The government has launched a consultation on the reintroduction of employment tribunal fees, nearly seven years after the Supreme Court ruled them unlawful.
Mike Freer, the minister for courts and legal services, said: “The Ministry of Justice has carefully considered the 2017 Supreme Court ruling on the previous approach to fees in the employment tribunals and has endeavoured to ensure that the fees proposed in this consultation are proportionate and affordable, in line with the judgment.”
The proposed fees are considerably less expensive than before, with a claimant paying £55 to issue any claim at the employment tribunal, and an appellant paying the same amount at the Employment Appeal Tribunal. Unlike the 2013-2017 tribunal fee regime, no hearing fee will be incurred under the government’s proposals.
The coalition government introduced employment tribunal fees in July 2013, categorising employment tribunal claims as Type A and B. Type A claims covered simple disputes such as unpaid holiday pay and attracted an “issue fee” of £160 and a “hearing fee” of £230. Type B claims were for more complex disputes such as discrimination, with an issue fee of £250 and a hearing fee of £950. The EAT attracted a £400 issue fee and a £1200 hearing fee.
Reintroduction of employment tribunal fees
Government could bring back tribunal fees
Where a claim is brought by multiple claimants, the fee would remain at £55 and the cost of the fee would be shared. A system for remission from fees would be introduced for people who genuinely cannot afford the fees, and a few specific employment tribunal claims will be exempt. The consultation closes on 25 March 2024.
Christina McAnea, general secretary of Unison, the union which took the government to the Supreme Court in 2017, said: “The fact that ministers want to reheat a failed and illegal policy shows that this is a government that ran out of ideas some time ago and needs to step aside.
“Tribunal fees denied the poorest and most vulnerable access to justice. The only people who would benefit from their reintroduction are unscrupulous bosses.
“When Unison forced the fees to be scrapped in 2017, the UK Supreme Court said the government had acted unlawfully and unconstitutionally. Nothing has changed. Tribunal fees were unfair then and they are still unfair today.”
Employment tribunal fees’ impact
TUC general secretary Paul Nowak said: “All working people should be able to enforce their rights. But introducing fees for tribunals puts yet another hurdle in the way of those seeking justice at their most vulnerable moment.
“The Tories have already tried this and failed. Last time they introduced tribunal fees, claims dropped by two-thirds. And the Supreme Court threw them out – saying they interfered with access to justice. Working people shouldn’t be picking up the bill for exploitative employers’ poor behaviour. Employment tribunal fees are just an invitation for bad bosses to ride roughshod over workers.”
The government has bent over backwards to keep the fee modest and it is unlikely to be vulnerable to another attack” – Daniel Barnett, barrister
The Supreme Court, which handed down its judgment on 26 July 2017, ruled unanimously that employment tribunal fees were unlawful. Seven judges accepted that the effect of employment tribunal fees had been a dramatic and persistent fall in the number of claims, particularly claims of lower value and claims without a financial remedy.
According to the judgment, employment tribunal fees were not reasonably affordable for households on low to middle incomes. Even where they may have been affordable, they prevented access to justice by making it financially ill-advised to pursue a case against an employer unless claimants were certain of winning and recovering their fees. After the Supreme Court ruling, employment tribunal claims increased by 39%.
Daniel Barnett, an employment barrister at Outer Temple Chambers, said: “On its face, this does not seem an unreasonable proposal or one that bars access to justice. The government has bent over backwards to keep the fee modest and it is unlikely to be vulnerable to another attack.”
He added that there is enough time to reintroduce tribunal fees before a general election and that it would not be “obvious” for a future Labour government to reverse the policy.
Paul Kelly, head of the employment team at Blacks Solicitors, said: “Understandably, this proposal has already been criticised by the unions; however, given that the proposed fee is much cheaper and the proposed structure far simpler than the fee regime of 2013-2017, could it be possible that the government has finally found a solution to this conundrum?
“So, if it comes to pass, will the new fee regime be a fairer system for all and help to clear the backlog of unmeritorious claims, or will it instead decimate the overall number of claims brought (both good and bad) as it did before? Only time will tell.”
The government outlined three key principles that underpin the proposed fees: affordability, proportionality and simplicity. The MoJ has assessed that a fee of £55 is generally affordable for claimants and appellants. The recently revised Help with Fees remission scheme used in other courts, means any person who is single, with no children and has less than £4,250 in disposable capital and a gross monthly income of £1,420 or less would be eligible for full remission of their tribunal or EAT fee.
The government also said that fees should be proportionate to the remedy being sought, to avoid people pursuing irrational and futile claims. Along with the issue of affordability, proportionality also formed part of the Supreme Court’s 2017 judgment where it noted that the previous fees were set at a level that could vastly exceed the value of the remedy sought by claimants in many cases.
Based on 2022-23 volumes the government estimates that the proposed fees could generate between £1.3 million and £1.7 million a year from 2025-26 onwards. The consultation suggests that the government intends to implement the fees from November 2024.
This article was originally published on 29 January and updated on 30 January 2024.
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