Lies, damn lies and tribunal claims

It often seems that some claims are made up on the back of a fag packet. Sadly, there’s some truth in this assertion. Sarah Finley finds out what employers should do when confronted with false claims.

Take action about employment complaints
Employment tribunal costs warning
Employment tribunal evidence
Preparing for an employment tribunal
Probable outcomes of recent employment tribunal case
Employment tribunal facts and figures
Tips on handling a groundless employment tribunal case.

Handling a tribunal can be tricky for any employer. It can lead to a bad reputation, unnecessary costs, and cause stress for both parties involved. But what if the employer believes that the claims brought against it are false? Should it act differently to any other claim, or handle it in the same professional manner?

The recent Daleside Nursing Home v Mrs C Mathew case is seen as a landmark ruling where the tribunal judged in favour of the employer, saying the central allegation to be a ‘lie she deliberately fabricated’ to support a weak claim. The employer took the case to the Employment Appeals Tribunal (EAT), where it was awarded costs of £25,000.

This case was based on two claims: the first that the claimant was called “a black bitch” by her manager, and the second that she was under-paid. The tribunal threw out these allegations and settled in favour of Daleside Nursing home. But not every case turns out so favourably for the employer. Even if the employer believes a claim is false, this can be difficult to prove, and even harder to reclaim costs. So what can an employer do to ensure a positive outcome?

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Anthony Lloyd, an employment law director at manufacturers’ body EEF, believes that preparation is crucial. “If you have proper procedures and policies in place and trained personnel who are up to date with the law and know how to deal with claims, then this is a good start,” he says.

Sweeping complaints under the carpet, even if you believe them to be untrue, will further hinder your case. “Acting quickly and efficiently on claims which are brought to your attention will look better when it’s brought to a tribunal,” Lloyd says. “Take notes of meetings between you and the claimant and record all correspondence. The more time you spend on it, the better placed you are to defend yourself.”

Stephen Nettle, director at Beech Jones DE Lloyd, the solicitors involved in the Daleside case, says even though there is no way of preventing the commencement of a fraudulent claim, it is appropriate to write to the tribunal at the earliest possible stage to request that a preliminary hearing be fixed.

Employment tribunal costs warning

“The tribunal should be asked to consider striking out the claim as being misconceived or an abuse of process. Alternatively, if they are not prepared to strike out the claim, the tribunal can be requested to issue a warning to the claimant about the potential adverse costs and consequences which could follow if they are shown to have brought a false claim,” says Nettle.

Before a claim reaches a tribunal, employers can also refer it to conciliation service Acas, whose role is to find a solution that both sides find acceptable, and could prevent a case going to a tribunal hearing.

Both the employer and claimant have to agree to use Acas as a conciliator, then evidence from both sides is looked at to see whether a stronger case can be made, or if the claim is worth settling before it even reaches an employment tribunal. A claimant can decide to settle with Acas for many reasons, including the claimant realising that their case is not certain to succeed at a tribunal.

Employment tribunal evidence

If an agreement can’t be made, and a claim reaches a tribunal, it is the employer’s job to gather as much evidence as possible. But what evidence does a tribunal value?

There are two types of evidence – documentary and oral evidence. Each one is as important as the other,” says Lloyd. “However, unlike normal courts, not all evidence has to be based on fact.”

Conversation and hearsay can also be taken into consideration as long as the evidence is backed up by a witness.

Documentary evidence includes any sort of correspondence between the claimant and the employer, including e-mails and letters. Minutes of meetings should also be taken if an employee has already submitted the claim. This way, anything said can be set out in a clear and precise manner, and the employer will have evidence of this.

Contracts and performance reviews can also be used if relevant, especially when it may be in conjunction with a pay or dismissal claim. Other forms of documentary evidence include CCTV footage, but employers should be careful not to breach the human rights Act.

Preparing for an employment tribunal

Nettle believes that extensive preparation is required to enable the effective cross-examination of the claimant and their witnesses. “This includes obtaining very detailed statements from all potential witnesses (whether proprietors, employees or third parties) relating to the events in question and any relevant factual background, thus enabling the full factual matrix to be established,” he says.

In the Daleside case, Nettle sought statements from various people, including the former matron of the home, to confirm that the claimant had never raised any concerns with her about alleged under-paid wages. Various members of staff at the home, including two black employees, said the working environment was fine and that there was no discrimination. And a 90-year-old resident of the home, who as well as describing the atmosphere at the home in positive terms, indicated that her purported signature on a testimonial document produced by the claimant in evidence was a forgery.

Employers are allowed to call any witnesses they want. But it’s about quality, not quantity says Lloyd. There is no point having five different witnesses with the same story. One or two witnesses are fine, as long as they can provide the detailed evidence which can back up an employer’s argument.”

The Daleside case may be seen as monumental because of the compensation award given out to the employer, but is it a realistic outcome? According to figures from the Tribunal Service, only 0.3% of employers last year were compensated for costs incurred.

Probable outcomes of recent employment tribunal case

This ruling, however, could mean that employees might hesitate to make a claim, especially when they can’t substantiate it with relevant evidence. Linda Dickens, Warwick University’s industrial relations professor, believes this to be true, but also stresses that employers shouldn’t take this ruling as a sign that they will get compensated for a claim brought again them. The threat of cost awards may act to deter applicants, but awards of costs are rare and likely to remain so – most tribunal claims are not brought unreasonably,” she says.

“Employers would still be well advised to pay attention to how they handle employment matters before it ever gets to the stage of an employee contemplating going to an employment tribunal, rather than take comfort from the fact that there is a slightly increased chance that they will recoup any costs which might be incurred if that happens.”

And in the event of an employer being awarded costs, depending on the claimant, it may not be very likely that they will get them.

Matthew Welsh, a solicitor and partner at Fisher Jones Greenwood, says: “It is down to personal circumstances if a claimant pays out on not. It would be down to them to pay the sum and no-one else, so it would be dependent on many factors such as if they own property or they have a new job.”

Stephen Nettle, director, Beech Jones De Lloyd