Under plans by the government to double the lower limit for recovering costs in minor injury cases, critics have warned that it could be discouraging to thousands of injured workers wishing to bring cases against their employers.
What is known as the small claims limit presently stands at £1,000 but the government intends to increase this to £2,000 - which personal injury experts consider could affect as many as 350,000 persons per year. The change is part of the government’s wider reforms programme for the civil justice claims system.
The Civil Liability Bill - designed to amend the claims process for whiplash injuries - was debated by MPs. The changes would be brought through via a statutory instrument rather than in the bill itself - and MPs were disapproving of the proposed new limits.
Richard Burgon - Labour MP for Leeds East - stated:
“We fear a fall in claims similar to 2013’s introduction of employment tribunal fees in personal injury cases, with genuine victims priced out of justice and deterred from pursuing a claim for an injury that was not their fault.”
Under the changes, employees who suffer injuries worth less than £2,000 will not be able to recover the cost from the persons they are suing, of any legal advice and according to unions and legal advisors, the probability of them succeeding in their cases will be weaker against employers who instruct lawyers.
However, Associate Director at Croner - Paul Holcroft - warning that the changes could encourage employees to represent themselves rather than hire a lawyer. He stated:
“This could result in an upsurge of claims against employers where individuals do not have specific legal advice at the outset to determine whether a claim is worth pursuing or not. Although the small claims track is viewed as simpler and more informal, an increase in litigants in person is likely to result in proceedings becoming lengthier and more onerous for employers, due to a lesser understanding of the court process. This will, in turn, cause employers to spend more on defending the personal injury claim.”
The Ministry of Justice gives the reason for the reform - which is due to come into force on April 2020 - as the fact that the £1,000 limit was set in the 1990s and needs to increase to keep pace with inflation.
A spokesperson from the Ministry of Justice said:
“Compensation in personal injury cases should be fair and proportionate, and making a claim should be as simple as possible. That is why we are making the system fairer for all – not least the taxpayer – and increasing the support available for claimants. The claims limit was last set in 1991, and our proposed increase for personal injury cases is in line with inflation.”
The Shadow Justice Minister – Gloria de Piero – stated:
“These changes mean more workers will be faced with a choice - either pay for legal help out of your own compensation, continue unrepresented and face large insurers who will continue to be able to afford lawyers or simply drop the claim. Disgracefully, the government won’t even be bringing these changes to the floor of the House of Commons where they would be fully scrutinised and debated by MPs. Instead, they’ll be using a statutory instrument; a legislative technique that allows ministers to alter existing regulations without having to have a full debate in the Commons. The Tories are trying to avoid the full scrutiny these changes desperately need.”
The Civil Liability Bill has now passed to committee stage but the implementation of the changes has been delayed whilst the courts service develops an online claims system.
