2024 reflections and 2025 forecasts
Employment Tribunal claims on the rise
Challenging economic conditions often result in a rise in employment disputes. Employers facing financial difficulties may look to make cuts to staff costs, such as redundancies and pay freezes. This can lead to increased polarisation between employers and employees and discontentment in the workplace, causing complaints to escalate.
At the same time, employees are faced with a competitive jobs market and heightened cost of living – while also being more aware of their rights. For those struggling to secure alternative employment, pursuing a claim for unfair dismissal, for example, may appear to be the better option.
It is therefore unsurprising that the number of claims in employment tribunals is heading ever upwards with total receipts in Q2 2024 up 13%. The number of open employment tribunal cases has also increased, by 18% in Q2 2024.
Underpinning these figures is a UK court system close to breaking point, with chronic delays and a burgeoning caseload. The current delays could prove even more acute as the number of claims continue to rise during the course of the year. Without significant investment in the court system, pressure on the courts will not be easing any time soon.
Increase in number of claims in employment tribunals Q2 2024
Increase in number of open employment tribunal cases Q2 2024
Non-competes gain popularity
In 2024, we saw more litigation arising around executive competition disputes than previous years, and we expect this trend to continue into 2025.
As organisations jostle for market share, employers become increasingly protective of their confidential information and their senior executives. As a result, companies are becoming more willing to threaten injunctions and to try to ensure that any departing employees are restricted from competing roles or from poaching clients or employees for as long as possible.
Sexual harassment – a focus on prevention
Sexual harassment claims and the #MeToo movement remain significant drivers of litigation, with high-profile allegations against the likes of Mohammed Al-Fayed and Gregg Wallace keeping these issues in the public consciousness. The new duty on employers to prevent sexual harassment in the workplace (which came into effect in October 2024) has also pushed the issue up the corporate agenda and raised awareness among employees.
Employers will be under growing pressure to take preventative action: assessing risk, implementing training and ensuring transparency of processes. Without these measures, employees may be more likely to pursue grievance procedures and disputes.
Not all claims are resulting in litigation, however: sexual harassment allegations alone can be so reputationally damaging that we may continue to see employers opting to carry out internal investigations and settle claims, rather than go to tribunal.
Neurodiversity and disability discrimination
Growing awareness of disability rights, including a more widespread understanding of mental health, has prompted a notable uptick in discrimination claims. According to the CIPD, mental health issues are now the biggest cause of long-term absence, which could in turn open the door to disputes.
Neurodiversity in particular has become more widely acknowledged, and with surging diagnoses amongst adults, and a younger generation more conscious of related conditions, employers could face more discrimination disputes.
Claims typically arise from a failure to make reasonable adjustments, but it is also possible for employers to face discrimination claims arising from a failure to consider disabilities in performance reviews and other processes.
"Growing awareness of disability rights, including a more widespread understanding of mental health, has prompted a notable uptick in discrimination claims."
Protected characteristics and beliefs
At the time of the last General Election, there had been some discussion about potential changes to protected characteristics, specifically, for ‘class’ to be included. However, this does not appear to be a current government priority, although it cannot be ruled out for the future.
Nevertheless, protected beliefs remain an issue hotly contested in the Courts. The Court of Appeal heard Higgs vs Farmor’s School in October 2024 on gender critical beliefs, and it is inevitable that we will see further similar cases arising.
Protected beliefs are a particularly challenging area for employers to navigate – this is an emotive area, making it much easier for mistakes to be made and for employees to feel aggrieved.
Whistleblowing
Last year, the Financial Times reported a 92% increase in the number of whistleblowing claims brought in the Employment Tribunal between 2015 and 2023. This trend suggests a cultural shift where employees are better informed about their rights, becoming more vocal about raising concerns and increasingly turning to the tribunal to challenge their employer’s actions instead of relying on internal procedures. Employees are also able to bring whistleblowing claims from day one of employment, in contrast to unfair dismissal claims which currently need two years’ service (although this is set to change under the Employment Rights Bill – more on which below).
Economic pressures and changes in workplace dynamics mean this trend is likely to continue in the coming year.
Last year, the Financial Times reported a 92% increase in the number of whistleblowing claims brought in the Employment Tribunal between 2015 and 2023.
Workplace tech: AI and surveillance
2024 saw employee surveillance come into the spotlight, with companies such as EY and PwC rolling out monitoring of UK employees’ office attendance, and Apple facing US lawsuits in employee surveillance cases.
As businesses push for a return to office, some are using surveillance methods to monitor compliance. While the consequences are yet to be seen in the number of in claims in the employment tribunals, it is very likely that related claims could rise in the year ahead.
There are also growing concerns over AI in the workplace, particularly with regards to recruitment. While the ICO has recently published guidance, employers will invariably be navigating uncharted territory, which increases concern among employees about their personal rights. These tensions could drive claims in due course.
Employment Rights Bill and day-one rights
The Employment Rights Bill has dominated the employment law agenda for 2024, and will continue to be a major consideration into 2025.
The Bill seeks to give more rights to vulnerable workers but it will be a while before it begins to take effect (changes are not anticipated to take effect until 2026), so any related litigation is unlikely over the next few years.
Once implemented though, we expect that the removal of the two-year service requirement to bring unfair dismissal claims, is likely to lead to an increase in unfair dismissal claims being brought.
In the meantime, with the Labour Government giving increased rights to trade unions, we could see unions bringing forward claims that previously they may not have felt they had the power to do so, with a particular focus on workforce issues around worker status and national minimum wage.
Employment Disputes
Our employment lawyers offer judgement-based practical solutions to employers and individuals, including senior executives. Resolving disputes in the workplace requires an in-depth understanding of an organisation, its needs and priorities, and the people involved. Our lawyers have the emotional intelligence, commercial understanding and legal expertise to guide you towards a practical resolution.