Tribunal Fees Abolished Immediately
The Supreme Court has today unanimously ruled that the employment tribunal fees imposed by the Lord Chancellor are unlawful and should be quashed.
As a result, the Ministry of Justice will have to repay to employee’s an estimated £27m to those who have already paid tribunal fees, backdated to July 2013 when the fees were introduced. It is not yet clear how or when these tribunal fees will be reimbursed.
Unison, the trade union who led the appeal, argued that tribunal fees are unaffordable and deterred individuals from bringing tribunal claims.
It was ruled that tribunal fees are unlawful under both UK and EU law because they prevent access to justice. This is a huge victory for Unison.
Lord Reed stated that “the fall in the number of claims has in any event been so sharp, so substantial, and so sustained as to warrant the conclusion that a significant number of people who would otherwise have brought claims have found the fees unaffordable.”
Lade Hale spoke about the higher fees charged for bringing Type B claims which include more complex claims such as discrimination. She stated that charging higher fees for discrimination claims is “indirectly discriminatory against women, who bring the majority of such claims, and others with protected characteristics who also bring them”. The result is that it has had a “deterrent effect upon discrimination claims”.
History of tribunal fees
Since July 2013, for an employee to progress an employment tribunal claim from being lodged to the final hearing, it would cost up to £1,200 in tribunal fees. Previously, tribunal claims could be lodged free of charge.
Tribunal fees were original introduced to prevent vexatious and spurious claims, and to incentivise early settlement.
Fee remissions were made available for employees who meet certain financial criteria i.e. are in receipt of specific benefits.
What happens next?
The Government will be required to take immediate steps to stop charging tribunal fees and begin the reimbursement process for employees who have paid tribunal fees dating back to July 2013.
It is likely that a consultation paper will be issued by the Government proposing a new regime, which may potentially involve lower fees, abolishing the fees completely or making the employer liable for any fees.
What impact will this have on businesses?
Employers will need to be aware that it will become more accessible to bring tribunal claims again. It is worth noting that employees will still be required to initiate ACAS Early Conciliation where there will be an opportunity to settle claims prior to issuing a claim.
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