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Mr Osborne told the Sun newspaper, "We talk a lot about trade union rights- but what about the rights of the unemployed person to be given a shot at a job and a career? What about the rights of people currently sitting at home with nothing to do desperate to get to work, but the business can’t afford to employ them because they fear they are going to be taken to a tribunal?"
Reaction to the reform has been mixed with the CBI saying that it would give small business more confidence to hire people. Unions however took a different view suggesting that workers’ rights are being eroded for very little economic gain.
So do the reforms lead the way to greater employment opportunities? The economic benefits are very difficult to assess. It’s hard to see how it will boost employment although employers will be pleased to see a reduction in risk for them is it likely to protect employers from employment tribunal claims? John Philpott the chief economic adviser for the CIPD thinks not. He said that it was unlikely that raising the unfair dismissal threshold would ever reduce the overall number of employment tribunal claims because employees are increasingly bringing claims that link unfair dismissal with discrimination. Under the plans employees will still be able to make discrimination claims from day one of employment.
So if this is the case what is an employer to do? In my experience by the time an employer gets to an employment tribunal everyone loses aside from the lawyers. Careers can be ruined, relationships between employees and their employers become so strained that there can be little hope of reinstatement and reputations can be tarnished both for individuals and an organisations employment brand.
Having helped many organisations who have experienced the difficulties of employment tribunals there are a number of elements. Employment tribunals are usually a symptom of an underlying issue. This may include unclear expectations of both staff and managers, a poor strategy for communications or the inability to provide appropriate feedback to underperforming employees.
The most usual problems in my experience stem from a combination of poor recruitment practice which puts the wrong person in the job followed with less than satisfactory performance management. Many managers have suffered inheriting the problem employee who has been passed from manager to manager without anyone confronting their performance or attitude. It’s usually the manager a long way down the line who is left with having to deal with the issue when the situation finally becomes untenable. Some cases indicate managers who have not been able to cope with the transition to a senior role and are unable to manage staff well.
Although some parts of the press make a huge song and dance about vexatious employees the experience of most HR departments is somewhat different. Most will confirm that there are usually only a very small percentage of vexatious litigants and even in these cases resolution might have been possible if steps had been taken earlier.
People really don’t want to take their employers to court, in my experience what most of them want is to be treated fairly, to know if their performance is not up to scratch and what they need to do to improve. In one organisation I worked in we managed to reduce the level of employment tribunals by over 80% in a relatively short period of time by talking to applicants and asking them what would resolve their complaint. In very few cases was money ever raised as a solution it was much more likely to be an apology, an explanation or understanding that was required. In most cases we were able to get the applicant to withdraw the case at no cost to the employer although this was dependent on the employer having the courage to admit when they were wrong and say sorry.
In the few cases where it is clear that an organisation is dealing with an unreasonable person who has not suffered any detriment by the employer the only response is to run the case, use the best lawyers possible, win and have costs applied to the employee, it seem harsh but is the only response to give a message that the organisation will not be taken for a ride.
The best solution of all is of course not to let a case develop till legal proceedings seem the only way out. Mediation conducted by someone from outside the organisation can be a cost effective way of resolving the issue as can putting in place the right training and development programmes for managers.
Most HR departments and managers will only have a limited experience of managing difficult cases and have to manage the employment relationship in the future. It’s on these occasions when the most practical solution is to bring in an experienced interim who has hands on experience and a track record of success in resolving such cases. Reputations are hard won and easily lost.
So don’t get too complacent about the change in the rules for tribunals, make sure your organisation can give the tribunals a wide berth and get on with running your business without distraction.