The Justice Committee has published its review into court and tribunal fees. The report finds that the introduction of issue and hearing fees for claimants in employment tribunals in July 2013 has led to a drop of almost 70% in the number of cases brought.
The Committee makes it clear that it does not in principle object to the raising of income from claimants through fees. However, ‘what counts, in our view, is that a fee system should not unreasonably damage access to justice’.
Key Findings
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A 67% drop in the number of single claims to around 4500 per quarter.
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A 72% drop in the number of multiple cases to around 400 per quarter.
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Fees ‘have had a significant adverse impact on access to justice for meritorious claims’.
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It was too early to judge whether fees were deterring vexatious claims.
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The government’s assertion that the drop is largely attributable to the success of ACAS early conciliation is ‘even on the most favourable construction, superficial’. In fact, it was noted that in many cases the existence of fees acts as a disincentive for employers to resolve disputes at an early stage – often they will prefer to wait and see if the claimant does in fact pay the fee and proceed with the claim.
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The level of fees should be substantially reduced (no information was provided on what might be appropriate).
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The ‘type A’ and ‘type B’ claim distinction does not relate to the complexity or length of cases. Currently, type A claims include unlawful deductions from wages; notice pay, holiday pay; and redundancy pay while type B claims cover unfair dismissal; discrimination; equal pay; and whistleblowing. The report suggests replacing the type A/type B distinction with either a single fee; a three-tier structure (e.g. short track (e.g. unpaid wages); standard track (e.g. unfair dismissal); and open track (e.g. discrimination); or by a level of fee set as a proportion of the amount claimed.
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Income thresholds for fee remissions should be increased, while the remission system should require only one application to cover both issue and hearing fees.
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Special consideration should be given to maternity or pregnancy discrimination cases (following evidence that tribunal fees are having a discriminatory effect in relation to pregnant women and new mothers), in particular a review of the three month time limit for bringing claims.
Unison’s Legal Challenge
The challenge to tribunal fees brought in the courts by Unison was dismissed by the Court of Appeal last year. Unison unsuccessfully argued that fees prevented claimants from having access to justice; that the regime was indirectly discriminatory; and that the public sector equality duty had not been satisfied. In particular, Unison’s appeal failed due to lack of evidence as to the impact of fees on individual claimants.
An appeal in the Supreme Court is expected to be heard in December, so watch this space.
Status of the government review
This Justice Committee report is separate from the government’s separate ‘Employment Tribunal Fees Post Implementation Review’. The government review was commissioned in 2015 but is yet to be published (something criticised by the Justice Committee in its report as ‘unacceptable’).
What does the future hold re ET fees?
Employers have been largely enjoying the period since fees were introduced and for now the fees are here to stay, but in what form it is difficult to predict. Much will depend on the findings of the government’s review (and subsequent consultation) and the Supreme Court’s decision in the Unison case. Also complicating matters is the fact that employment tribunal fees might ultimately be devolved in Scotland. However, the likelihood is that fees will be kept but at a much lower rate so as not to deny those claims with merit.
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