Fast Track Acas Settlements

26th April 2013

Fast Track Acas Settlements

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Over the years, we have dealt with Acas to settle employment tribunal claims on many occasions and generally our experience has been good. They provide a very useful service in helping Claimants and Respondent discuss the possibility of settlement without any comment on the merits of the case. Once a settlement has been reached in principle, Acas notify the tribunal that the claim has been settled and the tribunal then withdraw the case. This happens once the parties have agreed the wording of the settlement agreement but before the agreement itself is signed.

The settlement agreement is commonly called a COT3. The wording for the agreement is usually the responsibility of the Respondent in the case (typically, the employer) and the wording is pretty standard. We have a precedent that we have used and developed over the years and we generally don’t have much problem with the wording. Our standard precedent includes a clause that says that whatever settlement sum our client is offering is in full and final settlement of the claim brought in the tribunal and also any other types of claim that he or she might have against our client. This is a very standard wording.

So, you will imagine my surprise when an Acas officer called to say that we couldn’t use our standard wording to settle a wages claim, because this was a fast track case.  This meant they would only settle the claim brought in the tribunal and not any other claim he might bring against my client. This was a problem because the claimant was still within 3 months of the date he resigned and could, if he chose, bring other claims against our client, even if this particular claim had been settled.

I then started doing a bit of digging about what the fast track system means and whether you can change from fast track to ordinary track, if that makes sense. According to most internet searches for Acas and fast track, you find a lot of information about the fast track system for enforcing settlement agreements. I had the same problem when I looked through the text books and research tools we subscribe to. Again, I didn’t find anything about this fast track system. In fact, I found only one mention on the Acas site, without any explanation. So I spoke to Acas directly. According to them, this is an internal decision that they don’t publicise. It only relates to simple cases (usually wages cases) that will only take an hour or so of a judge’s time in tribunal, which was the case here. The internal decision meant that there could be no full and final settlement of anything and everything clause included in standard COT3s and while they were sympathetic to my client’s plight, they wouldn’t do anything about it. After a lot of pushing, I got an email explaining their position. It said:

“We have a  ” bible ” that we have to take guidance from and adhere to. I have gone through this with a fine tooth comb and extracted the paragraph below from it. I have also had another discussion with management re F & F settlement of all claims in Fast Track cases. Acas introduced this policy because of time scales. Meaning if the claimant decided to pursue other claims then it would take a lot longer to settle and close case. If you wish to pursue an all encompassing agreement then this would have to be done as a compromise agreement. Some respondents or respondents’ representatives may propose settlement wording which, in addition to settling the particular proceedings, also contains a clauses along the lines of: “the claimant warrants that s/he has no other claims against the respondent” (usually followed by a long list of jurisdictions). There is a difference in law between “all claims” wordings and those containing warranties. A “warranty” is merely an undertaking that the claimant believes there are no other claims they can bring against the respondent. It does not actually compromise any other such claims and would not necessarily prevent a further claim from being pursued. However, if the warranty is false and the claimant does bring a further claim, the respondent may be able to indemnify themselves against any award made or any costs incurred in defending the action.”

After some discussion with my client, we decided to go down the road of the warranty and indemnity clauses suggested by Acas, rather than the compromise agreement road. This was because the settlement sum was very small and we also didn’t want him to take advice from a solicitor. He hadn’t done so, so far and there wasn’t much time left in the three months for him to bring other claims. So, we now have a COT3 with the claimant warranting that he doesn’t have any other claims against our client and agreeing to indemnify them against any costs if he brings any other claim.

Not a particularly satisfactory outcome, as we may still find that he brings other claims. In every instance like this, we are going to have to consider whether Acas is in fact the right route to negotiate, or would we be better using a compromise agreement from the off. Is this really what Acas intended?


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