Not everyone is aware that employers can be sued by employees during the course of their employment. It is not that common, of course, because if the relationship has broken down to such an extent, the employee will usually leave their job before bringing a claim, whether or not they claim constructive dismissal on doing so.
It can happen, however. Take, for example, an equal pay claim or some other form of discrimination where the employee perceives some kind of structural unfairness but there is no brokenness in their immediate working relationships, such as to make it intolerable to carry on.
It would also be possible, under the law as it stands, for an employee to sue their employer in the High Court or County Court for breach of contract while still employed, perhaps for a failure to make a contractually promised bonus payment or some other contractual benefit. Again, that is rare, not least because the courts charge hefty fees for starting claims and claimants are at risk of having to pay defendants’ legal costs if they lose. The Employment Tribunal, which has reverted to its long-standing position of charging no fees to users, relatively rarely awards costs against unsuccessful claimants and is rightly seen as a much more employee-friendly forum.
An employee can sue for breach of contract in the Employment Tribunal, but only after their employment has ended and only for up to £25,000. They also have to be quick about bringing claims in the Tribunal, where most time limits are 3 months. In the case of unfair dismissal claims, an extension will only be granted if it was not “reasonably practicable” for the claim to be presented on time – a high threshold.
At the end of last month, the Law Commission published a report recommending changes to the jurisdiction of Employment Tribunals. Although the recommendation which attracted the most media attention was the prospect that employees would be able to take their bosses to the Tribunal for being required to work excessive hours, that would in fact be quite a narrow extension to Tribunal powers, plugging a gap in relation to one particular right under the Working Time Regulations: the 48 hour working week. At present, an individual does not have the right to bring a complaint to the Tribunal if required to work more than 48 hours (without a valid opt out), and would either have to sue in the courts or leave it to the enforcement agencies.
The recommended changes that are likely to have a much wider impact are:
- Employees to be able to bring breach of contract claims up to a value of £100,000 to the Tribunal during employment;
- The time limit for bringing claims in the Tribunal to be extended to 6 months;
- The test for an extension to be relaxed to whether it would be “just and equitable”.
The first will be relevant to all higher paid employees with valuable benefits packages or whose notice entitlement exceeds £25,000. At present they would have to sue in the courts for any excess over that figure. The latter changes will affect record-keeping requirements across the board.
At this stage, these are only recommendations, but as the project was sponsored by the Ministry of Justice and the proposals will not require major structural changes to the system, we can be reasonably confident that they will be implemented by the government in due course.
Susan Kelly is a partner at Winckworth Sherwood
