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Employment Tribunal Fees Abolished

Laura Binnie

Laura Binnie, Associate Solicitor in our Employment law team, discusses the recent decision to abolish employment tribunal fees. 

In a landmark decision this week, the Supreme Court unanimously declared that employment tribunal fees – introduced by the government four years ago – are unlawful. Unison, the public services trade union, succeeded in their battle in arguing that the fees impede access to justice, having previously lost their case at the High Court and Court of Appeal. 

Watching the broadcast of the judgment via the Supreme Court video link, there was a high level of suspense surrounding the start of Lord Reed’s summary decision – and the conclusion was quite simply a historic moment for employment law regulation.

While it used to be free to bring employment tribunal claims, claimants have had to pay issue fees and hearing fees since July 2013, meaning that ‘basic’ claims (such as unlawful deduction from wages) cost a total of £390 and more complex claims (including unfair dismissal and discrimination) set individuals back £1200. There has been around a 70% drop in claims since the fees came in. Part of the argument (which succeeded in the Supreme Court) was that more women than men would have discrimination claims and the fees were therefore indirectly discriminatory. 

In addition, it was found that the government had acted outside of its powers in bringing in the Fees Order of 2013. The judgment mentioned that the purpose of employment tribunals was to provide an ‘easily accessible and inexpensive procedure’. While it was acknowledged that fees can be a justifiable way of making resources available for the justice system, the level of the fees cannot be such that access to justice is prevented. If fees cannot be reasonably afforded, for example by those on low to middle incomes who would have to sacrifice other reasonable expenditure in the process, the balance has not been struck. It was also pointed out that claims of low monetary value were effectively being rendered futile or irrational to bring, given the level of the fees.

What happens now?

Employers can surely expect to see an increase in claims now that the fee regime has been scrapped. In particular, the number of discrimination claims – where no qualifying period of service is required – are likely to rise. There is also the potential that former or disgruntled employees may raise claims, arguing that the fees prohibited them from doing so at the time and they should now be allowed to proceed. Whether the tribunal would exercise their discretion to allow such claims in out of time is a separate point and would need to be tested.  For those who have paid fees, they will have those payments refunded and again, we await details on how those individuals will receive their reimbursements from the government. In some cases, employers will have been ordered to pay the fees back to a successful claimant at the end of a hearing, in which case it is presumed that the company will receive the refund.

For more information, please contact a member of our Employment law team.

This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.