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New financial penalties for employers who lose Employment Tribunal claims to be introduced from 6 April

The government published regulations on 11 February, confirming that, with effect from 6 April 2014, employers who lose Employment Tribunal claims will be ordered to pay a financial penalty.

Aggravating factors

The penalties will apply where the Employment Tribunal finds that the employer has breached one of the worker’s rights referred to in the claim and there has been “one or more aggravating features.”

The Employment Tribunal can impose a fine of between £100 and £5,000.  If it also makes a financial award to the successful claimant, the financial penalty imposed will be 50% of that award, up to a maximum of £5,000.

Employee grievance

It is not yet clear how the tribunal will identify an “aggravating feature”.  However, it could be that it would find “aggravating features” where an employer has failed to deal with an employee’s grievance or dismissed the employee in an obviously unfair manner.  Such conduct might also lead to compensation being increased by up to 25% anyway, as it would be in breach of the ACAS Code of Practice on Disciplinary and Grievance Procedures.

What this means for employers is that it is even more important to deal with grievances appropriately and to obtain legal advice on Employment Tribunal claims at an early stage.

For more information or to discuss how this might affect your business, contact David Leslie by calling 0113 368 7804 or by emailing dleslie@lyonsdavidson.co.uk

Posted on Feb 19th, 2014 by Lyons Davidson

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