HMRC no longer reviewing Family Investment Companies
The Interim Report by Lord Justice Briggs which reached people’s desks early in the New Year fires the starting gun on fundamental changes to our Court and Employment Tribunal system. Those responsible for employment issues within their companies should be aware of the seismic change that is literally, around the corner.
First, some background. There have been many things wrong with our current regime. For example, we have been discussing for some time the effect of the introduction of Tribunal fees on the number of claims (in broad terms down, by what most people accept, is a somewhat unreal 75%).
Unusually employment cases are currently heard, not in one type of Court, but two. That is the Employment Tribunal and the High/County Court. Confusingly, some claims, such as for breach of contract after the end of the employment relationship, can be heard in either.
Court and Tribunal buildings are, in certain parts of the country, woefully underused. They are having to be “rationalised” (ie shut down) because they are uneconomic for a Government intent on cutting public expenditure.
And the biggest problem of all; the majority of potential users (and this can include SME employers as well as employees), are completely shut out of the system, because it is practically too expensive to use.
LJ Briggs has answers for all of this. His report concentrates on the current work of the High and County Courts and the Court of Appeal, but he also refers to the Employment Tribunals. His review will be finalised by July 2016, but he already lays out radical proposals which will assist in repairing the current regime.
For a start, we are going to see widespread “digitisation”. The Government has set aside £700 million to spend on this programme. Courts and Tribunals will no longer drown in paper. They are going to insist upon electronic communication only. In terms of case presentation in future, there will be a lot to learn.
Secondly, and dramatically, a solution for our Court Buildings. For some claims there are not going to be any! It is envisaged that claims worth below £25,000 are to be dealt with, entirely virtually via a new Online Court. Although Briggs does not specify, surely this is going to include employment claims. There is also the possibility (which is not really articulated in the paper) that it could herald a significant increase in the number of claims. The online application process may encourage those who at present cannot afford legal and other representation to initiate litigation. The power of the internet is articulated forcefully by Richard and Daniel Susskind in their book “The Future of the Professions” published last year. Information may become much more accessible to would be litigants, and those acting for Companies may find they are going to have to run faster than now, to keep up. Arguably then, the possibility of Court challenge may have to be (re)factored back into decision making, since fees cut such a swathe through the number of claims going to Tribunal.
Whilst Briggs says this is at the “edge” of his enquiry, he clearly supports the concept of a Single Employment Court. This was a proposal first mooted by the outgoing President of Employment Tribunals in England & Wales two years ago. Until recently many envisaged this would be part of the Tribunal. Briggs suggests there is much to be said for it to be brought over to the Courts. Soon, therefore, different procedural rules may apply to employment claims, and crucially, different costs rules may also apply. That may require new strategies and tactics for HR Directors to consider and adopt.
The big unknown in all of this, is the role of Acas. Since the introduction of Early Conciliation almost two years ago, the new system of having Claimants being forced to notify Acas if they wish to bring a claim, has been of considerable benefit to enlightened employers. They have used the process to head off claims before the Tribunal is engaged, or otherwise to learn more about claims they are about to face. But what is its future if, as we must now expect, employment cases leave the Tribunals for good, and become part of the Court process?
Whatever happens the world of employment litigation is not going to look the same. And the timescale for all of this? Just 4 years. HR Directors need to absorb what is to come, as it will very much affect the way in which they will handle employment cases in future.
This article was first published in People Management in January 2016.
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