LEGAL CORNER: Supreme Court finds that Employment Tribunal fees ‘restricted access to justice’

29th Sep 2017

This month the legal world has been digesting the Supreme Court’s decision that it was unlawful to charge fees to bring claims in the Employment Tribunal (R (on the application of UNISON) (Appellant) v Lord Chancellor (Respondent)) [2017] UKSC 51.

Employment tribunal fees were introduced on July 29, 2013; proponents of the scheme argued that it would transfer some of the costs of operating the tribunals from the taxpayer to those that use the service, encourage earlier settlement and discourage unmeritorious claims. Since then, parties have been required to pay a fee to issue their claim, followed by a further ‘hearing fee’ once the case is listed for a trial. For an unfair dismissal or discrimination claim, the fees were £250 to issue and £950 to have a hearing. The fees were fixed, and not related to the value of the claim. Although there was a remission system in place, this was not a simple process to navigate and stringent rules applied.

Following the introduction of fees, there was a sharp decline in the number of claims issued, in the region of 70%. Significantly, there was no significant change in the proportion of successful claims, suggesting that the fees had not been successful at weeding out the unmeritorious claims. As a result, Unison issued a legal challenge against the fees but was unsuccessful in both the High Court and the Court of Appeal. However, the Supreme Court overturned the earlier decisions, finding that the fee system restricted access to justice. Lord Reed, who gave the lead judgment of the Supreme Court, said that the fall in the number of claims since the introduction of fees had been “so sharp, so substantial, and so sustained as to warrant the conclusion that a significant number of people who would otherwise have brought claims have found the fees to be unaffordable”. This had happened “notwithstanding” the existence of the remission scheme, which was in any event “of very restricted scope”. Even in cases where the fees were not unaffordable, they could still be preventing access to justice by “render[ing] it futile or irrational to bring a claim”, for example where the monetary value of the claim was low.

In a separate judgment, Lady Hale considered the discrimination issues raised by the introduction of fees. She found that the higher fees payable for discrimination claims, in particular, had the potential to be indirectly discriminatory against women and other individuals with ‘protected characteristics’ under the Equality Act.

The judgment effectively means that anyone who has paid a fee since 2013 is entitled to a refund. This is not, however, a simple process, since in many cases, Tribunals have ordered that an unsuccessful Respondent should pay the successful Claimant’s fees. The Tribunal Service is currently working on the detailed arrangements of the scheme and hope to be able to publish details at some point this month.

The decision also leaves open the issue of those people who did not bring claims within the normal time limits, as a result of the fees issue. Whether they can seek to have their claims heard now, arguing that they could not afford to bring their claims in time, remains to be seen.

Finally, there remains the question of whether the Government will seek to introduce an alternative fee regime that takes on board the criticisms of the original system. In recent answers to Parliament, the Justice Minister Dominic Raab MP acknowledged that the Government had got the balance between the money paid by the tax payer and that paid by the user of the tribunal system wrong; he also apologised to those affected by the fee regime. He did not make reference to considering any alternative fee structure – which possibly suggests that one is not on the immediate horizon. It remains to be seen whether this Government has the time, or the inclination, to revisit this issue in the midst of its Brexit negotiations or not. In the mean time, potential claimants can bring their claims to the tribunal without having to pay any fees to have their cases heard.

Safia Tharoo

Barrister, 42 Bedford Row, London


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