From May 2024, a new requirement for mandatory mediation will apply to County Court claims up to the value of £10,000. What does this mean for the recovery of unpaid recruitment fees? How can you get the most out of mediation?
If your client fails to pay an introduction fee, transfer fee, or fee for a temp supply which equates to less than £10,000, the usual route to secure payment will be to take a small claim in the County Court via money claim online. However, from 22nd May 2024 parties will now be required to attend a mediation appointment to try and resolve the dispute.
What is mediation?
In this instance, mediation is a less formal session designed to help both parties involved in a small claim dispute reach a resolution without escalating the situation to the County Court. This will involve an hour-long appointment conducted by telephone. It requires both parties to have a discussion with the aim of agreeing on a resolution. However, there is no requirement for a resolution to be reached, and the claimant will still have the opportunity to proceed to a hearing if needed. The hope is that this mandatory requirement will reduce the number of cases that proceed to a hearing, and it is usually in all parties interests to settle as early as possible. This also has the added benefit of clarifying the parties positions at an early stage of proceedings, accelerating the process.
Successful mediation
The success of mediation can depend upon being as clear as possible about your position and being able to present this in an effective manner. So, what can you do to ensure that you get the most out of the process and maximise the possibility of a favourable outcome?
Theresa Mimnagh, Director of Lawspeed said, “The key to mediation, or indeed avoiding court proceedings altogether, is knowing your case strengths, weaknesses, potential arguments and what you are willing to accept. An hour-long mediation appointment will not allow for detailed review of contracts nor legal argument. It should allow the parties to address key areas of dispute, provide clarification, if needed, and negotiate on settlement. Seeking early advice and gaining an understanding of your position can really help, and reduces time and cost.”
Best practice
Common reasons why fees are disputed include whether terms were agreed, whether a candidate was engaged and in what capacity, the level of fee being correct, whether a rebate is due, an introduction by a third party, or in supply cases whether the work has been performed satisfactorily. But a good contract will address these points, so provided you have had advice and mapped out these arguments pre mediation, it should allow for succinct push back.
Lawspeed provide robust contracts especially designed for the recruitment industry and succinct advice on the merits of a claim, including strengths and weaknesses. This will help you be well-prepared for mediation, enabling you to justify your claim effectively and understand what you could settle for. By doing this before making a claim, you may even be able to prevent a claim from being necessary at all.
For more information on mediation, fee disputes, or any recruitment or employment law matters, please contact us on 01273 236 236 or email us at info@lawspeed.com.
