Extension of the Employment Tribunal Claim Limitation Period
On 26th November 2024, the Labour government announced further amendments to their Employment Rights Bill which was originally published on 10th October 2024. Although amendments to the Bill are anticipated whilst it passes through various stages of the legislative process, what has been rather unexpected was their decision to increase the employment tribunal claim limitation period from three months to six months.
Current Law and Implications
The current employment tribunal claim limitation period for most employment-related claims is within three months (this is commonly interpreted as three months less one day). This limit has been in place for many years with the purpose to prevent claims being brought too long after the cause of action accrued and encourage resolution of workplace disputes in a timely manner between parties.
However, in more recent times, the three-month limit has been criticised by some for being too short. Particularly in instances where claimants issue a claim simply to protect their position due to the risk of limitation expiry, or where a party needs to seek legal advice or recover from emotional and/or financial stress following an alleged incident.
Who will be affected by the change?
It is important to note that the proposed new six-month employment tribunal claim limitation period will apply to all types of claims that can be brought before an employment tribunal. This includes claims surrounding discrimination, unfair dismissal, breach of contract and unlawful deductions from wages.
The positive impacts of the extension
The extension will help provide additional time for parties to appropriately consider resolving complaints through alternative avenues (such as informal grievance procedures) and may prevent additional expense of going through a lengthy and costly litigation process. It will also be most beneficial for employees who will be given more time to bring a claim against an employer, especially in instances where they may not know their legal position until sometime after an alleged incident.
The potential negatives impacts of the extension
The proposed extension to the employment tribunal claim limitation period will undoubtedly have a profound impact on the tribunal system. Government statistics show that in 2023/24, employment tribunal receipts and disposals have increased by 7% and 16% respectively (1) showing the tribunal being already in a position of an increasing number of claims being brought. The extension will likely amount to an increase in claims lodged, which will ultimately cause further strain and cause significant delays.
Implications for Employers
For employers, they could find themselves defending an increased number of claims due to the extension of the employment tribunal claim limitation period. This could be from former employees who may have left an employer, or concluded a formal grievance procedure, a significant time before a claim is brought. This runs the risk of having limited evidence available for an employer to defend a claim. This is particularly in instances where witness statement evidence is relied upon heavily and memories surrounding the alleged incident fade with time.
Not only this, but employers may also find themselves considering more frequently alternative methods to dealing with incidents. For example, utilising the option of settlement agreements at an earlier stage to avoid the costs of going through litigation.
Next steps for employers
Whilst the Employment Rights Bill is very much in its early stages of the legislative process, it is important that employers consider their working practices and how they should be changed in light of government proposals; particularly the extension to the employment tribunal claim limitation period. For example, an employer should review and update various policies to ensure they are compliant with employment law. They should also consider training senior members of staff to ensure that they are aware of the proposed changes and are able to appropriately deal with any complaints raised in a swift and compliant manner.
Next steps for employees
For employees, it is important to understand that whilst there is an increase in time in regard to the employment tribunal claim limitation period, it remains just as important to seek professional and legal advice as early as possible to ensure they understand the details of their claim and pave a route to resolution which is most beneficial to them.
If you feel you need to either bring or defend a claim at the employment tribunal, then contact GA Solicitors’ team of experienced employment law solicitors in Plymouth today to see how they can help. Call 01752 203500 or email me directly on robert.zacal@GAsolicitors.com.
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