Employment advisers will be interested in new research on the funding of cases in the Employment Tribunal. <a href=”#one”>(1)</a>
The research follows on from earlier research by the same authors into the impact of “no win, no fee” agreements in employment cases.<a href=”#two”>(2)</a>
The study is based on 63 interviews with claimants who had completed employment claims, and compares client perspectives on four methods of funding:
- Trade union funding
- Legal expenses insurance
- Damage-based contingency fees
- ‘Normal’ private payment (generally on an hourly rate basis).
The report’s main findings include
- Claimants appeared to be primarily motivated to claim because their own notions of justice were violated and/or because of encouragement by their family, peer groups and trade unions
- Very few chose their adviser in any informed or meaningful way or made a conscious choice between funding types
- Many solicitors failed in their professional obligation to inform and advise claimants of alternative methods of funding
- Most clients had only a very basic understanding of their fee arrangements but were generally satisfied with their fairness
- Clients were generally happy with any settlement advice received, and accepted such advice, generally without being pressured into settlement, but often without any genuine choice
- There were differences in settlement activity and advice by lawyers under different funding arrangements eg settlement activity was more frequent amongst trade union lawyers and those funded under legal expenses insurance
- Clients were usually satisfied with the service they received, although contingency fee claimants appeared less satisfied
- Regulatory agencies need to consider the implications of damage-based contingency fees for professional obligations.
The research does not consider the experience of claimants who received advice under the legal aid scheme (which covers advice and case preparation but not representation at tribunal), or free representation from not-for-profit agencies such as Law Centres or Citizens Advice Bureaux. NfP agencies should however be aware of the different funding models analysed here, so that they can advise their clients of their funding options. If, as is often claimed, free representation is less available than it used to be (for funding and other reasons), NfP agencies may wish to consider whether representation can and should be provided on some form of “no win, no fee” basis.
<a id=”one”>1</a> Something for nothing? Employment Tribunal claimants’ perspectives on legal funding, June 2009, Richard Moorhead and Rebecca Cumming, Cardiff University
Employment Tribunal claimants’ perspectives
<a id=”two”>2</a> Damage-Based Contingency Fees in Employment Cases – A Survey of Practitioners, 2008, Richard Moorhead and Rebecca Cumming, Cardiff University
A survey of Practitioners