The big issue of small claims
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25 March 2014
"The outcome of this case has more meaning to the plaintiff than a sum of money, because the defendants claim to have been entitled to dismiss her summarily because she is alleged to have smacked a child." The judge added: "What school is likely to employ her in the future in the light of that knowledge?"
This quote is taken from a recent judgment at Clerkenwell County Court. On this occasion, our employment law unit acted for the plaintiff who was granted legal aid to pursue a claim of wrongful dismissal. The financial claim exceeded the small claims limit when the proceedings were commenced but did not exceed the current limit of £3,000.
The case highlights two important issues about access to justice which should be of concern to the entire profession.
The Legal Aid Board recently issued guidance to its area offices on applications for legal aid in small claims. Legal aid, it states, is only likely to be granted where there are exceptional circumstances which justify the use of a solicitor. Further, even where exceptional circumstances exist the normal cost-benefit test for a grant of legal aid will apply. The Law Society, which was not consulted, considers the guidance unduly restrictive.
Had the case been brought now our client is unlikely to have been granted legal aid. Having lost her job and been prevented from earning a living as a result she could not have funded the case herself.
Industrial tribunals now have jurisdiction to hear claims for wrongful dismissal. Had our client been able to use the tribunal she would have faced a comparatively sophisticated and well-financed employer which may well have been represented; not surprisingly, represented employers have a far higher chance of defeating claims brought by applicants acting in person. And legal aid is not available for tribunal proceedings. In short, even if the option had been available to our client, it would have been far from appealing and quite possibly unproductive. Hardly a level playing field.
If the case was issued in the courts now it would almost certainly be dealt with as a small claim given the sum involved. No expert evidence was produced at the hearing and the case centred on one incident. Other litigators have confirmed that it would be difficult to persuade the court that such a claim is not suitable for a half-day arbitration hearing.
In the event, the court heard evidence over two full days and each party was represented by counsel. Important evidence which went to the heart of the matter was obtained by questioning under cross-examination, assisting our client to obtain judgment in her favour.
The small claims procedure is adequate in many cases but it is not appropriate for cases such as this. Losing one's livelihood without reason is one of the most devastating events that can happen.
The amount of money most employees are entitled to if wrongfully dismissed is low - notice pay and other contractual entitlements - and low-paid employees are particularly hard hit because their needs may be acute but their ability to obtain representation and a proper hearing severely limited.
Unless employees are protected by legislation, provision should be made to allow viable wrongful dismissal claims to be handled appropriately by the courts or industrial tribunals. Employees should be given the chance of a fair hearing and a judgment which could help them to secure employment.
It cannot be in the national interest for a section of the country's workforce to be deprived justice and the means of earning a decent living.