Will the End of Tribunal Fees Affect Your Practice?

By now, you’ve probably heard about the ruling by the Supreme Court that the Employment Tribunals and the Employment Appeal Tribunals Fees Order 2013 (which led to a 70% reduction in claims) is unlawful and will be removed. What does the end of tribunal fees mean for GP Practices and other small businesses?

Can practices expect to see a rise in costly and vexatious claims? The general consensus seems to be no. The research submitted to the court indicated that the ratio of vexatious claims to genuine claims had not actually increased following the introduction of fees, so there is no reason to expect their removal will change those statistics either.

In summary, the key points were: 

  • There was a stark contrast between the level of fees in the tribunal and the small claims court (where it is very much cheaper to bring a claim for a small sum of money), which was unfair. 
  • Employment tribunal cases are important for society as a whole, not just the individuals involved and the Fees Order prevented access to justice, making it automatically unfair. 
  • Around 10% of claimants, whose claims were notified to ACAS but did not result either in a settlement or in a claim before an ET, said that they did not bring proceedings because they could not afford the fees. 
  • Many claims which can be brought in ETs do not seek any financial award: for example, claims to enforce the right to regular work breaks or to written particulars of employment and many claims which do seek a financial award are for modest amount. 
  • If those conditions are not met, the fee will in reality prevent the claim from being pursued, whether or not it can be afforded. In practice, however, success can rarely be guaranteed. 
  • In addition, only half of the claimants who succeed in obtaining an award receive payment in full, and around a third of them receive nothing at all, as orders for payment are difficult to enforce. 

Statistical evidence relating to the impact of the Fees Order on the value of awards came from a number of areas, including the Council of Employment Judges and the Presidents of the ETs, the Department of Business, Innovation and Skills, and ACAS.

All established that in practice the Fees Order had a particularly deterrent effect on the bringing of claims of low monetary value. That’s in line with what we might expect, given the apparent futility of bringing many such claims, in view of the level of the fees and the prospects of recovering them.

It was also noted that the fee system indirectly discriminated by charging higher fees for type 'B' claims (which include discrimination claims) than type 'A' claims. By their very nature, type ‘B’ claims were likely to involve protected characteristics, which put low-paid women at a particular disadvantage.

So, what do the legal boffins think will happen next? Daniel Barnett, Employment Law Barrister, believes that: 

  • It is unlikely the fees regime will be abolished entirely. It’s probable that the government will issue a consultation paper and then bring in a new fees regime, with fees at a lower level and/or involving a fee payable by the employer when the employer lodges its ET3. 
  • Thought will need to be given to an immediate rewriting of the tribunal rules, and a reprogramming of the online Claim Form system. 
  • The Supreme Court made it clear that all fees paid between 2013 and now will have to be refunded by the Lord Chancellor's Department (and the Lord Chancellor has agreed to do so).

    This is easier said than done - many successful claims will have had fees ordered to be paid by the Respondent, and there will probably need to be a manual trawl of all decided cases.  
  • There is no clarity yet around concerns that all the people who chose not to bring a claim because of the fees may now be able to do so even though they have passed the deadline, in many cases, by several years.

Will tribunals be amenable to the argument that it was not reasonably practicable to bring a claim when a Claimant was significantly impeded from doing so by an unlawful fees regime? Or that following today's decision it is just and equitable to extend time for bringing a claim?

What are your thoughts on the Supreme Court’s decision? Let us know in the comment section below, and stay tuned to the FPM Blog for the latest views on the stories that matter most to PMs.


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