Employment Tribunal Fees

Business Secretary, Vince Cable, spoke of wide-ranging employment law reforms in November 2011.  Part of these was the introduction of fees at Employment (ET) and Employment Appeal Tribunal (EAT).  This was also discussed as part of a previous consultation, Resolving Workplace Disputes.  The fee-charging regime is designed to minimise the cost of the ET and EAT to the taxpayer, currently estimated to be around £84 million.  Also, charging is an attempt to encourage early conciliation and resolution of employment disputes before a case even gets to Tribunal.

A consultation was launched at the end of 2011 / start of 2012 but did not discuss the principle of a charging regime, as this was already stated as Government’s intention.  The consultation did propose two alternative charging structures for the ET:

• Option 1 was a two-stage charging system, with one fee payable at the time the claim is lodged (issued) and a second fee payable at the time the case is heard
• Option 2 proposed a single-charge system, with the amount of the fee payable being dependent on the type of claim and the value of the award being sought by the claimant

A single-charging structure was proposed for EAT cases similar to Option 1.  A fee would be paid at the time an appeal is lodged and a further fee paid at the time the appeal is heard at Tribunal.

Following consultation, the Government has produced its responses document together with its proposals.  Claims will be categorised into two levels:

1. Level 1 – this will, generally, be for cases involving amounts of money due or unpaid on termination of employment, for example, payments in lieu of notice, unpaid / withheld wages, redundancy payments; and
2. Level 2 – these are more employment-law related cases, for example unfair dismissal, discrimination and equal pay

The proposed Employment Tribunal charging structure is:

Multiple claims (i.e. the same complaint but by more than one person) will result in higher amounts as the fees will be subject to a multiplier, depending on the number.

Further, fees will be charged for:

• Counter claims (in a breach of contract case)
• Applications to request a default judgement (where a defendant fails to defend a claim)
• Application for dismissal (following the settlement or withdrawal of a case)
• Application for review (of the Tribunal’s decision)
• A fee for mediation (the cost of a judge, Level 2 only)

The proposed fees are as follows:

Note the following points:

• All fees will be paid in advance and apply to the person / employee who is bringing the action
• There will be no separate fee for requesting a written decision where a response has previously been given orally.  The initial consultation proposed such a fee, however, Government considered the overwhelming objections to this proposal, agreeing that this information should be provided as part of the Hearing Fee
• The £600 mediation fee is set at a level to encourage use of the judiciary, however, will be reviewed
• People on low incomes in civil courts are subject to pay lower fees under the remissions system.  Such a system will be introduced, ensuring that all people, regardless of income, have access to the tribunal system.

For claims to the Employment Appeals Tribunal (EAT), the consultation only proposed one charging structure, similar to Option 1:

The responses document is clear in that it does not believe that the fees are excessive or a barrier to the EAT system.  However, it should not be up to the taxpayer to ‘subsidise a user who has already had the benefit of a previous judicial decision’.

The fee structure is planned for the summer of 2013.  The Tribunal will be able to rule that the injured party should be reimbursed their fees.

Comment

The intention of seeking an up-front fee payment is that parties will be encouraged to mediate and seek resolutions without the need for using the Tribunal system.   The intention is not for the generation of revenue.  As such, over time, it will be interesting to monitor the use of the Tribunal system to see if they have been impacted as a result of these changes.

Further Information

• Justice Website  – Introducing Fees      at Employment and Employment Appeals Tribunal
• BIS Website  – Resolving Workplace Disputes – Government Response to the Consultation