By far the most important employment case for many years because its impact is massive, the Supreme Court has ruled that employment tribunal and Employment Appeal Tribunal fees are unlawful.
Fees were first introduced in the employment tribunals and the Employment Appeal Tribunal on 29 July 2013 by the Employment Tribunals and the Employment Appeal Tribunal Fees Order 2013 (the “Order”).
As a result of the Order, fees were charged depending on the type of claim brought. An issue fee was payable by prospective Claimants together with a separate hearing fee. Claims were categorised as Type A (e.g. unlawful deduction from wages and breach of contract) and these had lower fees than Type B (e.g. discrimination and unfair dismissal) claims. A remission scheme was in operation allowing individuals to apply for full or partial remission taking into account the individual’s disposable capital and gross monthly income.
The introduction of the fees regime resulted in a significant decline in the number of claims brought.
Unison, launched judicial review proceedings and challenged the lawfulness of the fees regime taking into account the impact of the Order. Following an appeal by Unison, the matter was eventually heard by a seven-member panel of the Supreme Court on 27 and 28 March 2017.
Amongst other matters, Unison argued that:
- The effect of the fees was such that claimants were being denied access to justice which was a constitutional right resulting in a significant decline in claims. As such the Order was unlawful and ultra vires.
- The imposition of the higher level of fees for Type B claims was discriminatory against claimants with protected characteristics.
The Supreme Court unanimously allowed the appeal declaring that the Order prevented access to justice, was unlawful and must be quashed.
What does this mean?
The impact of this ruling is huge. All employment tribunal fees paid since 2013, including EAT fees, will need to be reimbursed. It is not yet clear how reimbursement on such a large scale will work. As a result of the judgment, fees are no longer payable and the government website has been amended making it clear that claimants do not have to pay a fee to bring a claim.
It remains to be seen whether tribunal fees will be scrapped altogether, or whether a new fees regime will be introduced in due course.
We are also likely to see an increase in new tribunal claims given that the number of claims had decreased by approximately 70% since fees were introduced. That said, the ACAS early conciliation process still remains a very useful process for settling cases at the pre-tribunal stage. We may also see claims being lodged by claimants who are time barred but seek to argue that they could not bring a claim in time because of the level of fees and that they should be granted an extension of time. There may be a number of test cases on this point alone.
Given this backdrop, it is now more important than ever for employers to ensure that staff matters are handled correctly and that policies and procedures are fully compliant and meet operational requirements.
Gregory Abrams Davidson LLP Solicitors offer a comprehensive employment law service which is extremely well received by our clients.
We offer the full range of employment law services. Part of our service offering is our GAD HR Scheme which provides a cost-effective solution for employment law and HR matters.
What is the GAD HR Scheme?
The Scheme is a fantastic service providing employment law and HR support at a fixed fee. Benefits of the Scheme include:
- An advice line – direct contact with a specialist employment solicitor on HR and employment law matters
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- Documentation – contracts of employment, staff policies and procedures
- Comprehensive insurance cover – indemnity against most awards of compensation and legal fees should one of your employees bring a claim against you
- Regular employment law updates
- Fixed monthly fee – for better financial planning
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Please contact Neeta Laing on 0151 494 0777 or email firstname.lastname@example.org to discuss your requirements. We would be delighted to assist.