Employment Rights Act: Tribunal overhaul urgently needed
RSM UK says an overhaul of the tribunal system is urgently needed to tackle the increasing backlog of employee claims.
RSM’s recent Workforce Survey showed almost two thirds (65%) of employers think an increase in tribunal claims due to new unfair dismissal rules in the Employment Rights Act is either ‘somewhat likely’ (40%) or ‘very likely’ (25%). The survey also found one in ten (10%) of employers believe AI will exhaust HR and management by generating more grievances and complaints.
Recent data from the Courts and Tribunals Judiciary highlighted there are now 58,000 outstanding tribunal claims, up from 33,000 in Q4 2023/24. This represents a 76% rise.
Charlie Barnes, Head of Employment Legal Services at RSM UK said: “The current employment tribunal system is broken and needs an urgent overhaul. Increasing use of AI by employees - and litigation firms lodging claims on their behalf - is exacerbating the backlog and increasing costs for employers, both time and money. The tribunal system is creaking under a heavy caseload and a lack of judges. With cases taking up to four years to be heard, it’s impossible to see how the current system can provide swift access to justice, for either employee or employer, without additional resource or a complete overhaul.
“Since tribunal fees were abolished in 2017, claims have been rising steadily ever since, with a significant spike in the last year – and that’s even before the key elements of the Employment Rights Act kick in. While there has been some speculation fees may be reintroduced, this is unlikely for the foreseeable future, as fees are viewed as a barrier to justice.
“Some assistance may be provided by the Fair Work Agency, especially with its remit expanding to holiday pay from next year, but it won’t be the silver bullet. What may help stem the tide is higher costs for those who bring unreasonable or overly complex claims. With the Fair Work Agency soon able to recover its costs of enforcement from non-compliant employers, there’s a strong argument that those using AI to generate unreasonable, overly complex or unfounded claims should similarly contribute to the costs of doing so.”