Employment Rights Bill

Baroness Lawlor Excerpts

Committee stage
Wednesday 18th June 2025 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, Amendment 279GA would introduce a sunset clause to ensure that the extension of time limits for bringing employment tribunal claims is subject to periodic parliamentary oversight. I will speak also to Amendments 330ZA, 330D and 334A in my name.

I have tabled these amendments along with my noble friend Lord Sharpe of Epsom because I believe that the state of the employment tribunal system is deeply concerning and urgently requires our attention. The proposals before us introduce a range of new rights for workers, including the critical right to claim unfair dismissal from day one of employment. We must therefore confront the uncomfortable truth that the current tribunal system is simply not prepared to handle the additional burden that this Bill will place upon it. Indeed, we have heard from a respected law firm that there is broad consensus among legal professionals that the employment tribunal system is, in its words, the “biggest problem in the legal world”.

The Government’s own impact assessment suggests that tribunal cases will increase by around 15% as a result of these reforms, yet I must ask how this figure has been calculated. Given the scale of the backlog we are currently witnessing, can this be anything other than a gross underestimate? The reality is that, by extending the time limits within which individuals can bring claims, the Bill itself may actively incentivise an increase in the volume of cases. If people have more time to bring claims, it is only natural that more claims will be submitted—claims that must then be processed by a system that is already groaning under enormous pressure.

To put this in perspective, we are currently facing, we are told, an employment tribunal backlog of nearly 50,000 cases. This backlog has now reached record levels, with preliminary hearings being scheduled as far away as April 2026, and full hearings not likely to take place until well into 2027. This must be a crisis. A delay of this magnitude means that justice for many is effectively denied. When someone has to wait years for their case to be heard, the protection that the law is supposed to afford becomes little more than an empty promise.

The causes of this backlog are clear. There is an acute shortage of employment judges. There is insufficient funding. There is inadequate administrative support. Although the Government have pledged to recruit hundreds of new judges, the practicalities of ensuring that those judges have the necessary expertise and that adequate administrative support is in place remain significant challenges.

That is why I believe these amendments are vital. They do not seek to block or delay the introduction of important workers’ rights, but they instead insist on responsible, measured implementation. It is essential that before these new rights come into force an independent and thorough assessment is conducted to evaluate the capacity and effectiveness of the tribunal system. This assessment has to address current delays, judge numbers, funding and the likely impact of this Bill’s provisions on tribunal caseloads. Moreover, the Government must commit to implementing all necessary measures identified in this assessment to reduce the backlog to a manageable level, specifically to fewer than 10,000 outstanding claims. Only then should these rights be activated.

This is all about ensuring that, when workers exercise their rights, they have access to a tribunal system capable of delivering timely, fair justice. Additionally, the amendment regarding the extension of time limits for claims rightly insists that this measure cannot come into effect until the Senior President of Tribunals certifies that the system can handle the expected increase in cases without further lengthening hearing times. Without such a safeguard, we risk compounding the problem and turning an already overstretched system into something unworkable.

There is another important point that I must raise. Nowhere in the Government’s impact assessment is there any explanation of why the option of introducing a right to claim unfair dismissal between day one and two years was not considered. If the intention is truly to balance the employment relationship and provide fair protections, why do we have to leap to day one? This decision is not just a legal technicality; it carries real risks. One such risk is the disincentive it creates for employers to hire workers who may be perceived as risky or less secure in the labour market—such as individuals with a history of mental health challenges, younger workers or others on the margins of employment —by exposing employers to potential unfair dismissal claims from the very first day. This Bill may inadvertently make it even harder for these vulnerable groups to find work in the first place. This would be a tragic and unintended consequence, compounding insecurity rather than alleviating it.

We have debated at length the potentially vast powers of the new fair work agency, its funding and the role it might play. However, many questions remain. Will the fair work agency with its undefined enforcement officers and unclear operational framework genuinely take on the enforcement of workers’ rights in a way that meaningfully reduces the burden on the already overstretched employment tribunals? Or will tribunals continue to bear the brunt of this increased workload without adequate support or relief?

I now look to the Government to provide this House, workers, businesses, law firms, and no doubt the tribunals with some assurance, clarity and ideally a timeline for the day-one rights provisions in this Bill. Perhaps this is the moment when the Minister will at last share with us, at least in draft, the implementation plan that we have heard so much about during the course of this Committee. Will she please undertake to ensure that we have the implementation plan before we reach Report?

[Baroness Lawlor (Con)]

My Lords, I support Amendment 279GA for a sunset clause. I perfectly understand the reason for extending the period in which employees can make claims, but I am quite sure it will increase the burden on the tribunals. We have heard about the very long delay, with even preliminary hearings not scheduled until April 2026, and these delays have continued for some years. People going to tribunal sometimes have to wait more than 18 months just to have the preliminary hearing. If numbers increase, as they are likely to, as my noble friend suggested, it is going to put far more pressure on the tribunals. The parliamentary oversight proposed and the sunset clause must take account of that.

Not only is there no point in law in having a claim left unsettled for years, but it is very bad for business to have the uncertainty. It is very bad for employees and their lives to be subject to such delays and uncertainties in what is going to happen to them professionally, because taking a claim to tribunal is not an easy matter. It can be expensive and full of obstacles. Not knowing how it will pan out is very worrying for people. For businesses, being subject to constant pressures of claims in a tribunal, whether they are justified or not, brings insecurity and a lack of confidence.

For these reasons, I think this moderate request for a sunset clause and coming back to Parliament for an affirmative vote are a good proposal, and I hope the Government will listen kindly to it.

[Baroness Jones of Whitchurch (Lab)]

I thank the noble Lord, Lord Hunt, for introducing these amendments, but I say to him that the problem he has described so vividly was one we inherited from the previous Government. We are acutely aware that these issues need to be addressed, and I share his desire to ensure that the employment tribunal system can manage its existing caseload and the potential increase from the Bill’s measures. I assure your Lordships that we are working across government and with business and the unions to identify ways to improve a system that we inherited that is not working currently for anyone.

We are already recruiting more judges and legal case workers and providing additional resources to ACAS. On top of that, we are considering other things, such as the role that the expanded fair work agency could play in reducing the time spent awaiting costly and lengthy tribunal claims.

I would be delighted to receive any constructive suggestions from the noble Lords on this issue, but it would be entirely disproportionate to make the vital improvements to workers’ rights contained in the Bill dependent on the kind of review that their amendments propose. It would be wrong to take workers’ rights to challenge unfair practices away from them when they are not to blame for the backlog that we are currently grappling with.

--- Later in debate ---

The noble Lord is seeking to add a sunset clause to this measure, which, as he well knows, would undermine the policy intent. However, I reassure him that it is our intention that the implementation plan, whose arrival we all anticipate, will be made available shortly. I reassure your Lordships that the Government will closely monitor the impact of extending time limits on the employment tribunal system. We intend to conduct a post-implementation plan for the Bill within five years of implementation. This will provide enough time to assess the policy’s effectiveness and gather sufficient data for evaluation purposes, meaning that the amendment is unnecessary. I therefore ask the noble Lord, Lord Hunt, to withdraw Amendment 279GA.

[Baroness Lawlor (Con)]

The Minister made reference to the number of judges that the Government are busily recruiting so as to help the backlog, and this is part of the Government’s response. Of the 35,000 extra civil servants recruited since March 2024—these are the March 2025 figures—how many are judges, and how many of them will be in the employment tribunal service? I do not expect the Minister to have the figures to hand, but I would be pleased if she could write to me.

[Baroness Jones of Whitchurch (Lab)]

My Lords, 50 new fee-paid employment judges were appointed in 2024-25, and a further three recruitment exercises to further increase capacity are now being undertaken in 2025-26.