Few employers expect to face a tribunal. For some, it’s a case of it-won’t-happen-to-me syndrome (optimism bias, as psychologists call it). But for most, a tribunal just never crosses their minds. And why would it?
They’re running their businesses as best they can. So what matters most is what’s happening now—ordering supplies, improving the product or service, and most definitely making sure the money keeps rolling in.
It’s this (quite understandable) laser focus on the day-to-day that leaves employers at risk. Not forgetting that the Supreme Court’s ruling that ended employment tribunal fees. The effect?
Within a year, claims have more than doubled, soaring by 130%. So for UK employers, it’s wise to drop the optimism bias and start thinking about how to avoid a tribunal. Which is good news for you reading this, because here are the four immediate areas you should address.
1. Start with staff contracts
Many claims stem from contract disputes, so think about how often you update them. Every year at best? As and when? Never?
While it’s yet another job for your list, regular reviews of your employment contracts are vital. Roles change, business objectives change, and laws change. Regular updates help to make sure your staff act in line with the agreed terms, but remember to consult with them first about any changes.
Perhaps you need to add new practices like mandatory overtime or an opt-out agreement to work beyond the 48-hour maximum weekly work limit. Such changes to match working practices reduce the chances of a claim.
2. Follow a fair disciplinary process
A disciplinary can be as unpleasant for employers as it is for staff. Aside from the toxic atmosphere that it can cause, the process itself is difficult and littered with pitfalls.
Remember that a ‘disciplinary process’ isn’t necessarily a fair disciplinary process. You must always follow the latter. Carry out proper investigations, make unbiased decisions, and don’t make mistakes.
Otherwise, you could quite easily face an unfair dismissal claim where the average payout for a loss is more than £15,000. And even when you have a valid reason to dismiss someone, remember that any flaw in your disciplinary process can make it an unfair dismissal.
3. The minimum wage trap
Knowing that you pay your people at least the right minimum wage is easy, right?
It’s there in black and white. Cold, hard figures on a payslip that prove you aren’t breaking any laws. Once again, it’s not that simple.
In fact, the Government found that during 2017/18, employers underpaid 200,000 workers a total of £15.6 million in National Minimum Wage (NMW) and National Living Wage (NLW) arrears.
The most common tribunal claim during the last quarter was for unauthorised wage deductions such as for covering the cost of uniforms or training.
Check now that your deductions don’t take staff wages below the respective minimum wage rate.
4. Be fair with your people
Treating your staff fairly sounds obvious. But there’s a major consequence of failing to do so: a discrimination claim.
It needn’t be overt discrimination, which tends to be the first kind of discrimination that comes to mind. That’s when you treat someone less favourably because of their race, sex and so on.
Indirect discrimination can happen if a practice or policy puts certain employees at a disadvantage. For example, say you have a policy banning headwear. How would that apply to a potential new employee who wears a hijab (a headscarf worn by Muslim women)?
Right there, your policy could lead to indirect discrimination on religious grounds.
Wrapping it up
Now, there’s nothing to stop employees from trying their luck by making a frivolous claim. There will always be people out there like that—it’s a risk that every employer faces.
But if you drop the optimism bias and follow these four pillars, you’re on the right path to proactive prevention against future employment tribunal claims.