I have blogged previously on the proposed introduction by the Government of fees into the Employment Tribunal system.

The draft Employment Tribunals and the Employment Appeal Tribunal Fees Order 2013 (the "Order") introducing these fees was put before Parliament on 25 April 2013.

Fee Scheme

Under this legislation a fee will be payable in order to lodge a claim and a further fee will require to be paid to take the claim to a hearing.

The fees will be split into two "types" with more complicated claims attracting a higher fee. The Government announced on 13 July 2012 that the following fees would apply:-

  • type A - straightforward claims (e.g. unlawful deductions, notice pay and redundancy pay) will cost £160 to lodge the claim, with a further £230 hearing fee; and
  • type B - most other claims (e.g. unfair dismissal, discrimination and equal pay) will attract a £250 fee to lodge the claim and an additional £950 hearing fee.

The Ministry of Justice has also now published a stakeholder letter which explains the new rules and confirms that the above fees have not been changed in the Order. According to this letter the sanction for non-payment of issue fees and hearing fees are that the claim will not be allowed to commence or continue in the Tribunal. Further the Order, in relation to multiple claims, refers to paying the fee to avoid the claim being struck out, which suggests that strike out is the penalty for non-payment. However this has yet to be confirmed.

The Order also states the 'hearing fee' will fall due on a date set out in the Employment Tribunal's notification of the hearing date although it does not say specifically when that date will be. Previously it had been suggested that the fee would be due 4 to 6 weeks before the hearing which felt, to me, to be fairly late in the day. It will be interesting to see if this date is brought forward in practice.

The Government have also published an accompanying Q & A document stating that fees can be paid online. When lodging a claim by post the ET1 and cheque must both be sent to the designated Tribunal.

Possible Waiving/Reduction of Fees

On 18 April 2013 a consultation on the fee remissions system, in both the courts and tribunals, was launched with a view to introducing this system into the Employment Tribunal, to ensure access to justice is not reduced through the introduction of fees. The consultation closes on 16 May 2013. In the meantime Schedule 3 of the Order sets out the details of the proposed fee remissions system, which presumably may yet be amended in light of the responses to the consultation.

Under these proposals a Claimant will enjoy full remission where they are in receipt of the following "qualifying benefits":-

  • Income-related Employment and Support Allowance;
  • Income Support;
  • Income-based Job Seekers Allowance;
  • Working tax credit, provided that no child tax credit is being paid to the party; and
  • Guarantee credit under the State Pension Credit Act 2002(12).

Where the Claimant is not in receipt of any of the above qualifying benefits, whether they receive full or part remission of their fees will depend upon either their gross annual income or their monthly disposable income. If the Claimant's gross annual income does not exceed an amount specified in the Order, they will receive full remission of their fees. This threshold amount will depend upon the number of children (if any) that the Claimant has and whether they are single or not.

The Claimant will also be given a full fee remission where their monthly disposable income is £50 or less. There are then provisions for calculating a part remission of fees where the Claimant's monthly disposable income exceeds £50. The monthly disposable income is the monthly gross income with certain deductions, such as any child care costs or income tax either paid or payable in the month when the fee becomes due.

The income of the Claimant's partner is to be included as the income of the Claimant when considering whether a remission is due or not. However, the receipt by a partner of a qualifying benefit would not entitle the Claimant to remission of a fee.

In order to benefit from a full or part fee remission an application to the Lord Chancellor (although presumably he won't deal with them all himself!) must be made at the time the fee would otherwise be payable. Documentary evidence relevant to the basis upon which the Claimant is applying for the fee remission will be required.

The new Tribunal fee system is due to be introduced in Summer 2013 and it will be interesting to see how fee remissions are managed. One thing I am sure of though is that it will result in the number of claims lodged against employers reducing significantly.