For a number of employee claimants and their representatives, the news contained in this article will come as a pleasant mid-week surprise.
In the case of R (on the application of UNISON) v Lord Chancellor, The Supreme Court of England and Wales has issued a very noteworthy judgment on the unlawfulness of Employment Tribunal (ET) Fees, which have been a source of heated debate since their introduction almost 4 years ago on 29 July 2013.
In terms of the claims that an employee is seeking to bring, these are categorised as ‘Type A’ claims and ‘Type B’ claims.
Type A claims include (but are not limited to):-
- Breach of contract;
- Failure to pay a statutory redundancy payment;
- Failure to inform and consult employees in line with the Transfer of Undertakings (Protection of Employment) Regulations 2006 (also known as TUPE);
- Failure to allow time off to employees for trade union duties or public duties (the latter including jury service), and
- Failure to provide time off for employees who care for dependants.
Type B claims include:-
- Unfair dismissal;
- Whistleblowing/protected disclosures, and
- Equal pay.
Typically, unless a remission of fees applied, an employee would need to pay a fee to issue a claim before the employment tribunal, followed by the payment of a hearing fee.
For Type A claims, the fees were as follows:-
- £160.00 to issue the claim, and
- £230.00 for a hearing.
For Type B claims, the fees were as follows:-
- £250.00 to issue the claim, and
- £950.00 for a hearing.
In the leading judgment of The Supreme Court, Lord Reed held that, as they stand, ET Fees are disproportionate when compared with fees in the civil courts as “Even the highest fees in the County Court for small claims are well below the ET fees for type B claims”.
In addition, Lord Reed held that, although ET fees had discouraged employee claimants from bringing groundless claims and had encouraged earlier settlements in genuine claims, “the value to society of the right of access to the courts is not confined to cases in which the courts decide questions of general importance”. In other words, access to justice is not just limited to big cases.
The Court therefore held that ET fees are unlawful, both under the Law of England and Wales and under European Union Law, on the basis that:-
- ET fees as they stand have not been set at an affordable level;
- For an approximate 10% of claims notified to ACAS that had not proceeded either to settlement or to the ET, employee claimants had reported that they had not approached the ET because of the fees involved in doing so;
- For low to middle income households, the cost of paying ET fees (irrespective of recovery at the end of the tribunal process) would likely result in employee claimants sacrificing their ordinary and reasonable expenditure (i.e. on everyday essentials and luxuries, such as holidays) for substantial periods of time, and
- The fees as they currently stand are disproportionate to the sums being claimed by employee claimants (Lord Reed gave the example of an unlawful deduction of wages claim where the fees incurred would be a total of £390.00 to claim back a hypothetical figure of £500.00).
In addition, Baroness Hale, providing a supporting judgment in the same Court, held that charging higher fees for discrimination claims was itself an act of indirect discrimination against employee claimants.
The Court therefore held that the Government had gone beyond its powers in restricting access to justice.
Whilst the judgment of The Supreme Court does not state that ET fees in principle are unlawful and should be abolished, it does state that the ET fees as they stand are unlawful and should be abolished.
It is therefore likely that the Government shall keep ET fees as a concept in force and will continue to apply them, yet under a very different payment scale.
However, employee claimants from 29 July 2013 to the date of this decision should be mindful that they may be receiving a reimbursement of tribunal fees at some point in the future.
Meanwhile, employee claimants who have yet to pay their ET fees in current claims should contact the administrative court and tribunal centre handling their case for further information.
This article is not a substitute for legal advice on specific facts and circumstances. It is designed as a free update on the law at the time of publishing. Knight Polson Limited trading as QualitySolicitors Knight Polson accepts no responsibility for reliance on this article and recommends that you seek independent legal advice on your specific circumstances prior to taking any steps.
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