Law Commission Consults on Employment Law Hearing Structures

The Law Commission, the body tasked with reviewing our laws and recommending reforms, has launched a consultation on how employment law disputes are decided.

It has looked in particular at issues relating to the respective jurisdictions of employment tribunals and civil courts and has made a number of provisional recommendations for change on which it is seeking views.

What does the consultation include? 

The consultation contains 54 questions including:

Extending Time Limits

Should time limits for bringing employment tribunal claims be extended to six months and/or should employment tribunals have greater discretion to extend time limits?

Breach of contract claims

Currently an employment tribunal can only deal with a breach of contract claim which arises or is outstanding on termination. The Law Commission seeks view on whether employment tribunals should also be able to deal with disputes arising during employment or after employment has ended.  However, its provisional view is that tribunals should still not be able to deal with breach of contract claims relating to intellectual property rights, confidentiality obligations and post-termination restrictions.  It also considers that employment tribunals should not be able to hear claims originated by employers against employees. 
  
There is currently a cap of £25,000 on the amount of damages that an employment tribunal can award for breach of contract. The Law Commission proposes an increase in that limit and asks what the new limit should be and whether the same limit should apply to any counterclaim made by the employer.  

It is also considering whether the time limit for bringing a breach of contract claim in the employment tribunal should remain the same as for bringing an unfair dismissal claim (currently three months) or whether the civil courts’ time limit of six years should apply to claims brought in the employment tribunal.   

Jurisdiction of tribunals and courts to hear discrimination and equal pay claims 

The Law Commission proposes that employment tribunals should retain exclusive jurisdiction over most statutory employment claims.  However it is considering whether they should also be able to deal with non-employment discrimination claims (for example discrimination in education or the provision of goods and services).  Currently those claims have to be brought in the county court.  

At the moment equal pay claims can be brought in either the employment tribunal or the county court and the Law Commission considers that this should probably remain the case.  However it asks whether the time limits for bringing equal pay claims in the employment tribunals and courts should be the same.  Currently employees have six years to bring a claim in the county court compared to only three months in the employment tribunal. The Law Commission appears to favour extending the tribunal time limit to six years.  

Unauthorised deductions from wages claims

Here the Law Commission is considering whether employment tribunals should be able to hear unauthorised deductions claims which relate to unquantified sums, for example an unquantified discretionary bonus.  Currently those claims can only be brought as breach of contract claims and if brought in the employment tribunal can only be brought on termination and are subject to the £25,000 limit.  

Enforcement powers

At the moment employment tribunals have no power to enforce their own orders for the payment of money.  If an employer does not pay, the claimant has to register the decision in the country court.  The Law Commission is considering whether employment tribunals should be given this power so that they can enforce their own money judgments.

Responses to the Consultation on Employment Law Hearing Structures have to be given by 19 January. 

You can access the consultation paper and response form here.