A Basic Guide to Employment Tribunals for Small Businesses


Employment tribunals are something all businesses hope to avoid. But no matter how well you run your business, a dispute with an employee can still arise. You could even find yourself facing an employment tribunal.

If you do find yourself facing a tribunal, it is advisable you seek proper legal advice. Employment law is complex, and incredibly time consuming. The first thing you should do is understand how the tribunal system works.

We’ve put together a step-by-step guide for small businesses, who haven’t faced a tribunal before.

What is an employment tribunal?

Employment tribunals are an independent judicial body that hear claims about employment matters where there is a disagreement between employers and employees over employment rights. The most common disputes between employers and employees are:

  • Unfair dismissal
  • Wages and redundancy payments
  • Discrimination

Employment tribunals are less formal than a court, though like a court, they are open to the public, and evidence is given under oath.

Solving a dispute without a hearing

At some point there could be a complaint from someone who works for you. It could be to do with their work, who they work with, or about pay or conditions. It’s always best to try and resolve workplace disputes as early as possible.

Defer to your organisations grievance procedure and try to resolve the dispute internally. Grievances can often be settled quickly and informally if handled carefully. The Advisory, Conciliation and Arbitration Service (Acas) offer training and advice to businesses and about how to deal with disputes.

How to prevent a dispute reaching the tribunal stage

There are four main preventative measures SMEs should have in place if they want to avoid disputes getting to the tribunal stage.

  1. Develop a simple and effective grievance procedure. Employees should know what to do if a problem arises. You also need to have procedures in place so an issue can’t escalate without you knowing something about it.
  2. SME leaders should respond to disputes quickly, and seek to build an accurate picture of what has happened. Gather all evidence immediately in case it does end up going to a tribunal hearing.
  3. Instruct employees to keep workplace issues off of social media.
  4. Investigate with an open mind and seek to deal with the dispute fairly.

What happens during the tribunal hearing process?

If an employee has a grievance they feel hasn’t been properly addressed, they may make a claim to go to an employment tribunal. During the tribunal hearing process, the employee making the claim is referred to as the ‘claimant.’ Before lodging an Employment Tribunal claim, your employee must notify Acas first. This triggers a 5-step process:

  1. The Early Conciliation process

When an employee notifies Acas that they wish to make a claim for an employment tribunal, Acas will assign a caseworker and work with you and your employee to try and resolve the problem. This is known as conciliation and is an opportunity for you to prevent the complaint going to a hearing.

  1. The claimant submits the ET1 form

When the dispute hasn’t been resolved through the conciliatory process, your employee has to submit an ET1 claim form. This has to be submitted within a strict time period, typically three months from the date of the act they are complaining about. However, rules concerning time limits are complex, so it’s always best to seek professional legal advice.

  1. You receive a case management order and respond

Once the ET1 form has been filed, the tribunal will send you a letter and response pack (ET3). You may want to seek legal guidance, or refer to the advice given on the governments website, on responding to an employment claim tribunal letter. You are required to submit all relevant supporting evidence/documents. You must respond within 28 days.

  1. You receive notice of the hearing

At least 14 days prior to the hearing you will get a letter confirming the date, time and place of the hearing. You may be asked to go to a preliminary hearing, where the date and time of the actual hearing will be decided, and how long the hearing should take. You will also be advised if you are required to give evidence, or provide any additional information at the hearing.

  1. Arrange documents and organise witnesses

You can ask the claimant for documents that will help you with the case, and they can also request documents from you. These may include employment contracts, pay slips, or notes from meetings. The tribunal usually sets out a timetable for document exchange. You’ll also be told what documents you need to bring to the hearing.

You can bring witnesses to the hearing if they can give evidence that will help your case. If a witness refuses to attend you can ask the tribunal office to order them to come. You will have to pay the witness’s expenses for attending the tribunal.

During the whole process you can try to settle the dispute at any time by offering to pay compensation to the claimant. This is known as the settlement agreement.

At the hearing

At the hearing, (usually held at your local employment tribunal office), you, or your lawyer, will present your case, and the claimant, or their representative, will present their case against you. You may be asked questions by the judge, the claimant or their representative, or other tribunal members.

After the hearing

Sometimes you will find out the decision at the hearing, but in most cases, you will be sent a decision by letter in the post. If you win, you won’t be awarded compensation (unless the claimant acted unreasonably).

If you lose the case you may have to pay compensation and give the claimant back his or her job. You may also be liable for damages as a result of the claimant’s loss of earnings. If you disagree with the decision you have the right to appeal. You must submit your appeal in writing within 14 days of getting the decision.



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