Controversy over new employment tribunal fees

The UK government introduced fees for pursuing cases through employment tribunals in late July 2013. Employers’ organisations broadly support the move, but trade unions and employment lawyers have strongly opposed it, claiming that it will undermine rights conferred by EU law and that it will lead to indirect discrimination, particularly against women. In October, the new fees will be the subject of a judicial review hearing instigated by the trade union Unison.

Background

New fees for pursuing cases through employment tribunals and the Employment Appeal Tribunal (EAT) came into effect on 29 July 2013. Previously, it had been free of charge to bring a claim.

The government’s stated aim is to encourage mediation and the negotiated settlement of disputes rather than resorting to a tribunal hearing. The government has also said it believes it is ‘unfair on the taxpayer to foot the entire GBP 84 million bill [around €98.4 million as at 2 September 2013] for people who escalate workplace disputes to a tribunal’. The government says it wants people ‘where they can, to pay a fair contribution for the system they are using, which will encourage them to look for quicker, simpler and cheaper alternatives like mediation’.

The government announced its intention to introduce tribunal fees in 2011 (UK1112039I). A public consultation on specific proposals was held between December 2011 and March 2012 and the outcome was announced in July 2012 in the consultation document, Introducing fees in employment tribunals and Employment Appeal Tribunal. The Employment Tribunals and the Employment Appeal Tribunal Fees Order 2013 came into effect a year later.

The new fee structure

For employment tribunal cases, there are two fee levels based on the type of claim, reflecting the amount of resources required to deal with different claims. Simpler issues such as wage disputes and refusals to allow time off are classified ‘Type A’ claims, while discrimination, detriment and dismissal issues are ‘Type B’ claims, which are subject to higher fees, as set out below.

Table 1: Employment tribunal fee levels

Employment tribunal fees

Type A claims

Type B claims

Issue fee

GBP 160 (€187)

GBP 250 (€293)

Hearing fee

GBP 230 (€270)

GBP 950 (€1,113)

There is provision for the total or partial remission of fees for those on low incomes. Group claims are also catered for, with, for example, up to 10 claimants being charged no more than double the fee for one jointly-brought case.

At the Employment Appeal Tribunal, the fees are GBP 400 (€477.55) to lodge an appeal and GBP 1,200 (€1432.64) for a full hearing. Tribunals have the power to order the unsuccessful party to reimburse the fees paid by the successful party.

Social partners’ reactions polarised

The move has been broadly supported by employers’ organisations.

The Confederation of British Industry (CBI) has been pressing for the introduction of fees for some years, stating in a press release that ‘charging a fee to bring a tribunal case is a good way of weeding out more of the weak and vexatious claims’.

The Manufacturers’ Organisation (EEF) believes the change would ‘encourage more responsible behaviour by tribunal users’.

However, the move is strongly opposed by trade unions and many employment lawyers on the grounds that the fees would deny justice to workers who believe their statutory rights have been infringed by their employer.

Frances O’Grady, General Secretary of the Trades Union Congress (TUC), said that the introduction of fees represented

a great day for Britain’s worst bosses. By charging up-front fees for harassment and abuse claims, the government is making it easier for employers to get away with the most appalling behaviour. Its only achievement will be to price vulnerable people out of justice.

Judicial review of fees granted

The UK’s largest trade union, Unison, announced on 29 July 2013 that it had been granted a judicial review of the introduction of fees for employment tribunal and Employment Appeal Tribunal claims. The hearing will be held at the High Court in October.

Unison argues in a press release that ‘national courts must not make it virtually impossible, or excessively difficult, to exercise individual rights conferred by EU law’ and that the new fees are set at a ‘prohibitive’ level that will discourage litigation. Unison also argues that, because fees are not payable in other tribunals at the same level in the judicial hierarchy as employment tribunals, ‘it is a breach of the principle of equivalence to require significant fees to be paid to vindicate EU rights where no fees are required to vindicate similar rights derived from domestic law’.

Unison also believes that ‘there has been no proper assessment of the public sector equality duty’ or of the potential adverse effect of introducing fees on individuals with ‘protected characteristics’ (such as gender, claimed race, colour, national origin, national or ethnic descent, sexual orientation, civil status, birth, wealth, age, religion or belief, current or future state of health, disability or physical characteristics) and that the fees will result in indirect discrimination. Charging prohibitively high fees to pursue claims will have a disproportionate adverse impact on women, it said, arguing that ‘it is difficult to see how that impact could be said to be a proportionate means of achieving a legitimate aim’.

Mark Hall, IRRU, Warwick Business School

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