There are few scenarios that are more frustrating for a business than dealing with an employee or former employee who has an inflated view of the value of his/her claim. Sometimes the employer knows it hasn’t covered itself in glory and is fully prepared to settle for an appropriate amount. In other cases, the claim has no merit – the business would prefer to settle on the basis that it will be more cost effective than fighting the claim, but not for the exorbitant sums demanded by the claimant. In either scenario, the individual often refuses to accept that, even if he/she wins the claim, the damages awarded will be far lower than he/she is demanding to settle.
Unfortunately, the Employment Tribunal process does not usually help to manage the individual’s expectations, leaving the employer with limited options:
a) Try to resolve the dispute through ACAS during the early conciliation phase.
b) Try to mediate the dispute either through the Employment Tribunal’s mediation service or through a private mediator.
Even if these avenues do result in a settlement (they often fail, especially at the early conciliation phase), the employer will typically have to, as a minimum, go to the time and expense of preparing a defence to the claim and attending a preliminary hearing. Often, settlement discussions do not become meaningful until after disclosure, which can be the most expensive aspect of the litigation.
What if there were a better way? We think there might be and it would work like this:
This procedure would enable the Employment Tribunal, at an early stage, to make clear to the individual what the realistic value of his/her claim is and give businesses the chance to settle claims at a realistic level if desired.
The individual would not be prejudiced – if the case is settled for what the judge considers is the maximum realistic value of the claim, he/she will have been fairly compensated and received that compensation more quickly compared to fighting the claim.
In some complex cases, in particular those involving disability where detailed medical evidence is required in relation to how long an employee will be unable to work, this process would not be suitable, but it should assist in the vast majority of cases.
Just a thought…