at employment@pearsonlegal.co.uk.

Please note that the information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Pearson Solicitors and Financial Advisers Ltd or any of its members or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.

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