Offered compensation by legal insurance - WWYD?

[NamechangedforET]

I would be very grateful for your thoughts on my situation. Will try to keep it brief - but it is complicated. Thank you in advance for any advice you may feel able to give. I don't have anyone irl to speak to so I appreciate this.

I have had insurance, including legal expenses, with Mark and Spencer for over a decade. Unfortunately in 2023 I had to raise an ET claim for disability discrimination against my employers. I applied to my insurers for legal expenses help. They confirmed that I may be eligible and, instructed [company name redacted] (solicitors) to consider the case. [company name redacted] sought an opinion from Counsel. Counsel was supportive of my case although I was not informed of this at the time. My case was seemingly then passed around [company name redacted] and the team it landed with seemingly carried out their own assessment of the merits, apparently unaware of the opinion received from Counsel, and determined that my claim did not meet the policy threshold. I was told that my claim did not qualify for legal cover. (Please note: for brevity I haven't provided all the detail but the company handled my case really badly - lots of passing me back and forwards and dropped the ball many times).

I paid for separate legal advice on the merits of the case. This like the advice [company name redacted] had received from Counsel was supportive and I proceeded with the case. I prepared the case myself and was a litigant in person. The case was due to be considered in July 2024 but unfortunately on the day the case was postponed as there wasn't a judge available. My employer has made representations to have the case put back to June 2025 (saying their barrister isn't available until then!!) and , despite my protests, the hearing has been scheduled for June/July 2025.

In the meantime my employer has offered a settlement- initially giving me 10 days to respond. I approached my insurers to see if I could get legal advice on the settlement (it is covered in the terms and conditions of the insurance). They again past me backwards and forwards between different departments in the team before finally agreeing they would assist but insisting that I had to get advice from [company name redacted] (rather than any other legal team). I was reluctant to do this given my previous experiences and raised a complaint.

During the complaint process (which took far longer than their published complain procedure timings) it became clear that [company name redacted] had received supportive advice from Counsel , that my case had a reasonable prospect of success , but claimed that this advice had been lost internally. My complaint was upheld and it was concluded that I should have received funding for my case.

The insurers have offered £300 by way of compensation. Their response erroneously assumes that my ET case has been settled and this is the end of it - the case hasn't been settled. My employer has offered a settlement but has not broken it down into its constituent parts so I have been unable to work out the tax implications ie I still don't know what the actual sums are that I would be paid and what would be deducted. Through ACAS I asked my employers for a breakdown - but , despite having over two months to do so, they haven't yet responded. The case is still scheduled to be heard in June/July 2025 if we don't reach a settlement.

So what I am asking for your views on? I suppose whether I should accept the £300 compensation or whether to pursue the case further with the Ombudsman? I also dont know whether I can ask for legal support with the ongoing ET case and settlement - but if so can the insurers continue to insist that I have to go with [company name redacted]? I really don't have any trust or confidence in them based on my previous experiences. WWYD?

I'm a solicitor. This is appalling. I would not accept £300. You had to go it alone instead of being represented. How much did you pay for your advice on merits? You need to be compensated for that loss as well as the inconvenience of representing yourself thus far. As for ongoing representation, yes, I would ask the insurer to provide it so you can get advice on the employer's offer to settle and/or representation at the final hearing. They must have other solicitors they use because of potential conflicts. Insist on using an alternative. Hold your ground and be persistent.

I am not a qualified lawyer but from a common sense perspective that compensation seems low given the appalling error you describe, that is [company name redacted]'s own solicitors 'deciding' not to take their own Counsel's advice (that is what it amounts to) so that you had to proceed without legal representation.
As far as the employer's offer is concerned, every case is different but in a case for unfair dismissal that I assisted a relative with, the first low offer (about a year before tribunal date) was rejected outright. Nearer the date of the scheduled tribunal slightly higher offers were made by the employer, again the earlier ones were rejected. About two weeks before the tribunal a more reasonable 'final' offer was made and although it was far less than the losses listed in the case documents it was accepted rather than go through the tribunal and risk the possibility of losing. That offer was just £X, it was never broken down into loss of earnings, holiday pay etc, but it was not taxed as far as I can recall. I do remember it being difficult to establish the tax position at the time.

£300 is a pittance ... I wouldn't accept it and would expect them to do tge work ongoing for ET or pay for it.

For information tge first £30k of a settlement is tax free.

Thank you very much for replying. I really appreciate it. As I am dealing with this on my own I find it hard to know if I am being reasonable or not so it's great to get opinions from other people.

In response to your questions - the advice on the merits of the case and help with the ET1 came to over £5000 (I have all the invoices and receipts). There was a lot of reading to do. I actually incurred costs double that as I got opinions from two different legal firms (after being rejected by my insurers I was nervous/wanted to be sure before investing a lot of time/money) but that was my own decision so I think I need to suck that up (ie incur one lot of legal costs myself). Regardless it was all so expensive that after the ET1 stage I had to act as a litigant in person which has been very stressful and dominated my life for over a year.

The tax issue is complicated as I am still employed by them (the offer isn't for me to leave just to settle my ET Claim) so I understand that the first 30k may not be tax free. I have been to HMRC (couldn't help) and legal advice clinics - they suggested that I ask my employers to specific any constituent elements that make up the overall settlement package , whether any particular element is to be paid either with or without deductions for tax and NI , and if deductions are to be made , wherever possible ask them to state the actual sums that are to be paid and deducted. ACAS asked on my behalf around two months ago but no response so far. They are a huge organisation so it shouldn't be impossible (obviously if they were smaller it would be a big/unreasonable ask).

I would seriously get the name of those specific solicitors removed from your OP for self preservation.

Also I'm sorry that you've had such a shitty experience with them. Mine was similar and that's why I urge caution in naming them.

So many things it’s hard to know where to start!

settlement amounts can be tax free up to £30k but it depends what they are including within it, so they do need to give you a breakdown.

the acas website has quite detailed advice on settlement agreements, so would be worth have another look there so you can be clear what your employer should be detailing. https://www.acas.org.uk/settlement-agreements

for any settlement agreement to be binding, you must have sought independent legal advice. Many employers will offer a specific sum towards this eg £250-£500, so worth asking if your employer if they will do this. If they agree to pay for this cost, then you could approach any legal advisor to review this initial agreement, and they can invoice your employer directly for payment of that specific fee. That wouldn’t prevent you from going back to the original solicitors if you decide to reject the offer and want to proceed with the claim, but if you are happy with the settlement amount then that side of things could be wrapped up?

the compensation offer from the mishandling of your claim is appalling, and definitely deserves a swift and firm response. If you have the energy to fight on that front, I would be pushing for a better offer from them.

whether you trust them to work on any ongoing ET matters, you’ll have to have a long think!

Thank you - I dont know how to do that? But just to assure you there isn't anything untrue/that can't be evidenced through the investigation report I received.

OP report your posts via the report button and ask that the name of the firm of solicitors is removed. They'll remove the name and your thread will still stand.

I'm absolutely not doubting you for a second (see my second post). I just have experience with them and urge caution. You can report your OP to MNHQ to remove the name from the post if you want to.

Thank you all very much. Have asked MNHQ to do this. It is a bit frustrating as they have been awful and just seem to get away with it.

It sounds like they've behaved appallingly. If you do decide to go to the ombudsman, I am cheering you on from the sidelines and hope they hold them accountable. The amount of positive PR they get is unbelievable given my experience was similar to yours only it ended with a threat if I ever contacted them again, despite the fact I never even complained, I just emailed once politely asking if someone could call me as things seemed to be getting mixed up in writing.

Thank you for all your replies.

The insurers have said they would pay £100 per hour to a solicitor. I have approached several companies but they all charge significantly more than that. I am reluctant to have to use the panel solicitors as they have made such a mess of my case so far but the amount being offered seems to make it impossible for me to appoint my own solicitor. I wondered if anyone else had been in a similar position and , if so, what you did? Thank you.

I Don know but I think you have a solid new law career if you want one!
Seriously it does sound awful. But I'd go with solicitor (upthread) advice. Definitely go back to the insurance, that's what you have paid for, their advice.

Hi, just to provide an update and thanks for your advice.

I did go to the Ombudsman who dealt with the case very quickly. The Insurers have agreed to pay for the legal costs I incurred when they should have represented me. They have also been told to pay £750 compensation for the year I had to represent myself (apparently they can't award much more). .

The insurers have also said that they will provide ongoing representation through their panel (I couldn't get anyone for the £100 per hour they proposed) - however unfortunately it is taking so long for the new solicitors to be appointed and consider the merits of the case that it looks like they will not be able to advise on the settlement offer in time, which is frustrating but not sure that I can do much more......

Hi, just wondering if there is an update? I am likely to need to take my employer (or former employer by end of month!) for unfair dismissal due to sham redundancy following discrimination. It all seems very long drawn out but on principle I feel like I need to take this further!