An employment tribunal does not have the jurisdiction to hear a claim if it has been subject to an agreement which complies with section 203 of the Employment Rights Act, or with a similar provision in another statute. It does have the power to determine whether an agreement properly complies with the terms of the section but it had not been clear if it could rule on the question of whether an agreement is void for some other reason, such as misrepresentation, or whether this would have to be decided by a court. In Industrious v Vincent, the Employment Appeal Tribunal conducted a comprehensive review of the case law and determined that it could, disapproving several of its own previous decisions, including Byrnell v British Telecommunications. Justice Silber notes that the judgment in Byrnell does not refer to the two most relevant authorities, one of which had been expressly approved by the Court of Appeal.

This result could have much wider significance because Byrnell had also been the only authority for the proposition that a tribunal cannot reject an agreement where there has been a repudiatory breach of contract, such as the fact that a settlement has not been paid. Indeed, it is difficult to see a distinction between a rescission of a contract because of misrepresentation and one resulting from a repudiation. It would therefore seem to follow that precisely such an argument would now be expected to succeed.

In Byrnell, Judge Ansell makes a brief reference to authorities, apparently relied upon by the tribunal, which state that a compromise agreement must be enforced by a court unless it was agreed before the termination of employment, because otherwise it would not fall within the scope of the Extension of Jurisdiction Order. This is correct but, in the above situation, the claimant is not seeking to enforce the agreement in order to obtain damages for breach of contract. She is seeking to set it aside so that she can bring a straightforward tribunal claim for, say, unfair dismissal. These cases are simply irrelevant.

The consequence of all this is that employers should now be particularly wary of failing to comply with the terms of compromise agreements as they may find themselves in the tribunal rather than merely facing enforcement proceedings. On the other hand, in contrast to settlements where a claim is stayed on agreed terms, a new claim must be issued and normal time limits will apply. Therefore, employees will need to keep an eye on the deadline if they want to retain the option to elect for the tribunal route.