Employment Tribunals Act 1996 (Tribunal Composition) Order 2012

Baroness Prosser Excerpts

Monday 19th March 2012 Grand Committee

[Baroness Prosser]

My Lords, I would like to make a couple of points. When moving the proposition, the Minister talked about the responses from employers welcoming the possibility of extending the period during which a person would be on trial, so to speak. That is not exactly surprising, is it? The point has been made around the Room—my noble friend Lord Monks described it as a free gift.

I am reminded of when employers were being asked for their views on the introduction of a national minimum wage. Their response was that its introduction would bring about the end of life as we know it and there would be no jobs made for anybody. In fact, the absolute opposite occurred. The fact that employers are claiming that this will be of great benefit and will encourage them to hire more workers seems to fall pretty far short of producing any real evidence in that regard. I cannot see for one moment that introducing this change will increase the opportunities for people to find employment.

Secondly, should this be introduced, women workers are likely to be hit harder than other employees, because, generally speaking, women change their jobs more frequently than men because of the pressures of other responsibilities. Can the Minister tell us if there has been any equality assessment of the impact of these proposals? Thirdly on the question of unfair dismissal, I would like to support the point made by my noble friend Baroness Donaghy. There would be much more to gain if there were more concentration on the need for management to be trained in how to manage.

The Chartered Management Institute assesses that only 13 per cent of people who are in management positions have ever had any training as managers, which is shameful. That would lead to difficulties when your employee is not up to scratch if after 12 months you could not say that they have had all the training they need. If the manager has had proper training, that matter can be dealt with in a way which is beneficial to the company, the manager and the employee. The cack-handed fashion in which a lot of these issues are dealt with is what leads to people going to the tribunal with a case that maybe is not as good as it might be, or people being dismissed for reasons which are completely and utterly unfair. Any manager who does not know whether an employee is good enough after 12 months needs to look in the mirror and ask who has the problem.

On the question of tribunals, I sat as a member of the Employment Appeal Tribunal for 11 years. When I worked in a law centre before I worked in the trade union movement, I represented people at employment tribunal level for six or so years. So I can speak with some experience of the value of lay members, and I can give two examples.

First, on many occasions, the judge has spoken to the applicant in such language that it is quite easy to tell that the applicant has not the vaguest idea what the judge is trying to tell him or her. So many times I have had to intervene and explain in words of one syllable what it is the person is being asked to do or to give further information on. Who will do that if there are no lay members on the bench? We will have people—who are not stupid by any means—but who are just not familiar with those kinds of phrases, that sort of language, those kinds of rules and regulations.

Secondly, on many occasions I had to explain to a judge whether a workplace situation that was being presented to the tribunal was something that was likely to happen, that was tolerable, or that would in the opinion of most people have led to certain dismissal or a very different outcome—because judges in tribunals do not have the experience of working on the shop floor or dealing day-to-day with people who work there. Not giving that information, advice and expertise to the judge, who no doubt has expertise of their own, would seem to be going down a path that is deeply unhelpful and could lead to decisions being made that are less than fair and less than accurate, and which do not take into consideration all the relevant issues. I hope that the Government will think again on these issues, but I will not hold my breath.

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Some noble Lords opposite will say that this will be very unpopular, but I think not. The real fury of people in the workplace is for those of their colleagues who they perceive as free riders—poor time-keeping, throwing sickies, work left undone, putting additional strain on the rest of the team. If through this procedure that sort of disaffection and those disagreements in the workforce are minimised, I think it is very important that we do this. We live in an age when some people, not many, are inclined to forget that employment is a contract—a two-way street of rights and responsibilities for both parties. If we are to encourage firms, particularly small firms, to take on more staff, they need the time necessary to establish a proper relationship of mutual trust and confidence.

[Baroness Prosser]

Is the noble Lord arguing that the best way to deal with “free riders”, as he described them—whom I don’t think anybody on either side of industry has time for—is through the extension of the period before protection comes along? Would he not agree that that is a really sensible argument for better management?

[Lord Hodgson of Astley Abbotts]

Clearly, it is an argument for good management. Identifying free riders is very important. Some people who promise quite a lot in the first few months are unable to sustain the work for various reasons. It is the performance appraisals cycle which sets deliverables and make it clear whether the person has delivered or whether the performance has, over time, drifted away and they have become a free rider. It is a sensitive interaction between what is practically laid down in the performance cycle and what management itself should be doing. There is no excuse for management not being prepared to grasp the nettle and make sure that any issue which clearly causes disaffection is tackled soon.

I turn to the employment tribunals order and the issue of whether a judge has the right to sit alone or can call for lay members. Based on my experience of the employment tribunals I have been involved with, the position has been that a judge has been able for the most part to undertake the work perfectly satisfactorily. I do not argue that this is always the case, but what does happen if you have three people sitting as opposed to one is that the time taken on the case is lengthened enormously.

Last year I was involved in a tragic case concerning an extremely talented man who had set up a small business in the video conferencing sector. I was not a director of the company but I had invested in it because I thought he was a rather talented bloke. Success had eluded him over a period of years and he had become increasingly irrational, and eventually the workforce of 10 to 15 people said to the directors, “It is either him or us. We cannot put up with him any longer”. The company had an internal conciliation process and I, along with another investor, was asked to sit down and talk to the chap. We did so, although it took four or five months to organise that. It was clear that he could accept no criticism of his performance because as soon as we said that, yes, the company had made some mistakes in the process but he was majorly at fault, he said, “Fine, I am going to an employment tribunal”.

It took a year to set up the tribunal, which had three people on it. There was really no dispute about the facts or anything else. This chap, for better or worse, very sadly could not accept that anything was wrong at all. A case that might have taken one or two days took six days, and it took three months for the judgment to be concluded. The result was, frankly, a tragedy. He lost his investment and eight or nine years of his life, during which he had spent all his time working on the business. I lost my small investment, which was a pity, but that was nothing compared with the 15 people who lost their jobs. One felt that the situation should have been capable of being grasped faster, and could have been dealt with more quickly, if it had been handled by one person, not three.

I would say to my noble friend that whereas the consultation document states that the objective is to,

“ensure that where parties do need to come to an employment tribunal, the process is as swift, user friendly and effective as possible”,

I know that there is no doubt that this case and many others that I hear about show that we are not as swift as we should be. If we are to have confidence in the system, we need swift justice because small businesses in particular find it extremely debilitating to have senior management devoted to preparing the case, sitting in on hearings, and in the mean time obviously having a disaffected employee.

I conclude by saying that I support the orders for the reasons I explained. They reflect my view of the changes that have taken place in recent years in both commercial and industrial practice, and they do so without weakening the safeguards we need to ensure that a proper equality of arms between employer and employee is maintained.