Archive for the ‘Employment Tribunal fees’ Category

Tribunal Fees – Judicial Review Fails

avatar Posted on February 7th, 2014 by Richard Kenyon

UNISON’s judicial review challenge to the introduction of fees in the Employment Tribunal system has failed. Superficially this is a tremendous result for employers. Far fewer employees are likely to challenge their treatment at work or their dismissals. Employers will be able to sit back and wait to see whether a potential claimant is prepared to pay to issue a claim and later to pay for the hearing itself. But the Tribunal system and the risk of claims underpins a whole framework of employment policies and processes which are fundamentally aimed at avoiding arbitrary and unreasonable management decisions in the workplace. The Judgment begins with a reminder of what we have lost: “From the introduction of the National Industrial Relations Court by the Industrial Relations Act 1971 until the Employment Tribunals and Employment Appeal Tribunal Fees Order 2013 an accessible statutory scheme for giving effect to employment rights existed at no cost to employer or employee save in very limited cases.”

The Government’s reasons for the reforms are said to be to avoid “drawn out disputes” which are “very emotionally damaging for workers and employers, as well as being financially damaging for employers”. Few would argue with that. However, those aims might have been achieved by more robust case management, weeding out weak cases and striking out cases for unreasonable behaviour, rather than introducing a system which financially deters those with genuine cases from enforcing their rights.

These reforms along with others such as the extension to two years of the minimum service requirement to claim unfair dismissal do not appear in the manifestos of the Conservative party or their Liberal Democrat coalition partners. No one voted for these reforms. In my experience even the most pro-deregulation industrialists can be appalled by the lack of employment protection when their wives, children and friends run into employment problems at work. UNISON have announced that they intend to appeal to the Court of Appeal. In the meantime and with an election on the horizon, maybe it’s time for the Labour Party to make a political commitment to repealing the fee system so at least the electorate has the opportunity to vote with a clear choice.

UNISON’s challenge, in which the Equality and Human Rights Commission appeared as Intervener, relied on four arguments.

The principle of effectiveness

The first argument was that the requirement to pay fees as a condition of access to the Employment Tribunal and Employment Appeal Tribunal violates the principle of effectiveness since it will make it virtually impossible, or excessively difficult, to exercise rights conferred by EU law. This principle is now enshrined in Article 19 of the Treaty on the European Union: “Member States shall provide remedies sufficient to ensure effective legal protection in the fields covered by Union law”. The Court acknowledged that effectiveness is especially important in the context of discrimination. It also acknowledged the very real difficulties of mounting a successful discrimination claim including that whilst the “ability to bring discrimination cases is a vital plank in the means of combating discrimination” the “outcome of bringing such claims is difficult to predict and the rewards are small, with an even chance of failing successfully to enforce them”.

The Court acknowledged that fees, even with a remission system, were high but “The very use of the adverb “excessively” in the jurisprudence suggests that the principle of effectiveness is not violated even if the imposition of fees causes difficulty and renders the prospect of launching proceedings daunting, provided that they are not so high that the prospective litigant is clearly unable to pay them.”

Much of the argument was run on the basis of hypothetical claimants but UNISON also introduced figures from Employment Tribunal receipt statistics (Management Information July-September 2013). These showed dramatic falls in claims comparing September 2012 with September 2013. For example, a fall in all claims of 56%, of claims in the North West region of 82%, in Wales of 88%, in all Equality Act discrimination claims, including equal pay, of 78%, of sex discrimination claims of 86%, and of unfair dismissal claims of 81%. The Lord Chancellor contended that it was far too early to rely upon the accuracy of those percentages. But, the Court acknowledged, if they are anything like accurate then the impact of the fees regime has been dramatic.

Ultimately, the Court agreed with the Lord Chancellor’s submission that it was too early to tell whether the principle of effectiveness was being violated. The door is therefore left open to a later challenge based on more accurate data of what is actually happening in practice.

The principle of equivalence

UNISON’s second argument was that the requirement violates the principle of equivalence since the requirement to pay fees or fees at the levels prescribed means that the procedures adopted for the enforcement of rights derived from EU law are less favourable than those governing similar domestic actions. There were complications in trying to make a comparison between Tribunal claims and those in the County Court in particular around the risk of costs in the County Court and the coming pre-claim conciliation process in the Tribunal. In the Court’s view, UNISON failed to demonstrate any breach of the principle of equivalence.

Public Sector Equality Duty

The third argument was that in reaching the decision to introduce the new fees regime and in making the 2013 Order the defendant acted in breach of the Public Sector Equality Duty. The Lord Chancellor has a duty to have due regard in exercising his functions to the need to eliminate discrimination, advance equality of opportunity, and foster good relations between those who share protected characteristics and those who do not under s.149(1) of the Equality Act 2010.

The Court acknowledged that a public authority must collect, collate and consider all relevant information as to the likely impact of its proposals. However, it is for the public authority to decide what is relevant and irrelevant, subject only to challenge on conventional public law grounds. The Court seems here to have undertaken a quantative rather than qualitative assessment of the work that was put into equality impact assessing the proposals. Various consultations and assessments were undertaken but whether they were any good is not really explored.

Indirect discrimination

UNISON’s final argument was that the effect of the 2013 Order is indirectly discriminatory and unlawful. The argument runs that the apparently neutral provision, criterion or practice of requiring claimants to pay a higher fee in Type B cases rather than Type A cases, disadvantages a substantially higher proportion of those within a protected class, such as women, ethnic minorities, and the disabled and cannot be objectively justified. The Court acknowledged the complexity of the argument but seems to have taken a too early to tell, too little time to assess attitude to the evidence.

Overall, the Court acknowledged the genuine fear that the introduction of the fee regime will impede the vital goal of eliminating discrimination and advancing equality of opportunity. Whether that fear is well-founded may well depend on evidence yet to be obtained, as to how the regime has worked in practice. Cold comfort to those who lose out in the meantime!

Recap of key employment law changes

avatar Posted on July 30th, 2013 by Sophie Westmacott

Following yesterday’s media furore in relation to the introduction of tribunal fees, Unison’s unsuccessful last-minute attempt to obtain an interim injunction to prevent the fees being introduced and, in some cases, the misreporting of other significant changes, we thought it would be useful to recap in summary the key changes which have taken effect and on which we have reported previously in this blog: 

1. Introduction of Tribunal fees – The new fee regime involves payment of an issue fee when the claim is submitted and a hearing fee which would be paid prior to the full merits hearing.  For a reminder of the fee structure and the level of fees click here.

Meanwhile, the High Court has granted Unison permission to proceed with a judicial review hearing over the introduction of fees for claims in Employment Tribunals and Employment Appeal Tribunals.  The full hearing is listed for October 2013.  Unison’s application for an interim injunction against the introduction of the fee regime was refused.  For information on Unison’s arguments against the introduction of fees click here

2. New unfair dismissal compensatory limit – The new limit on the compensatory award for unfair dismissal is now the lower of one year’s gross pay or the current statutory cap of £74,200.  

3. New Tribunal Rules of Procedure – The new rules have introduced new ET1 and ET3 forms, combined case management discussions and pre-hearing reviews into new preliminary hearings and introduced an initial paper sift for new claims in the Employment Tribunal.  

4. Pre terminations negotiations - Offers to end the employment relationship on agreed terms can be made on a confidential basis by employers and cannot be used as evidence in an unfair dismissal claim to an Employment Tribunal.  This protection will not apply where there is improper behaviour in the negotiation process.  The ACAS Code of Practice on Settlement Agreements is also operational and provides useful guidance to employers about how to deal with pre-termination discussions and in understanding the limitations of Section 111A of the ERA.  Please click here for the ACAS guidance on settlement agreements. 

5. Compromise agreements renamed “settlement agreements” – Compromise agreements have been renamed “settlement agreements” in all relevant employment legislation.  

“The Government should not put a price on justice…” says UNISON

avatar Posted on June 20th, 2013 by Caroline Casbolt

UNISON has announced that it is calling for a judicial review of the decision to introduce employment tribunal fees.  Currently the Government plans to introduce fees on 29 July 2013. 

The main arguments UNISON will pursue appear to be that:

1.    It is unlawful to introduce fees which make it impossible or excessively difficult to enforce European Community law.  UNISON are concerned that the fees will prevent working people from exercising their employment rights, as in some claims the fees imposed will be greater that the anticipated compensation.  Fees for starting proceedings are £160 or £250 depending on the type of claim; with a further hearing fee of £230 or £950 (subject to means testing).

2.    Fees are not payable at all in most claims brought to the First-Tier Tribunal (a similar tribunal at the equivalent level in the judicial hierarchy to the Employment Tribunal).  UNISON is of the view that it is a breach of the principle of equivalence to require fees to be paid to vindicate EU rights where no fees are required to vindicate similar rights derived from domestic law. 

3.    Fees indirectly discriminate against women, who generally earn less than men. Given that women will not (if they are earning an average income) be entitled to remission, UNISON does not consider that impact could be said to be a proportionate means of achieving a legitimate aim.

4.     There has been no proper assessment of the Public Sector Equality Duty.  UNISON considers that an assessment should have been made of the potential adverse effect of introducing fees.  Specifically, insofar as the numbers and proportions of claims pursued by individuals with protected characteristics which would previously have been brought before the introduction of fees and will now not be pursued.

UNISON initially wrote to the Ministry of Justice on 1 June 2013 warning them if they did not revoke the legislation UNISON would lodge proceedings.   However, it is unclear from UNISON’s press release whether the application has been lodged at the High Court. 

Tribunal fees have been controversial from the time they were first proposed by the Government.  Although they are due to be introduced in just over a month, it is perhaps unsurprising that they are being challenged.  We will provide further updates on the UNISON challenge on our blog.

Tribunal fees – update

avatar Posted on May 31st, 2013 by Sophie Westmacott

HM Courts and Tribunal Service (HMCTS) has confirmed the date on which fees will be introduced into the Employment Tribunal (ET) and Employment Appeal Tribunal (EAT) as Monday 29 July 2013.  In a letter to stakeholder HMCTS states that, from this date, “all ET and EAT appeals will be liable under the Fees Order and supporting rules to pay a fee or provide an application for fee remission against that fee under the HMCTS remission scheme”.

The proposed fee structure involves payment of an issue fee when the claim is submitted and a hearing fee which would be paid prior to the full merits hearing.  Here is a reminder of the proposed fee structure. This was set out in the draft statutory instrument which was laid before Parliament in April 2013:

Level A claims – these are claims “generally for sums due on termination of employment e.g. unpaid wages, payment in lieu of notice, redundancy payments”. The issue fee for such claims will be £160; the hearing fee will be £230.

Level B claims – these include those relating to unfair dismissal, discrimination, equal pay and whistleblowing. The issue fee for such claims will be £250; the hearing fee will be £950.

Multiple claims – the issue fees and hearing fees will be higher, depending on the number of claimants in the multiple claim. For example, for Level A claims, the issue fee for 2-10 claimants will be £320 (twice the single fee).

Other fees – other fees will apply to specific applications. For example, for an application for review in relation to a Level A claim, the fee would be £100.

Employment Appeal Tribunal – the proposed fee for an appeal is £400; the proposed fee for the hearing is £1,200.

Many people on low incomes may not be required to pay the full fees, under the same remission system which already exists for court users who pay fees to use the civil courts’ services. The Government has recently consulted on the remissions scheme and aims to implement a new remission scheme in October 2013.  The Government has also stated that it is committed to reviewing the fee structure once implemented to assess its impact in order to consider if changes are needed.

Videocast – changes to Employment Tribunal system

avatar Posted on April 12th, 2013 by Richard Kenyon

The Employment Tribunal system is set for a major overhaul. There are various changes on the horizon, including early conciliation; new Employment Tribunal fees and rules; changes to unfair dismissal compensation and new financial penalties. 

Some proposals are due to come into force in a matter of months. Our videocast highlights the key changes and how they may affect you. Further detail is provided in our accompanying briefing note, “Employment Tribunal litigation – understanding the changes”.

Employment Tribunal fees – online payment

avatar Posted on January 17th, 2013 by Louise Fernandes-Owen

The Ministry of Justice has published its digital strategy, indicating that it will provide an online service for the payment of Employment Tribunal fees from July 2013.

Here is a reminder of the proposed fee structure. This was confirmed by the Ministry of Justice back in July 2012, in its response to the consultation on Employment Tribunal fees:

Level 1 claims – these are claims “generally for sums due on termination of employment e.g. unpaid wages, payment in lieu of notice, redundancy payments”. The issue fee for such claims will be £160; the hearing fee will be £230.

Level 2 claims – these include those relating to unfair dismissal, discrimination, equal pay and whistleblowing. The issue fee for such claims will be £250; the hearing fee will be £950.

Multiple claims – the issue fees and hearing fees will be higher, depending on the number of claimants in the multiple claim. For example, for Level 1 claims, the issue fee for 2-10 claimants will be £320 (twice the single fee).

Other fees – other fees will apply to specific applications. For example, for an application for review in relation to a Level 1 claim, the fee would be £100.

Employment Appeal Tribunal – the proposed fee for an appeal is £400; the proposed fee for the hearing is £1,200.

Many people on low incomes may not be required to pay the full fees, under the same remission system which already exists for court users who pay fees to use the civil courts’ services. The Government has also stated that it is committed to reviewing the fee structure once implemented to assess its impact in order to consider if changes are needed.

New rules, new fees

avatar Posted on July 24th, 2012 by Louise Fernandes-Owen

The Government has proposed a whole host of changes to employment law over the last few months – most recently, a fundamental review of the employment tribunal rules and the controversial introduction of fees for bringing a claim.

Click here to read an article in People Management written by Richard Kenyon, Head of the Employment and Pensions Group at Field Fisher Waterhouse, which discusses the impact of these proposals.

Consultation – Charging Fees in Employment Tribunals

avatar Posted on December 21st, 2011 by Louise Fernandes-Owen

The Ministry of Justice has recently launched a consultation on the proposal to charge fees for bringing a claim in the Employment Tribunal. This is one of the Government’s many controversial proposals, forming part of the wider reforms to encourage early resolution of workplace disputes.

In the financial year 2010/11, 218,000 Employment Tribunal claims were presented and 2,048 appeals were made to the Employment Appeal Tribunal, costing the taxpayer £84.2 million. The Government has therefore proposed two fee charging structures to reduce the cost to the taxpayer whilst protecting access to justice for the most vulnerable.

There are two proposed fee options. Option one would require a claimant to pay an issue fee between £150-£250 to bring a claim. A further fee, between £250-£1,250, would be payable by the claimant if the claim went to a hearing. Option two requires the claimant to provide an estimate of the award they are seeking from the Tribunal. The issue fee will vary from £200-£1,750, depending on whether the claimant is seeking an award higher than £30,000. For both options, the Tribunal would also have the power to order the losing party to reimburse the fees of the successful party.

The proposals will bring Employment Tribunals more in line with Civil Courts where claimants are required to pay an issue fee. However, there are concerns that the introduction of fees will deny workers basic access to justice. For example, the TUC General Secretary Brendan Barber commented that the Government’s proposals to introduce fees “will effectively prevent the poorest and most vulnerable workers from ever being able to get justice”. However, it is worth noting that HM Courts & Tribunals Service operates a “remission system” whereby an individual may be entitled to part or full remission of fees. If, for example, a claimant is in receipt of Jobseekers’ Allowance or Income Support this may mean that no fee is payable.

The CBI has welcomed the introduction of fees as a good way of weeding out more of the weak and vexatious claims and, in principle, it may appear that the fee proposals would deter claimants from seeking to bring unmeritorious claims. However, arguably, due to the proposal for fees to be means tested, it may not in practice reduce the number of claims being brought.

The consultation closes on 6 March 2012. If the Government decides to implement option one, fees would be introduced in 2013. If option two is adopted, it is unlikely to come into force until 2014.

Unfair dismissal qualifying period increases and new fees for bringing claims

avatar Posted on October 3rd, 2011 by Louise Fernandes-Owen

The Department for Business, Innovation and Skills (BIS) has confirmed today that the qualification period for the right to claim unfair dismissal will be extended from one to two years from 1 April 2012.

The announcement follows some confusion last week. BIS originally published a consultation paper earlier this year which covered this issue (amongst others) but the response to the consultation has not yet been published. When BIS published its ‘One-In, One-Out, Second Statement of New Regulation’ last week, it appeared to indicate that a decision had already been reached on whether to increase the qualifying period for the right to claim unfair dismissal. BIS subsequently reissued the publication last week, indicating that this remained a “proposal”.

The reissued publication also stated that the Government will be introducing fees for lodging employment tribunal claims. Chancellor George Osborne has confirmed this in his speech to the Conservative party conference today, indicating that claimants will only get back the fee if they win. According to a BBC report today, the fees will come into force from April 2013 and the amount that will be charged and how it should be paid will be subject to consultation starting by the end of November. Some newspapers have given an indication of the fees. For example, the Guardian reports that anyone applying to make a claim at an employment tribunal will have to pay a fee of between £100 and £150, a full-scale hearing will cost £1,000, and any claim for more than £30,000 in compensation will cost more.

Both these announcements are significant changes to employment law. However, the detail regarding the introduction of fees has yet to be confirmed, so watch this space. This seems more to do with conference week posturing by a Chancellor under pressure than well thought out policy development. Making a class of people with less than two years’ continuous employment vulnerable to arbitrary dismissal is one way of creating a “flexible workforce”. However, those deprived of the right to claim unfair dismissal will be forced to consider bringing far more complicated and costly claims for discrimination. Many of them will be the young, women returning to work following time off to have children and ethnic minority and disabled employees struggling to get a foothold in the workforce. It will also be interesting to see whether the Tribunal fee system, which has been considered and rejected many times before, stands up to scrutiny once an inevitable list of exemptions has been worked through and once the cost of administering the collection of payments has been added in to the benefit/burden equation. It will no doubt be said that those who have been wronged will have nothing to fear from a fee system as the fees will be returned if they win their cases. That rather ignores the relative financial risk that an employee faces in litigation and the complexities of employment related disputes.