In July 2017, the UK’s highest court confirmed that the fees previously charged to employees wishing to bring tribunal claims in relation to treatment suffered at work were unlawful, following a challenge by one of the country’s largest trade unions.
Since 2013, most people wanting to pursue workplace disputes in relation to matters such as unfair dismissal, discrimination and non-payment of wages had been required to pay fees of up to £1,200 in order for their claim to be heard by a tribunal. The claims were split into two levels, with the apparently more simple claims attracting a lower fee and what were deemed more complex matters, including claims for discrimination, being subject to higher fees. The stated aims of the introduction of such fees included passing some of the cost of the tribunal system away from the taxpayer and towards the people making the claims and reducing the number of “nuisance” claims being brought by opportunist workers.
Reports suggested that the initial introduction of the employment tribunal fees contributed to around a 70-80% reduction in claims being brought, which was seen as concerning by unions and some politicians, although it is widely accepted that the introduction around the same time of the Acas early conciliation process has also been a contributing factor. The early conciliation procedure is still in place and requires all prospective claimants to contact Acas in advance of bringing a claim and engaging in a minimum period of conciliation aimed at resolving the dispute without the need for the parties even to get to the stage of a claim being brought.
Unison challenged the tribunal fee structure, arguing that it unlawfully restricted individuals’ legal right to access to justice and was also discriminatory against women on the basis that women were more likely to wish to bring the more expensive level of claim, including in relation to sex and maternity discrimination.
The Supreme Court has now confirmed its agreement with the union’s position and ruled that the fee structure was unlawful and discriminatory. The court identified a particular impact of the fees on poorer households who were found to be required to sacrifice other ordinary expenditure, such as buying new clothes, in order to afford the fees. In many cases, the fees were identified as the main reason that someone considering a claim would decide not to do so. It was also highlighted that the fees particularly stood in the way of people bringing claims for what would be considered low value claims or claims with no monetary value but which were still vitally important for the individual – often the fee itself can exceed the value of the money owed to the employee. Rather than discouraging claims with little or no merit, the fees tended actually only to reduce the number of low value claims, irrespective of the chances of success.
This is a significant decision both legally and politically, and one of the strongest examples of the UK court system being willing to limit the government’s powers to pass laws. As well as having a massive effect on tribunal process and the ability for members of the public to bring claims, this will also likely result in a significant hit on the court system’s coffers – especially given that it has been confirmed that fees already paid are to be reimbursed, estimated to amount to around £30 million. This bill will fall to the taxpayer to pick up. How the government makes arrangements for the prompt and accurate reimbursement of fees remains to be seen, particularly bearing in mind that where a claimant has been successful in their claim the employer may be ordered to reimburse the cost of the tribunal fees paid.
The Presidents of the Employment Tribunals initially stayed all claims and applications arising from the decision. However, that stay has now been lifted. We are now waiting for an announcement from the government as to how applications for reimbursement of fees or for reinstatement of claims rejected or dismissed for non-payment of fees are to be handled.
Although this is an important result for Unison and for employees’ rights generally, it may not result in a total removal of the tribunal fees regime. The government quickly confirmed that fees would immediately stop being charged and this was confirmed by the Tribunal service. However, it is possible that the Government may at some point in the future use the guidance provided by the court to set out proposals for a fairer, lawful fee structure which should be cheaper for the individual and significantly reduce the negative impact of the fees on claims being brought. That being said, recent comments at Prime Minister’s Questions suggested that there was currently no intention for the introduction of a “new and improved” fee regime, and it would likely be politically unwise for this Government to do so - at least in the short term. However things proceed, the ruling will undoubtedly result in an increase in claims being brought and therefore an additional burden on businesses in terms of defending such claims and the cost and time consequences that litigation inevitably brings.