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‘Unlawful’ Employment Tribunal fee system scrapped

‘Unlawful’ Employment Tribunal fee system scrapped

Employment Law expert Natalie Ruane reports on the Supreme Court's decision to scrap Employment Tribunal fees.

Fee System

In 2013, a new fee system was brought into place for claimants wishing to bring a claim in the Employment Tribunal.

The level of fee depended on the type of claim being brought, but saw claimants bringing unfair dismissal claims and discriminatory claims liable for fees of up to £1,200 in order to have their claim heard.

The fee system was introduced in order to prevent vexatious claimants from bringing claims and also to shift the burden of the cost of running the Tribunals from the taxpayers to those utilising the system.

A fee remission system enabled claimants on a low income to have their fees removed or reduced. If a claimant was successful at the Tribunal, their fees could be recovered from their employer.

Supreme Court Ruling

In July 2017, the Supreme Court held that the fee system was unlawful in R (on the application of UNISON) v Lord Chancellor [2017] IRLR 911 SC.

The Court held that without access to Tribunals, laws become ineffective. The benefit of such access was thought to be wider than just to that of the individual claimant, as judgments provide clarity regarding issues in the law and highlight remedies should breaches occur.

Further, the Court stated that the Lord Chancellor cannot impose fees which:

  • Create a real risk of a person being prevented from access to justice; or
  • Creates an intrusion greater than that which is justified by the objectives.

Since the fee system was introduced, there has been a drop of around 70% in claims accepted by the Tribunals. The Tribunals have also experienced a higher proportion of unsuccessful claims in the same period, highlighting that the fees are in fact deterring claimants with meritorious claims.

Further, fees have not encouraged early settlement of claims as employers have simply sat back and waited to see if the employee is able to ‘cough up’ the Tribunal fees in order to bring a claim.

Moving Forward

New Submissions

New claims submitted to the Employment Tribunal will not be subject to any fees.

Repayment Scheme

Claimants that have brought a claim through the Employment Tribunal will be eligible for a repayment of the Tribunal fees they incurred in bringing the claim. Equally, where an employer reimbursed a successful claimant for the Tribunal fees, the employer is eligible to recover this fee.

A refund scheme is currently being devised and an announcement expected shortly. This scheme is expected to cost the government £32 million.

Previous Claims Rejected or Not Brought

Claimants who previously did not bring a claim in the Employment Tribunal, or had their claim rejected as a direct result of being unable to pay the Tribunal fees, are now being advised to issue a claim form in the Tribunal.

It is likely that these claims will be outside of the time limit (i.e. 3 months for unfair dismissal), however the claim form should outline why the fees deterred the claimant bringing the claim within the time limit.

The Tribunal will decide on an individual basis whether a claim should be allowed to be brought outside of the time limit.

Future Fees

It is important to note that the Supreme Court held that the current fee system was unlawful. This does not mean that any fee for bringing a claim to the Tribunal will be unlawful.

There is potential for a new scheme to be developed and implemented which is more affordable, proportionate and will not deter meritorious claims. However, it is felt that due to the pressure on the government to deal with Brexit, that this will not be given attention at the current time.

If you are an employee or an employer who would like further advice relating to the removal of Employment Tribunal fees contact Natalie Ruane on 01768 800855 or nr@burnetts.co.uk.

About the author

Natalie Ruane profile photo

Natalie Ruane

Natalie is a Partner and leads the Employment Law & HR team and specialises in education.

Published: Monday 13th November 2017
Categorised: Commercial Client, Private Client, Employment, HR, Lawyers for Business, Legal Services in Newcastle, Penrith, Small Business / New Business, West Cumbria

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