Employment Tribunal Fees held to be unlawful

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Employment Tribunal Fees held to be unlawful

Employment Tribunal Fees held to be unlawful

The Supreme Court has today handed down its decision on the long running case brought by the trade union UNISON against the introduction of employment tribunal fees in July 2013.

The Supreme Court has unanimously ruled that the government was acting unlawfully and unconstitutionally when it introduced these fees. Therefore fees for those bringing tribunal claims are unlawful. This ruling means that the government will have to repay up to an estimated £32 million to claimants who have paid fees to date.

Unison successfully argued that the introduction of Employment Tribunal fees meant that employees were prevented from being able to access justice and that it was indirectly discriminatory against women.

The judgement states that the fees are unlawful because it has the effect of preventing access to justice. “Since it had that effect as soon as it was made, it was therefore unlawful and must be quashed”. Fees were the most frequently cited reason for not submitting a claim.

Comparisons were made between the court fees payable for small claims, related to the value of the claim (where it is much cheaper to bring a claim for a small sum), and the fact that the Employment Tribunal and Employment Appeal Tribunal fees bear no relation to the amount sought and therefore act as a deterrent for claims for modest amounts or non-monetary remedies. These together form the majority of Employment Tribunal Claims. The introduction of fees coincided with a steep decline in the number of cases received by employment tribunals which has estimated to have reduced by up to 70% over the period.

The judgement held that fees were also indirectly discriminatory under the Equality Act 2010 because the higher fees for claims such as discrimination, put women at a particular disadvantage, because a higher proportion of women bring discrimination claims.

What next?

Employees will no longer have to pay to take their employers to court.

This does mean that employers are more likely to see an increase in Employment Tribunal claims as there will be no fee deterrent (at least in the short term until the government considers its options) for employees to lodge a speculative claim - even if it is entirely unmerited. Fees were introduced to prevent these types of claims but also for the Ministry of Justice to save money – however the introduced fees regime was found to have gone too far.

Our employment team have an enviable track record of successfully representing employers. This includes striking out claims early (so they can no longer be pursued) or gaining deposit orders (where a claimant has to pay up to £1,000 in order to continue their claim) against claimants whose cases have no reasonable prospects of success at early stages of proceedings.

When faced with the reality of an employment tribunal claim you need focussed, effective and commercially sound advice from someone who understands both you and the law.

Should you find yourself in receipt of an employment tribunal claim, take advice early. At an early stage it is possible to consider strategy and to take robust action if a claim does appear to be without merit. There shouldn’t be alarm at the change on the part of employers. Rather that we need to be aware of the change and what to do.

For more advice, contact Marie Maguire or a member of our employment team on 0345 070 6000.