[Updated for 2017]
Since 29th July 2013 the fees an employee needs to pay to bring a claim are:
- Type A claims – unlawful deductions from pay and notice pay, refusal to allow time off, holiday pay and redundancy pay will cost £160 to lodge the claim and £230 for the hearing fee
- Type B claims – unfair dismissal and discrimination will cost £250 to lodge the claim and a £950 hearing fee
On announcement of the fee system, the largest UK union, UNISON, received permission for a Judicial Review of these fees, which was heard in October 2013 by the High Court. At this Review, UNISON argued that the fees contradict European Union laws and would make it virtually impossible for workers to exercise their legal rights. UNISON’s bid was backed by the Equality and Human Rights Commission.
On 7th February 2014, the High Court judges ruled that there was insufficient evidence to suggest the fees were unfair, so UNISON’s initial challenge failed.
The High Court said that the evidence presented by UNISON, based largely on how the fees might affect a set of notional claimants, had been too hypothetical to give a full picture of whether or not the fees were unfair. The Court said:
“It will be easier to judge actual examples of those who assert they have been or will be deterred by the level of fees imposed.”
The Court went onto say that the “fundamental flaw in these proceedings is that they are premature and that the evidence at this stage lacks that robustness necessary to overturn the regime.” The Court appeared to accept the union’s arguments that the impact of the fees barred access to justice for workers treated unfairly by their employers.
UNISON appealed this decision and in May 2014 they were granted further leave to appeal the High Courts decision and in September 2014 the Lord Chancellor gave UNISON the green light to launch a judicial review into the lawfulness of employment tribunal fees – due to statistics showing a sharp fall in Tribunal claims. These fresh proceedings were heard in October 2014 and a decision was announced on 17th December 2014.
Before Tribunal fees were introduced, an average of 48,000 new claims were lodged into the employment tribunal system every quarter. The figures for July – September 2014 show that in this period there were only 13,612 claims – 66% fewer than in the same period in 2013.
The High Court dismissed this second attempt at judicial review. UNISON have said they felt they had a better of chance of success the second time because it had built up evidence on how tribunal fees adversely impacted women, low-paid workers, disabled people and those from ethnic minorities.
The Judges in the High Court in December felt that there was limited case law relating to circumstances where the cost of litigation “had the effect of denying the claimant an effective remedy.” They also said:
“I would anticipate that if the statistics […] were drilled down to some individual cases, situations would be revealed that showed an ability on the part of some people to proceed before an employment tribunal through lack of funds which would not have been the case before the new regime was set in place. However, that assessment has to be seen as speculative until convincing evidence to that effect is uncovered.”
UNISON will appeal this decision of course, saying “The High Court’s decision is disappointing but we will fight on… to ensure that these punitive fees… are abolished”.
Many employment lawyers and other commentators have expressed their surprise at the decision, one saying the decision “seems surprising when it’s so obvious that access to justice has been severely reduced.”
Statistics have shown that “lower value” claims by individuals have been most affected – with claims for redundancy pay, maternity rights and ‘unauthorised’ deductions from pay badly hit. For example, if you have £100 deducted from your pay that is ‘unauthorised’ it would cost an employee £390 to take a case to an Employment Tribunal to recover the deduction (although if the employee wins the case the Tribunal is likely to order the employer to reimburse the employee the hearing fees as well). Therefore it appears that the present fee system has rendered the legal right to recover unauthorised deductions largely meaningless.
The appeal to the Court of Appeal was heard in June 2015 and at the end of August 2015 it was announced that the Court had again rejected Unison’s appeal. Unison have now sought permission to appeal to the Supreme Court, which was granted in February 2016 – we wait for the date of the hearing!
In June 2015 the new all-Conservative government announced their own review of the Tribunal Fee system. It will assess whether the fees are effective in, amongst other things, encouraging parties to look for alternative ways to resolve disputes, balanced against the maintaining access to justice. It will also look at the remission scheme. The review was published in early 2017 and found that although there had been a substantial reduction in claims, the governments objectives in imposing fees had been met (transferring a proportion of the costs to users; encouraging people to use alternative ways of resolving disputes; protecting the access to justice). The review also said there was no conclusive evidence that fees have prevented claims from being brought and rejected the 2 Parliamentary Committees that had said the level of fees should be substantially reduced. The Government will now consult on proposals to amend the fee remission scheme.
July 2015 – A Select Committee of MP’s has launched an inquiry into Employment Tribunal fees to assess whether or not their introduction has affected access to justice. They will look at the effects of the introduction of fees and the levels of those fees. The Select Committee will take evidence from external bodies such as tribunal users, which the Ministry review will not (and the Select Committee review will also cover other court fees changes). The latest data from the Ministry of Justice shows that the number of employment tribunal cases has declined by nearly two thirds since the fees were introduced. In early August 2015 the Law Society warned that the fees were impeding people’s access to justice; the Law Society will contribute to the Ministry of Justice’s review.
If you are an Employer and need ongoing professional help with any staff/freelance issues, or a Contractor/Freelancer/Employee with a complicated employment related problem, then talk to Lesley at The HR Kiosk – a Human Resources Consultancy for small businesses – our fees are low to reflect the pressures on small businesses and you can hire us for as much time as you need.
Please note that the advice given on this website and by our Advisors is guidance only and cannot be taken as an authoritative or current interpretation of the law. It can also not be seen as specific advice for individual cases. Please also note that there are differences in legislation in Northern Ireland.