Thursday, July 27, 2017

Goodbye to Employment Tribunal Fees - For Now At Least

In a Judgment which has taken many people by surprise the Supreme Court has ruled that the Fees Order which introduced Employment Tribunal Fees in 2013 is unlawful.

A summary of the Supreme Court's decision is here but in essence the Fees were found to be unlawful because they were an unjustified interference in the right of access to justice, were in breach of EU law and were indirectly discriminatory against women.

The number of Employment Tribunal Claims has dropped by 79% since the introduction of fees. To bring a money claim to a full hearing involved potential Fees of £390 (even if the amount at stake was less than this) and to bring more substantial cases such as Unfair Dismissal or Discrimination involved fees of up to £1200.

As a result of the Judgment the Government will have to refund all of the Fees paid, some £32 million or so. This will not be straightforward, not least as winning Claimants will in many cases have recovered the Fees from their employers, who will no doubt now want that money back.

The Judgment is good news for Claimants but obviously is potentially less good news for Respondents. It removes a disincentive to claiming, which is likely to result in more Tribunal Claims being lodged, although whether there will now be a 79% increase must be somewhat doubtful.

Employers would do well therefore to ensure that they have proper advice as to their legal obligations and how to handle sticky situations with a view to avoiding ending up in the Tribunal in the first place.

Where Claims are brought as a "try on" by Claimants who think that without Fees they can have a "free hit" there are steps which can be taken to try and put the Respondent back on the front foot, such as applying for strike out, giving Costs Warnings and applying for Deposit Orders.

This may well not be the end of Tribunal Fees. The Government might try and reintroduce an amended scheme (presumably with lower fees) but given the complicated Parliamentary arithmetic following the General Election it remains to be seen whether fresh legislation would be passed.