REFORMS to the tribunal system that have led to a 70 per cent reduction in claims have been defended by justice secretary Chris Grayling.
Mr Grayling said the impact of the reforms was being monitored, but change was “necessary” to stop businesses from being threatened by “disaffected employees”
Lawyers and trade unions have criticised the July 2013 changes, which saw claimants at employment tribunals incur an upfront cost to the claimant of either £400 or £1,200, depending on the complexity of the case.
Mr Grayling said: “We were trying to deal with a situation where it was too easy to go to a tribunal and where employers, often good employers, were easy prey for questionable claims.
“For someone to go to a tribunal there should be some degree of hurdle for them to cross.”
Small business owners often chose to settle claims “even though they believe they are right” to avoids of defending a claim, Mr Grayling said.
Tribunal applications fell 75 per cent in the first quarter after the change. This rose to 79 per cent year-on-year. Applications between April and July 2014 were down 70 per cent on the same period last year.
Solicitors have suggested the sharp drop in claims means some valid disputes are not being heard.
Mr Grayling highlighted the fee remission system available to low earners, but stressed “there needs to be a degree of commitment” for people lodging claims.
“Otherwise a small business becomes very vulnerable to someone trying it on,” he said.
“The consequence of that is fewer people end up being employed.”
Speaking at an event at Beaumont Legal in Wakefield, the Conservative MP for Epsom and Ewell also urged the legal sector to innovate in order to bring down the costs of advice.
The industry should pursue new technology and buisness models to deliver services for the future, he said.
“Both the consumer and the public purse needs to secure legal services at a lower cost than they have in the past,” he said.
That requires out-of-the-box thinking, new business models and technology, he said.