Employment tribunals catch up

But why have they had to wait so long for judicial independence?

This is the fifth in a series of six posts analysing the government’s Judicial Review and Courts Bill. The final piece will be followed by a concluding essay for my paying subscribers.

Clauses 32 to 36 of the bill deal with employment tribunals and the Employment Appeal Tribunal. There is a curious story behind the government’s proposals.

Employment, pre-Covid. Photo by Alex Kotliarskyi on Unsplash

Industrial tribunals

Employment tribunals, known until 1998 as industrial tribunals, were created in 1964 to deal with appeals by employers against industrial training levies. They now have exclusive jurisdiction over more than 70 types of claim, including unfair dismissal, discrimination in employment, detriment of various specified types and redundancy. The claimant is almost always the employee or worker (former or current).

The Leggatt recommendations

Twenty years ago this month, the government published Sir Andrew Leggatt’s report, Tribunals for Users – One System, One Service. Leggatt was by then a retired appeal judge; his son George is now a justice of the Supreme Court.

The Leggatt inquiry found:

that the present collection of tribunals has grown up in an almost entirely haphazard way… The result is a collection of tribunals, mostly administered by departments, with wide variations of practice and approach and almost no coherence. The current arrangements seem to us to have been developed to meet the needs and conveniences of the departments and other bodies which run tribunals, rather than the needs of the user. 

As expected, Leggatt recommended that:

• There should be separation between the ministers and other authorities whose policies and decisions are tested by tribunals, and the minister who appoints and supports them.

• The administration of tribunals should become the responsibility of the lord chancellor. 

• The lord chancellor should assume responsibility for all appointments to tribunals

There had been attempts to persuade Leggatt that disputes between parties (such as an employer and an employee) should be treated differently from disputes between individuals and the state. In particular, the Department for Trade and Industry:

argued that the administrative control of the employment tribunals (and of the Employment Appeal Tribunal) should remain with the Department for Trade and Industry as the policy department, because it is best placed to decide what new legislation is needed in the light of its contact with both sides of industry.

Leggatt firmly disagreed. It was hard enough already to persuade claimants that employment tribunals were independent when there were around 1000 claims a year against the very government department that funded them and appointed most of their members.

Government says no

But the government was adamant. In 2004, the lord chancellor, Lord Falconer of Thornton, announced that:

responsibility for employment tribunal rules will remain with the secretary of state for trade and industry. This is because the secretary of state for trade and industry is not in general a participant in employment tribunal cases but does have the overarching policy responsibility for employment relations of which the employment tribunal system is a part.

When Leggatt’s recommendations were eventually implemented in the Tribunals, Courts and Enforcement Act 2007, employment tribunals and the Employment Appeal Tribunal were kept separate from the new First-tier tribunal and Upper Tribunal structure.

This what the government had said when introducing the legislation:

The employment tribunals and the Employment Appeal Tribunal are excluded because of the nature of the cases that come before them, which involve one party against another, unlike most other tribunals which hear appeals from citizens against decisions of the state.

That seems unconvincing. It was clear that ministers wanted to keep control of employment tribunals — though what they were worried about is hard to see.

The practical effect has been to make life much more difficult for employment judges. Even the most minor changes have to be approved by what is now the Department for Business, Energy and Industrial Strategy. As the department acknowledged nearly five years ago, “ageing IT systems and complex and bureaucratic processes are barriers to parties preparing and presenting their own cases”.

I found things were little better when I visited an employment tribunal shortly before the pandemic: although documents were filed online, they still had to be printed out before tribunal members could read them.

Government says yes

At the end of 2016, the government proposed reforms:

Procedural matters in all tribunals except for employment tribunals and the Employment Appeal Tribunal, and the civil and criminal courts, are the responsibility of statutory independent rule committees and/or the senior judiciary. We want to bring all the tribunals in line and therefore we will transfer the responsibility for procedural rules in employment tribunals and the Employment Appeal Tribunal to the independent Tribunal Procedure Committee. The senior president of tribunals will be responsible for determining panel composition. The Department for Business, Energy and Industrial Strategy will retain responsibility for employment law policy. The Ministry of Justice will be responsible for procedural policy in employment tribunals and the Employment Appeal Tribunal. This will ensure that the department responsible for funding and the operation of the system is responsible for business delivery.

And now, 20 years after Leggatt, we finally have a bill before parliament. Clauses 32 to 36, the government tells us, will:

• transfer responsibility for making employment tribunal regulations and Employment Appeal Tribunal rules from the business secretary and the lord chancellor to the Tribunal Procedure Committee, widening the rule-making powers to bring them into line with the First-tier Tribunal and Upper Tribunal;

• allow for the delegation of judicial functions in the employment tribunals and the appeal tribunal to authorised case officers on a similar basis to the First-tier Tribunal and Upper Tribunal; and make the lord chancellor responsible for deciding the composition of the employment tribunals and the appeal tribunal on the same basis as the lord chancellor does for the First-tier Tribunal and Upper Tribunal; and

• Transfer responsibility for paying employment judges’ salaries from the business secretary to the lord chancellor.

Paragraph 2 of the government’s explanatory notes says the bill provides for two additional members to be appointed to the Tribunal Procedure Committee: an employment judge to be appointed by the senior president of tribunals and an employment practitioner to be appointed by the lord chancellor. However, the government’s fact sheet says the employment judge is to be appointed by the lord chief justice rather than the senior president. That turns out to be correct: see paragraph 28(3) of schedule 5.

There is also yet another Henry VIII clause allowing the lord chancellor to amend, repeal or revoke any act of parliament, made in the past or the future, to facilitate making procedure rules.

Summing up the position, the explanatory notes say:

Employment tribunals are the only area of tribunal business where control over procedure rests with a government minister in another department. This contrasts with all other matters heard in the justice system where procedural rules are the responsibility of independent judicial-led committees or of the lord chief justice.

Although the policy intention is to make the arrangements between the employment tribunals and other tribunals more consistent, the government wishes to retain the existing distinct and separate structure of the employment tribunals and Employment Appeal Tribunal. The employment tribunals and the Employment Appeal Tribunal will therefore remain outside the unified tribunal structure and continue to retain separate rules (Employment Tribunal Procedure Rules) from the unified tribunal system (Tribunal Procedure Rules).

Any questions?

Here are two questions and answers from the government’s fact sheet:

This measure risks compounding the issues of a slow, overly legalistic system that doesn’t reflect the needs of business. How will the government ensure that the needs of the employment and business community are considered when rules are being created?

Ensuring that tribunal users, including the business community, can resolve their disputes quickly and effectively remains the primary aim of the employment tribunal and an essential rationale for this transfer… An appropriate representative from the employment sector would be appointed to sit on the [Tribunal Procedure Committee] so that the needs of the wider employment sector continue to be represented in the rule-making process…

With waiting times expected to exceed two years, how will this measure help to address the backlog in the employment tribunals?

Transferring rule-making powers to the Tribunal Procedure Committee will help the tribunal to respond more swiftly and flexibly to the challenges it faces through operational changes and rule-making… The transfer will also allow the judiciary to manage their workloads more flexibly, which is an important factor to help maximise the capacity of the employment tribunals…

That’s certainly an improvement. But all this and more could — indeed should — have been done 15 years ago.

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