The Employment Law Blog

Supreme Court Rules Employment Tribunal Fees unlawful

Tribunal FeesIn a momentous ruling the Supreme Court have ruled that the Government’s policy of requiring Claimants to pay fees to bring a claim in the Employment Tribunal is unlawful. Tribunal fees were deemed unlawful because they prevent access to justice and because they are indirectly discriminatory, particularly against women who are more likely to work part time and are therefore disproportionately affect by the fees.

Fees were introduced nearly four years ago to the day by the Coalition Government in order to:

  • Transfer part of the cost burden from the taxpayer to the users of the Tribunal service; and
  • Reduce the number of weak or vexatious claims.

From July 2013 onwards Claimants have been required to pay a combined fee of up to £1,200, depending on the type of claim. This was argued by many to be outside the reach of most potential Claimants who by definition are likely to have just lost their jobs and therefore the fees regime came in for criticism as a barrier to Claimants seeking to enforce their employment rights.

Despite a fee remission system for Claimants with low household incomes and the ability of the Tribunal to make employers reimburse the fees to successful Claimants the number of Tribunal claims submitted since the introduction of Tribunal fees dropped by around 70% and the reason most frequently cited by potential Claimants for not taking their claim to an Employment Tribunal was this high upfront cost.

Whilst the Supreme Court found that the Tribunal system benefited wider society by deterring bad employment practice as well as those employees using the service it did not rule that the Government’s aims of transferring the cost onto the users of the system and deterring spurious litigation were invalid. The Court’s Judgment was however clear that the method the Government chose to pursue these aims was unlawful and discriminatory.

The Government responded immediately by confirming that fees would no longer be accepted for new Tribunal claims and that the £32million collected in fees over the last four years would be repaid. It is difficult to see how this will be done especially in cases which were settled and whether the Tribunal system even have a record of litigation which finished years ago.

We will have to wait to see if the Government make another attempt to introduce fees at a lower level but for now it is free again to access the Tribunal system.

Perhaps a bigger question is whether potential Claimants who could not afford to pay Tribunal fees now have a cause of action again despite being out of time to bring a claim. The Tribunal has the power to extend time limits in unfair dismissal cases if it was not reasonably practicable to bring a claim in time or where it is just and equitable to do so if the Claimant is alleging discrimination. I see no reason why potential Claimants in this situation could not issue a claim now for free using this Supreme Court decision to argue that the time limit to hear their claim should be extended because Tribunal fees prevented them from bringing a claim initially. This will not however be an option indefinitely as the Tribunal’s power to extend time limits on this basis is limited, potential Claimants will therefore lose the right make this argument if they do not act promptly.

There has been something of a predictable backlash against this ruling in some parts of the media who have suggested that this decision will lead to a flood of new claims but I genuinely think that employers who follow good employment law practice, have up to date HR procedures and employment contracts will have nothing to fear from a Tribunal system which once more allows access to justice for everyone.

If you would like advice as a result of this change in the law please contact us on 0114 218 4000 or email info@tayloremmet.co.uk.

 

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.