There is to be a new requirement for Early Conciliation for claims made in the Employment Tribunal. The conciliation process will be facilitated through ACAS, the Advisory Conciliation and Arbitration Service. The Regulations which set out the process for Early Conciliation have now been published and will come into operation on 6 April 2014.
The purpose of Early Conciliation is to reduce the number of claims which end up in an Employment Tribunal, therefore reducing the burden on many businesses. Parties can currently benefit from the assistance of ACAS in reaching early settlement through conciliation once claims have been lodged and are underway. However, under the new regime, there will be a new obligation on claimants to contact ACAS in relation to the prospect of conciliation before they will be permitted to bring claims in the Employment Tribunal.
Claimants will now be unable to lodge an ET1 and pay the relevant fees until they have received a Certificate Number from ACAS. The claimant will be required to submit an online form to ACAS or contact them via telephone and ACAS will have to respond within 24 hours to enquire as to whether the claimant would like ACAS to assist in the conciliation process. There is, however, no obligation to explain in any detail the facts and issues of the case.
There is also no obligation on the claimant to accept the offer of ACAS’ involvement in a conciliation process. If the claimant declines then ACAS will nevertheless issue a Certificate Number to allow them to continue with their claim.
If the claimant does want to try Early Conciliation then the three month time limit for submitting the claim will freeze for up to one month to allow for the conciliation process to take place. But, if the claimant does opt for the early conciliation option and the respondent refuses then the clock will start to run again when the claimant is informed of this and the claim will proceed as before. There is also a possibility of extending the period of early conciliation for up to 14 days if there is a reasonable prospect of reaching agreement. Whilst it is good to have this discretion and flexibility, it does seem that the matter of notifying the claimant of when the clock starts to run again and the length of any extensions may result in further administrative and hearing time involved in the Employment Tribunal where as arguments may arise over the correct deadline for making a claim.
The introduction of Early Conciliation could be a good thing for employers as in many cases, the first notification for employers of a claim against them will be when they are presented with the claim itself. By this point, the claimant will have paid the Tribunal Fees and so will be likely to be in the mindset for litigation and will be looking for substantial compensation, including reimbursement of those fees. It may be possible to use Early Conciliation as a way of avoiding this and settling claims for less.
However, some employers may be less inclined to take up the option of Early Conciliation and would rather take the chance of waiting to see whether a claimant actually submits a claim and is willing to pay the required fees to the Employment Tribunal in order to do so. If an employer does opt for Early Conciliation, they may see this as a route whereby they will ultimately have to pay out something to the claimant, whereas there would be a good chance if they held off that the claimant would drop their case rather than pay the fees.
It will be interesting to see what the effect of Early Conciliation will be on the number of Tribunal claims and also whether parties do opt to take it up in order to settle their case. If you have any questions or thoughts on the Early Conciliation Rules, don't hestitate to get in touch with Hannah or Hayley or leave a comment below.