If you’ve been suffering a more severe bout of the January blues this week than usual it’s not hard to understand why. The news tells us that cost of commuting is an even greater percentage of workers’ incomes than ever before; the rail strike continues with no resolution in sight; fat cats having already earned more in a matter of days than the average worker will receive for the entire year, and, according to the Faculty of Dental Surgery, we should not even be consoling ourselves by enjoying cake and biscuits in the office, as they are fuelling an obesity crisis and poor oral health.

In the employment law world, the outlook for 2017 is one of considerable uncertainty. Worker status is an ever-growing issue with a number of Tribunal decisions awaited over the next few months. Gender pay reporting obligations are expected to come into force on 6 April 2017, with a number of questions about their application still unanswered.

Although Tribunal claims remain at a lower level than in the past, they are steadily creeping up again and tend to be more complex. Faster listing of hearings means a narrower window in which to achieve settlement before substantial preparation costs are incurred. The cuts in funding to legal advice clinics and the lack of legal aid are resulting in more claimants with limited means having access to either inadequate legal advice or none at all. With ACAS conciliators also over-stretched, dealing with early conciliation as little more than a tick-box exercise, this is making settlement of cases more difficult.

Unfortunately, our experience is that Employment Judges are generally reluctant to exercise their powers to strike out or make deposit orders and award costs in relation to weak claims. The recent EAT decision in H v Ishmail and Al-Megraby UKEAT/0021/16 further underlines the problem faced by employers in trying to stop unmeritorious claims progressing through the tribunal system. The Employment Tribunal had made a deposit order of £75 per claim to be paid by a claimant, on the basis that his claims had little reasonable prospects of success. On appeal, however, the Employment Appeal Tribunal reduced the deposit orders to only £1. Whilst a claimant’s financial means have to be taken into account in ordering a deposit, a £1 deposit order is never going to be an effective deterrent against pursing a claim. It may be speculated that some Employment Judges are partly motivated by a desire to redress the balance in response to what they see as the unfair imposition of Tribunal fees on claimants. If so, this is well-intentioned but unhelpful for those fair employers faced with misguided and sometimes downright vexatious litigation. In the meantime Unison’s challenge against the Tribunal fees regime continues and is due to be heard by the Court of Appeal at the end of March.

In the current climate, a key concern for many employers may well be how to retain and motivate staff where there is no budget for increased financial reward. HR teams coming under increasing pressure are necessarily adopting a fire-fighting approach. However, many of the individual employee issues we advise on have their roots in much deeper cultural and organisational problems. Employees dissatisfied with how they are valued and involved in the success of their organisation and unsettled by change, are more likely to take sick leave, raise grievances and perform less well. Unhappy, stressed managers tend to delay having difficult conversations with employees when they spot warning signs and then handle these badly. They also usually fail to inspire good performers to continue to succeed.

Admittedly, there are no easy solutions. However, those employers who commit to promoting transparency around decision-making and, who take on board feedback from staff about what motivates them, will have fewer employee relations issues to deal with. There are many simple no- or low-cost initiatives that can improve morale in the workplace, for example inviting staff to vote for colleague of the month or instituting dress down days or closing the office early as a reward for a successful project. Allowing staff to sacrifice salary in return for additional holidays and genuinely engaging with flexible working requests may also have a positive effect.

We may have a challenging year ahead of us but 2017 will undoubtedly offer opportunities for those brave enough to seize them.

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Louise Rea

Senior Associate

+44(0)20 7551 7799

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Posted on 06/01/2017 in Legal Updates

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