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ACAS Early Conciliation

Next month marks the date of a substantial change in raising Employment claims. Now, anyone wishing to issue an Employment Tribunal claim must first contact the Advisory, Conciliation and Arbitration Service (ACAS) to consider conciliation of their potential claim. There is an initial transitional period between 6 April and 5 May 2014 whereby the service will be available to prospective claimants but it is not mandatory. It will be mandatory for claims presented on or after 6 May 2014. It means lodging last minute claims now becomes a lot harder!
If Claimants do not contact ACAS to consider conciliation their Tribunal claim will be rejected and could then be “out of time”. These are mandatory requirements which could have a signifcant impact on the claims process. 
How will it work?
Before a prospective Claimant can submit a claim form (ET1) to the Employment Tribunal they will be required to provide ACAS with prescribed information. ACAS will then provide the Claimant with an early conciliation number, which will need to be stated on the Claimant’s ET1 before it can be lodged. Information can be provided using an EC form or by telephone.
What information is required?
The form must include the name and contact details of both the prospective claimant and respondent. This is the only compulsory step in the process and there is no obligation on either party to actually engage in settlement discussions. Participation in the actual conciliation is entirely voluntary.
What happens next?
ACAS will make reasonable attempts to contact the prospective claimant. If contact is not made ACAS are likely to conclude that settlement has not been possible and issue the early conciliation certificate. If contact is made, then the conciliation offer will check that the claimant actually wants conciliation. If not, the certificate is issued.
The period for early conciliation is up to one month, from receipt of the form. This time period can be extended by up to two weeks, if it looks as if settlement may still be a possibility. The conciliation officer must endeavour to promote settlement during this time. If the parties have legal representation their representatives can conduct the conciliation.
If settlement is unsuccessful the conciliation period will be closed early and the early conciliation certificate issued. In cases which settlement is achieved within the period, the parties will enter into a COT3 or settlement agreement.
Stopping the clock
The certificate will be integral to the Claimant’s time limits for submitting a claim. Submission of the early conciliation form will “stop the clock” on the time period for a prospective claimant to submit their claim. Time will only start to run again one day after the early conciliation certificate is deemed to have been received.
This could lead to a situation where the Claimant puts in an early conciliation form just before the expiry of the normal time limit for bringing a claim as a tactic to buy more time. However, claimants will have to be very aware that the clock has indeed stopped, and that the procedure has started.
The new scheme is free and it is hoped that it will lead to successful resolution of disputes earlier than otherwise would have been the case saving time and money. Recent statistics have shown a 79% reduction in Tribunal claims in autumn 2013 compared to the same period in 2012 and this since the new Tribunal fee regime was introduced in July 2013. If this reduction is due to claimants being unwilling or unable to pay fees then claimants may be keen to engage with a scheme that promotes early settlement without them needing to incur an issue fee and/or a hearing fee. The fact that the pre-claim conciliation procedure is mandatory may serve to focus the parties earlier than usual on settlement or resolution as an alternative to litigation.
However it is only initiating the procedure that is mandatory, there is no duty to engage with it in good faith or otherwise so the extent to which this becomes a “rubber stamping” exercise remains to be seen. It is likely that entrenched parties with no appetite for settlement or conciliation will continue to bring or defend claims undeterred by these new measures.
Another potential implication of the extension of time limit provisions is that claims which do not settle are likely to take longer to be heard than before taking into account the later deadline for submitting the ET1 and the knock on effect this has on the date for lodging the ET3.
What is certain is that compulsory early conciliation will bring an added layer of complexity for claimants who have to be mindful of the usual time limits for bringing a claim but will also have to remember to lodge the ACAS form before the expiry of the usual deadline. This is likely to lead to more claims being submitted out of time and additional applications to extend time and jurisdictional challenges on out of time points from respondents. Rather than making litigation less likely, it may indeed encourage a new wave of hearings on time bar and strike out of claims.