Well, the phoney war is over, and now we employment policy wonks can start sinking our teeth into some actual new policy, as opposed to mere proposals ‘under consultation’ or kites being flown in the media wind. Whilst the raft of reforms announced by Business Secretary Vince Cable on 23 November may not stack up to the ‘most radical shake-up in decades’, there is still a tasty range of separate initiatives for us pointy-headed types to feast on over the coming weeks and months.
But one radical reform that Cable didn’t announce – and should have – is a new, more effective mechanism for the enforcement of unpaid tribunal awards. This omission makes a mockery of almost everything else in his announcement.
In 2008, a Citizens Advice report, Justice denied, our third report on the issue in five years, suggested that one in 10 of all awards go unpaid. This prompted the Ministry of Justice to conduct its own research. And – much to the surprise of Ministry officials, who were clearly expecting their own research findings to undermine ours – this showed the true figure to be four in ten.
This shocking finding led the then Labour government to introduce, in April 2010, the so-called ‘Fast Track’ enforcement mechanism, under which – for a fee of £60 – an unpaid tribunal award (or Acas settlement) is passed to one of several firms of High Court Enforcement Officers (HCEOs) for direct enforcement. It wasn’t our first choice mechanism, by any means, but ministers told us there was simply ‘no money’ to do the job properly – and bringing in the HCEOs was virtually cost-free.
A hollow victory?
However, figures released to Citizens Advice by the Ministry of Justice in May 2011 show that, among the some 1,500 unpaid awards passed to the HCEOs during the ‘Fast Track’ mechanism’s first year of operation, the award was recovered in only 42.5% of completed cases. In the remaining 57.5% of cases, the unpaid award was deemed to be ‘unenforceable’ by the HCEOs, and no money was recovered for the supposedly successful tribunal claimant.
For these unlawfully-treated workers, the employment tribunal system, and the fast track enforcement mechanism, delivered empty justice.
Mind the gap
This matters greatly, not least because many of the reforms announced by Vince Cable, as well as the tribunal fees regime to be introduced by the Ministry of Justice, appear to assume full compliance with tribunal rulings by all respondent employers. For example, Ministers have sought to deflect criticism of the proposed application and hearing fees, of up to £250 and £1,000 respectively, by indicating that those with well-founded claims will not be deterred by the fees, because they will be able to recover the fees paid, along with the tribunal award, from the respondent employer.
But the 57.5% of respondent employers who are not paying tribunal awards now are clearly not going to repay hefty tribunal fees, either. Nor are they likely to pay Cable’s proposed ‘civil financial penalty’ for ‘those employers found [by a tribunal] to have breached an individual’s employment rights’. So it is not at all clear how, as ministers have claimed, such penalties will ‘encourage employers to have greater regard to what is required of them in law and, ultimately, lead to fewer workplace disputes and employment tribunal claims’.
So, whilst the tribunal fees regime will create an insurmountable barrier to justice for low-paid workers, Vince Cable’s department is busy abolishing witness expenses and tinkering with deposit orders, costs awards and other rules of procedure. The words ‘deckchair’ and ‘Titanic’ spring to mind.
Earlier this week, at a TUC conference on vulnerable workers, Vince Cable’s deputy, the employment relations minister, Ed Davey, sought to reassure delegates by proclaiming that he ‘did not enter politics to take important rights away from vulnerable people’. I’m sure he didn’t – Mr Davey gives every impression of being a thoroughly decent guy. But as TUC Deputy General Secretary, Frances O’Grady, said in her response: ‘rights on paper mean nothing at all if they are not effectively enforced’.
Messrs Cable and Davey need to think a bit more radically, and pronto, if they are not to go down in history as the thoroughly decent men who allowed the sun to set on the hard-won rights of many of the most vulnerable workers in the UK economy.
Author: Richard Dunstan
Richard Dunstan is a policy wonk who has worked for Citizens Advice, the National Audit Office, the Law Society, and Amnesty International UK.