Employment tribunal claims drop 25 per cent to hit seven-year low

The number of new employment tribunal claims fell to a seven-year low last year, according to statistics released last week by the Employment Tribunals Service.

The number of new employment tribunal claims fell to a seven-year low last year, according to statistics released last week by the Employment Tribunals Service.

With 86,181 applications registered, claims fell by a staggering 25 per cent from 2003-04, when 115,042 claims were brought. The number is the lowest since 1997-98, when new claims dipped to the 80,000 mark.

Unfair dismissal continues to be the reason that most applicants bring an employment claim, accounting for 39,727 claims or 46 per cent of the total. Unauthorised deduction of wages and breach of contract are the next most common reasons.

Claims brought for reasons of sex discrimination and disability discrimination fell. However, equal pay is becoming more of an issue, with the number of claims almost doubling between 2003-04 and 2004-05 to 8,229.

Following the introduction of new legislation, applications are beginning to dribble in for cases relating to discrimination on grounds of religion or belief and on grounds of sexual orientation. These accounted for 307 and 349 claims respectively last year.

The largest amount awarded in the employment tribunals was £179,026 for a discrimination case. Race discrimination claims attract the highest average award of £19,114.

Lovells partner Lisa Mayhew, who is defending Merrill Lynch against the record £7.5m claim brought by former banker Stephanie Villalba, said that the drop in cases could be due to potential claimants finding new disciplinary procedures too much of a hassle to bring a claim.

However, Norton Rose partner Pete Talibart disagreed. “On balance I think that the focus on internal dispute resolution is a very good thing,” he said.

Compensation awarded by tribunals
Nature of case Maximum award Median award Average award
Unfair dismissal £75,250 £3,476 £7,303
Race discrimination £170,953 £6,699 £19,114
Sex discrimination £179,026 £6,235 £14,158
Disability discrimination £148,681 £7,500 £17,736
 
Source: The Employment Tribunals Service Annual Report 2004-05

Applications/claims registered by employment tribunals
Nature of claim 2002-03 2003-04 2004-05
Unfair dismissal 46,534 46,370 39,727
Equal pay 5,053 4,412 8,229
Sex discrimination 11,001 17,722 11,726
Disability discrimination 5,310 5,655 4,942
Race discrimination 3,638 3,492 3,317
Discrimination on grounds of religion or belief 0 70 307
Discrimination on grounds 0 61 349
of sexual orientation
Total 98,617 115,042 86,181
Claims taken to the Employment Appeals Tribunal No data 2,084 1,876
 
Source: The Employment Tribunals Service Annual Report 2004-05