Employment Tribunal Awards – Tackling Non-Payment

Employment Tribunal Awards – Tackling Non-Payment

The Government has said that it will look at measures to cut down on the non-payment of awards following a recent BIS sponsored survey which showed that over half of Claimants who were successful at Tribunal did not receive their award. Only 49% of Claimants who took part in the survey had received their granted award in full; 16% has been paid in part which leaves more than a third who had not received any money at all even after in some cases enforcement action was taken.
The Employment Relations Minister is considering several measures to tackle this issue including:
Fixed penalty notices for late payment
Ensuring claimants are aware of how to take enforcement action
Naming and shaming employers who fail to pay out
Changes to Employment Tribunal rules to give Judges the power to demand deposits from companies who they think may not pay.
The ‘Payment of Tribunal Awards 2013’ looked at whether awards were paid and where they were not paid the reasons for non-payment. The effect of enforcement action was also considered and it was found that in 37% of cases where there was non-payment the Respondent no longer existed had become insolvent or otherwise ceased trading. 29% of Claimants stated that their employer had refused to pay and 17% were unable to locate the Respondent.
Claimant’s with larger award values (over £5000.00) who did not receive their aware were more likely to report that the Respondent has become insolvent/ceased trading. It was found that almost half of those who were not paid their award pursued enforcement through the Courts (22% of all Claimants asked). The study showed a huge lack of awareness in relation to using enforcement to pursue an award. Only 41% of Claimants agreed that they were aware of the options open to them.
In light of the recent statistics the Government is also considering what action they should take to ensure that Claimants receive their awards where the Respondent has stopped trading. The Redundancy Payments Service can pay certain elements of a Tribunal award where a Respondent is insolvent but this does not cover all payments. The Government want to raise awareness of this service and ensure that rogue directors can no longer evade their responsibilities.
Whilst this study has obviously highlighted an issue with the payment of Tribunal Awards; this is not something that we have come across often in practice. Unfortunately this seems to be an example of solicitors closing files before clients receive their award and I personally think that this shows a failure on the part of the solicitors who are failing to advise their clients of their enforcement rights and options.
If you have been awarded compensation arising out of an Employment Tribunal claim and you are having difficulties with enforcing that award please do not hesitate to contact Michael Lewin’s specialist Employment Law Department for tailored advice in relation to your issue.
Written by
Crystal Bolton

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