Employment Tribunal Fees Might Make a Comeback

The Government has begun a consultation for the proposal to reintroduce employment tribunal fees. This comes around seven years after a similar Government scheme was scrapped following a Supreme Court ruling. Despite the Government providing a rationale for the scheme, the Trades Union Congress (TUC) has slammed its reintroduction. 

Below, we first take a look at the previous scheme implemented by the Government and explore why it failed. Then, we address the reasons why a new scheme is being proposed. Finally, we examine the potential impacts should employment tribunal fees be reintroduced.

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Supreme Court Found Employment Tribunal Fees to be Illegal

In July 2013, employment tribunal fees were introduced, with varying amounts payable for different types of claims. ‘Type A’, comprising issues like pay disputes, had a £160 ‘issue fee’ and £230 ‘hearing fee’. ‘Type B’, composed of complex problems like discrimination, had a £250 issue fee and £950 hearing fee. If an appeal were made, the total fee would be £1600.

However, the Supreme Court held the fees were unlawful in 2017, meaning the scheme was scrapped and claimants were refunded. This came about after UNISON, Professor Abi Adams-Prassl, and Professor Jeremias Adams-Prassl outlined the scheme’s shortfalls. They highlighted a distinct barrier to justice as pursuing a claim would be irrational, typically resulting in a low-value payoff.

Government Rationalises Employment Tribunal Fees

The Government has provided a rationale concerning the reintroduction of employment tribunal fees. They stated that between 2022 and 2023, tribunal costs totalled £80 million. This accounted for 85,000 claims made during the year and was covered by taxpayers. As such, they reasoned the fees would relieve the cost to taxpayers while maintaining tribunals’ efficiency and effectiveness.

Furthermore, the Government said that ACAS early conciliation was funded by taxpayers during the same period, which amounted to £58 million. They explained that implementing modest employment tribunal fees would encourage more early settlements to avoid these costs. They went on to say this would provide better value for taxpayer money and reduce the stress on tribunal services.

Finally, the Government stated they’ve learned from the Supreme Court ruling, focusing on affordability, proportionality and simplicity. As such, they aim to ensure employment tribunal fees don’t make it irrational to pursue low-value claims. This includes implementing the Help with Fees remission scheme to provide relief and access to justice to those facing financial difficulties.

What Does This Mean for Employees?

Following the conclusion of the consultation in March 2024, the Government looks to implement the employment tribunal fees from November. If this occurs, employees looking to bring a claim to an employment tribunal will incur a flat fee of £55. If there are multiple claimants, the fee would be evenly shared between them.

As mentioned, if individuals genuinely can’t afford the fee, relief will be available for those who are eligible. One example includes single individuals without children whose disposable capital and gross monthly income are below £4,250 and £1,421, respectively. There will also be a few instances where claims are exempt from fees.

The TUC Slams the Government’s Tribunal Fees Scheme

However, the TUC believes the Government’s stance shows they’re “taking the side of bad bosses” rather than prioritising employment rights. The TUC’s general secretary, Paul Nowak, said this reintroduction would make it “even harder for working people to seek justice”. He added, “Last time they introduced tribunal fees, claims dropped by two-thirds”, explaining they present another hurdle to seek justice.

Therefore, whilst the Government claim the employment tribunal fees will relieve the burden on taxpayers, the TUC believe it’s not the claimants’ responsibility. Even if the fees are minimal and relief is provided, the TUC doesn’t think claimants should pay for exploitative employers.

With our final thoughts, many will be uncertain about the consultation outcome, which is likely a very contentious topic. Some may view the scheme as a taxpayer benefit, whilst others could see it as punishing employees exercising their rights. Despite this, the Government will probably want to proceed carefully to ensure history doesn’t repeat itself.

If you want to make an employment tribunal claim, contact Redmans Solicitors now. We are employment law specialists and could assess your circumstances before advising on your possible next steps. Moreover, we offer numerous funding options to help meet your circumstances.

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