Employment Tribunal fees – where are we now?

Written on 4 Sep 2015

The long running saga about the legality of Employment Tribunal (ET) fees continues. Since July 2013, in order to pursue most claims in an ET, employees are required to pay an issue fee of £250 and a hearing fee of £950. Employees on low incomes may be entitled to a full or partial remission of these fees. In broad terms, since the fee regime was introduced, there has been a significant decline in the number of ET claims issued – the latest figures from the Department of Business Innovation and Skills suggesting claims have reduced by almost 70%.

Last week, the Court of Appeal (CA) dismissed Unison’s challenge that the introduction of ET fees was unlawful. UNISON had challenged the lawfulness of the fee regime by way of judicial review. Their arguments included that their introduction was a breach of EU law, denies justice to workers and has a discriminatory effect on protected groups. Each of these arguments were rejected. A key basis upon which the application that the fees breach EU law was dismissed related to the CA not being satisfied on the evidence that the introduction of fees had resulted in making it impossible for potential claimants to pursue claims – whilst a decline in ET cases led to a “strong suspicion” that individuals could not pay the fee, this in itself, was not enough. The CA required “evidence of the actual affordability of the fees in the financial circumstances of (typical) individuals.” It was not prepared to proceed on the basis that the “figures speak for themselves.”

Despite this decision, the position on fees in the longer term remains far from settled:

  • UNISON General Secretary, Dave Prentis called the decision a “huge disappointment and a major setback for people at work. Many unscrupulous employers will be rubbing their hands together in glee at the news”. He confirmed that they will be looking to take the case to the Supreme Court.
  • Separate to the CA decision, there are 2 reviews on-going into ET fees.
    • The Government have commenced a review of ET fees and the fee remission scheme generally. The review will consider: (i) ET data on volumes, progress and outcomes of cases; (ii) financial information, such as income received from fees and the costs of running the system of fee recovery and data on fee remissions; (iii) the general trend of ET cases before and after the introduction of fees; and (iv) the extent to which there has been a reduction in unmeritorious claims.  It is envisaged to report back by the end of 2015. The CA referred to this review in its judgment – “The decline in the number of claims in the Tribunals following the introduction of the Fees Order is sufficiently startling to merit a very full and careful analysis of its causes; and if there are good grounds for concluding that part of it is accounted for by claimants being realistically unable to afford to bring proceedings the level of fees and/or the remission criteria will need to be revisited.” However, outside bodies are unable to contribute to this review.
    • The second review is by the House of Commons Justice Select Committee and one of the areas they are looking at is whether the introduction of ET fees has affected access to justice. The closing date for submissions in this review is 30 September 2015.
  • Meanwhile, in Scotland, the Scottish Government have confirmed this week in their programme for 2015/2016 (see here) that they intend to abolish ET fees altogether stating “We will abolish fees for employment tribunals, when we are clear on how the transfer of powers and responsibilities will work“.

The next substantive development is likely to be the outcome of the Government’s review. Some see this as unlikely to result in any real change in the current system – it is after all a Government review into a change introduced by the Government (albeit at that stage in Coalition) in the first place; others see the review as potentially resulting in some sort of change – perhaps a reduction of the level of fees going forward (but certainly not an abolition). How matters play out in Scotland will also be interesting – will the likely abolition of fees in Scotland put pressure on the Government to take some proactive action on fees or will we simply have the prospect of a different ET fee regime operating in Scotland as opposed to England and Wales.