Pictured: Michael Slade

The announcement by the Chancellor George Osborne that employees will have to pay a fee to instigate an employment tribunal - with the fee returned only if they win - is great news for businesses, Bibby Consulting & Support has said.

The employment law specialist described the £250 fee, with another £1,000 due when a hearing is listed, as "fair and reasonable" - particularly when compared with the very significant direct and opportunity costs of management time and effort in supporting a tribunal claim response.

Bibby Consulting & Support's Managing Director Michael Slade said: "We welcome the introduction of tribunal fees and are delighted with the charge rates. We believe that at this level they will go a long way to deterring employees from making unfounded claims. We also think the charges will encourage companies and their staff to work closer together to resolve any differences, and that can only be a good thing."

In the last 12 months there has been a 14 per cent increase in the number of tribunal cases brought by individual employees, with just 0.13 per cent of them having to pay anything. Indeed, 60 per cent of cases were settled by employers before they reached tribunal stage to help keep company costs down. 

Slade said: "We don't believe that introducing a tribunal fee would prevent those employees with a truly genuine case from seeking justice. But we do believe that a reasonable fee will discourage those who bring proceedings against a company without any merit.

"Most businesses will want to support employees if they have a real grievance but they will also welcome the ability to filter out some of the weaker claims and certainly those that have no substance at all."

Bibby Consulting & Support also believes that companies could be encouraged to recruit staff following the announcement by the Chancellor that from April next year employees (excluding those with discrimination based claims) will only be able to claim unfair dismissal if they have been in post for two years instead of one as at present.

In a survey of Bibby Consulting & Support's clients, a staggering 69 per cent said that extending the unfair dismissal qualifying period to two years would make them more likely to offer employment.

Slade said: "Rather than provide employees with less job security, the changes to dismissal rules will mean that workers should benefit from more support from their employers. They will also have a greater opportunity to prove themselves as valuable members of staff."