Quest advises claims for unfair dismissal can cost highly

Quest, who provides BALI's HR & HS membership benefit, give their advice on unfair dismissal and the high costs involved. 

Employers may sometimes wonder what the financial risks would be of dismissing an employee unfairly, and where an employee alleges unfair dismissal, the potential claims would be:

• compensation
• reinstatement
• re-engagement

Compensation for unfair dismissal can include both a basic award and a compensatory award. The current maximum basic award is £15,240 and the compensatory award is capped up to a maximum of either £83,682 or 52 week's gross pay, whichever is the lower.

With discrimination claims, there are no upper limits on the amount of the award and an employee who wins on a discrimination claim may also be entitled to compensation for injury to feelings with 8% interest on any injury to feeling compensation awarded, calculated from the date of the harassment.

A dismissal is discriminatory if it is related to a protected characteristic that an employee has or is thought to have (perception discrimination) related to:

• sex, or marital or civil partner status
• colour, race, nationality or ethnic origin
• disability
• sexual orientation or gender reassignment
• religious or philosophical beliefs
• age

Also, for health safety and whistleblowing dismissals there is no upper limit for compensatory awards.

ANNUAL EMPLOYMENT TRIBUNAL STATS PUBLISHED

The Ministry of Justice have recently published their annual Employment Tribunal statistics for 2017/18 that provides some helpful indication of what level of awards have been awarded and in what categories together with the number of claims being made.

Since fees were abolished back in July 2017, the number of Employment claims have steadily increased with the number of single claims raising in the quarter of April to June 2018 by 165% from the same time last year.

In the year 1 April 2017 to 31 March 2018 a total of 109,685 Employment Tribunal applications were received; compared with 88,461 the previous year and 83,015 in 2015/16, therefore the expectation is that there will be a likelihood of further significant increases in Tribunal claims over the next few years unless fees are re-introduced in some other way by the Government.

With regards to Employment Tribunal financial awards, despite the increase in the number of claims the statistics reveal that Employment Tribunals only made awards in 536 unfair dismissal claims and 136 discrimination claims (compared with 587 and 158 the in previous year).

The highest average award was for claims for disability discrimination (£30,698) with religious discrimination at the other end of the scale at £5,074. The average award for unfair dismissal was £15,007.

The highest sum awarded in an Employment Tribunal claim in 2017/18 was £415,227 in an unfair dismissal claim (the usual statutory cap for unfair dismissal claims does not apply in certain circumstances). This was followed by £242,130 in a disability discrimination claim.

With an increase in claims, the Employment Tribunal has also seen an increase in claimants not being represented by a solicitor. The figures show that 74% of claimants were represented by a solicitor at the time of submitting their claim in 2017/18 which is down from 86% in 2016/17.

The Employment Tribunal statistics for 2017/18 give an interesting insight on Employment Tribunal claims and reflects the need for employers to take appropriate HR / Employment advice on potential dismissal matters.

Quest is able to offer advice and support all aspects of employment law, including advice on managing potential dismissals