For business owners defending a claim, it’s not uncommon for them to begin to feel it is drifting on while legal fees are escalating, and there is a sense that the case is controlling them, rather than them being in control of the case. I’ve handled dozens of Employment Tribunal cases and it shouldn’t be this stressful with the right lawyer on your side.
As a business owner where one of your employees has brought a claim such as an unfair dismissal, discrimination, whistle-blowing or breach of contract, you should ask your stakeholders three questions to determine if it is worth defending:
- Do you want to defend the case?
- Do you have any experience of dealing with Tribunals?
- Do you have capacity and budget to work on the case?
Can employers settle before Tribunal?
If you answered no to any of the above, it’s more than likely you should decide to settle (or instruct a lawyer to get the best result for you) instead of defending the case all the way to Tribunal.
If you do have capacity and budget, it’s important to also consider the time involved for your key stakeholders working with lawyers and employees as witnesses. Are you happy for your people to be doing this instead of focusing on running/growing your business?
If you would like to try to settle the case, your lawyers will need to be equipped with a good understanding of the case, the law involved, the strengths and weaknesses of the case.
To reach the lowest, quickest settlement (therefore saving the business cost and time), your lawyers should be sharp negotiators. They should understand and have experience of the psychology behind negotiation.
What are the chances of winning an Employment Tribunal?
When considering whether to defend the case or settle, you and your lawyers should assess the likelihood of you winning the case (as a percentage).
If you are likely to lose the case, your lawyers should be advising you to settle at an early stage, as losing will result in compensation (which is capped in discrimination cases) to the employee as well as legal fees for your business.
If you are likely to win, you must also be cautious that the outcome is never certain and allowances should be made for the unexpected. Witnesses crumble under cross-examination, and the other side could spring a new piece of evidence upon you, thus diminishing your chances of a successful outcome.
Your lawyers should be formulating a one- to two-page strategy document which should give you the high-level advice you need to reach the outcome you want, covering:
- How likely you are to win or lose?
- What the worst-case scenario is for your business?
- What the best case scenario is for your business?
- Next steps for you and your lawyers.
How much does it cost to defend an Employment Tribunal?
A straight-forward, unfair dismissal case may cost you £20,000 to defend. Even if you win the case, is that really a win for your business?
What happens if you lose a Tribunal?
If you decide to defend the claim and lose, there will be a financial loss to the business as you will be ordered to pay compensation. Employment Tribunals are also public forums, so whether or not you ultimately win the case, you need to consider whether potential media coverage is damaging to your business in terms of reputation, ability to recruit new hires and future growth.
To evaluate whether your Tribunal is worth defending, you should ask your stakeholders those initial questions, assess your chances of winning or losing, the business risk of defending the claim and what the ideal outcome would be for your business.