By Legal Futures Associate ARAG
The Employment Rights Bill unveiled by the government yesterday is incompatible with the employment tribunal system in its current state, the UK’s leading legal expenses insurance provider has warned.
ARAG, which protects millions of people and tens of thousands of small businesses against the costs of legal action, has published analysis of the latest tribunal figures released by His Majesty’s Courts and Tribunal Service (HMCTS) last week, showing that the significant problems in the employment tribunal system are getting worse.
The new bill will extend protection against unfair dismissal to employees from their first day of employment, removing the two-year qualifying period introduced in 2012 and giving millions more employees the right to submit claims for unfair dismissal.
Commenting on the tribunal system’s inability to cope with more claims, ARAG’s Claims Director, Chris Millward said:
“The employment tribunal system simply isn’t in a fit state to cope with any more claims. Backlogs have been growing for some time already, leaving both businesses and employees waiting years to resolve disputes.
The latest data show that the issues have gone from bad to worse. The number of claims is increasing but capacity to deal with them seems to be diminishing.
It’s hard to argue that access to justice in an employment tribunal is a right that should only be earned after two years of service, but such a significant change will inevitably result in thousands of additional claims.
The delays have a serious impact on both the workers involved and the businesses. It’s particularly difficult for SMEs, where such uncertainty can make bosses hesitant to invest in the business and discourage further recruitment.
If the government is serious about improving day-one employment rights it will have to fix the employment tribunal system first.”
Data published by HMCTS last week, for the first quarter between April and June, show that the open caseload of single claims was 18% higher than in the same period last year. The total number of single claims and lead cases in multiple claims was just under 44,000, also 18% higher than 2023.
But a monthly management information bulletin published by HMCTS yesterday showed a total ‘Employment Tribunal Open Caseload’ of 45,214 at the end of August, representing a year-on-year increase of more than 20%.
While the number of claims received has increased, the number of claims disposed of in the quarter to June was down 4% year-on-year. Disposals for the entire 2023/24 reporting year were 6% lower than for 2022/23.
Minutes published following a meeting of the Employment Tribunals National User Group, in April, revealed that longer hearings in the London South region were being listed for the first half of 2026, meaning waiting times of up to two years.
