Employment tribunal settlements

We are commonly and understandably often asked about funding of employment tribunal claims and possible settlements. At Darlingtons, we understand that, from an employee point of view, any kind of legal dispute is unwelcome and seldom do clients have a large amount of funds ready to invest in a case. Aside from this, with employment

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We are commonly and understandably often asked about funding of employment tribunal claims and possible settlements.

At Darlingtons, we understand that, from an employee point of view, any kind of legal dispute is unwelcome and seldom do clients have a large amount of funds ready to invest in a case. Aside from this, with employment law cases, as we explain later in this post, it is commonly simply not worth spending fortunes on legal fees due to the likely outcome of the case.

We receive many enquiries asking if we will take a case on on a no win no fee basis and again, we understand why the question is asked. Generally, we will potentially look at a case from that perspective but in reality we don’t offer many clients no win no fee. This is because employment tribunal cases can be very unpredictable and at the outset, with due respect to any client, we hear one side of a story which can be quite different from the full evidence available. Emotions run high in employment situations.

In addition, no win no fee arrangements, whilst appearing an attractive option for clients, do not always work out that way. In many tribunal cases which get anywhere near to a full tribunal hearing, legal costs on a no win no fee retainer can easily swallow up the entire amount of damages which might be awarded, therefore making the entire exercise a moral victory only for a client. Whilst many clients feel strongly about the way they have been treated by an employer, as with any civil dispute, it’s ultimately about money.

In reality, the most important thing to bear in mind is to be receptive to a settlement at an early stage, whether as employee or employer, before legal costs run up significantly, whether the case is funded privately or on a no win no fee basis.

Facts and figures may perhaps explain why I say the above. There is lots of data around relating to the number of Tribunal claims each year, but very little if any official Employment Tribunal  or other data on outcomes. We managed to find some interesting data from a University of Coventry study. Although the research is nearly 4 years old, it’s still relevant based on the Tribunal rules, damages and our own experience. Some interesting facts from the study, which sampled several thousand Employment Tribunal claimants :-

  • The average fee paid for advice to solicitors by claimants was just over £3,000.00 plus vat. Bearing in mind the majority of cases settle, it is reasonable to assume that if a case goes near to tribunal, the average figure would be likely to be more than double the average given above.
  • just over 30% of cases for unfair dismissal resulted in settlements of more than £5,000.00. In other words, more than 2/3rds of  unfair dismissal case settlements are less than £5,000.00.
  • of all cases in the sample, some 65% were settled
  • of all types of employment claims which settled, 45% involved settlements of over £5,000.00

As is apparent from the above, whilst every case is different and in some cases, particularly involving senior employees or unusual or overlapping issues or where the employer might face significant embarrassment, cases can settle for much higher amounts, the average tribunal case is worth less than £10,000 and many are worth less than £5,000.00.

Ben Jones – Partner & head of employment law

This post is intended to be informative, it is not intended to put anyone off from considering a Tribunal claim or from pursuing legal rights where they have been badly treated. If you feel you may have a claim and want good advice as to how to proceed and obtain the best resolution for your circumstances, I can help, so please contact me for further advice and information. You may also find these additional resources helpful :-

http://www.darlingtons.com/site/employment_law/

www.acas.org.uk/

Employment law • Uncategorized

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