Resolution, settlement offers and the role of ACAS in the Tribunal claims process

Figures in the latest Survey of Employment Tribunal Applications (SETA) compiled and released by the Department for Business, Energy and Industrial Strategy (BEIS) give valuable insight into the outcomes from tribunal claims and the role of ACAS. If you are involved in such a claim or worry that you might be at some point in the future, these figures could inform your choices but it is also very important to ensure you have expert legal advice on how to proceed.

What is a settlement?

Settlement agreements are legally binding contracts which can be used to settle a dispute between an employer and an employer and are often used to end the employment relationship on agreed terms. Settlement agreements are voluntary, and parties do not have to agree them or enter into discussions about them if they do not wish to do so.

Settlement agreements can be proposed by both employers and employees, although they will normally be proposed by the employer. A settlement agreement proposal can be made at any stage of an employment relationship.

Settlement agreements are commonly made to settle a dispute to prevent a claim being made at the Employment Tribunal. The main feature of a settlement agreement is that they waive an individual’s right to make a claim to a court or Employment Tribunal on the matters that are specifically covered in the agreement.

Settlement statistics

A settlement was reached in 58% of all cases surveyed. In 17% of cases surveyed, an offer was made but no settlement was reached between the parties. In cases where an offer was made, it was mostly the employer (44%) or an employer representative (12%) who proposed the first offer. Financial reasons (46%) and saving time (26%) were the main reasons cited by employers. Among those employers who did not propose an offer, the main reason for not doing so was that they believed they had a strong case and would succeed at any tribunal hearing.

Claimants were most likely to settle because they thought it was less stressful than proceeding with the claim (40%). A third of claimants who withdrew their claims said cost was the reason, while nearly a quarter blamed stress.

What type of settlement offers are being made?

90% of cases that were settled consisted of a financial offer. In such cases, the median amount finally offered was £5,000. Almost nine out of ten employers complied with the agreed settlement in full.

The median amount actually offered in settled cases or where an offer was made (£5,000) was lower than the median amount claimants said they might have been prepared to settle for at the start of the case (£7,000), but was higher than the amount that the employer was initially prepared to pay (median of £3,000 where they were prepared to pay anything at all).

The role of ACAS

ACAS conciliators have a statutory duty to promote a settlement through conciliation. This can take place before the claim is submitted, as part of ACAS Early Conciliation, and/or after the claim process has formally started. The role of the ACAS conciliator is to discuss the issues of the case with parties, explain the Employment tribunal process, and statute and case law where appropriate. They provide both parties with information on the options available to them and pass information between the parties, including details of any offers of settlement. By encouraging claimants and employers to consider the strengths and weaknesses of their case, the conciliator seeks to narrow the gap between parties and bring them to a stage where a settlement can be negotiated.

Contact with ACAS

Eight out of every ten claimants said that they or their representative had personal contact with an ACAS officer after the application had been submitted; this included 62% who said they took part in conciliation at that stage. Three quarters of employers said that they or their representative had contact with an ACAS officer, including 54% who said they took part in conciliation at that stage. Levels of contact with ACAS after the claim were linked with use of ACAS Early Conciliation:

• Among claimants and employers who had taken part in ACAS Early Conciliation, in each case, two thirds also took part in conciliation with ACAS after the application was submitted

• Among those who did not agree to take part in ACAS Early Conciliation, nearly a quarter of claimants and 14% of employers took part in conciliation with ACAS after the application was submitted.

Claimants were more likely than employers to see ACAS involvement as important. In settled cases, almost half of claimants who had contact with an ACAS officer said it was unlikely that the case would have been settled without ACAS’ involvement, compared with 28% of employers.

Seven out of every ten claimants reported that they were satisfied in general with the service they had received from ACAS in their case. Satisfaction levels were the same among employers who had contact with an ACAS officer.