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Employment Tribunal fees are unlawful – Supreme Court

employmentlaw@work / 26 July 2017

ISSUE:

The Supreme Court (‘SC’) in R (on the application of Unison) v Lord Chancellor [2017] has held unanimously that the current system of Employment Tribunal (ET) fees is unlawful under both domestic and EU law because it has the effect of preventing access to justice.

In 2013, the Government introduced the Employment Tribunals and the Employment Appeal Tribunals Fees Order 2013 (‘the Fees Order’) which brought in standard fees for making claims in Employment Tribunals.

UNISON, supported by the Equality and Human Rights Commission, challenged the lawfulness of the fee regime. UNISON lost in two Divisional Court hearings, and in the Court of Appeal before appealing to the SC.

The SC, allowing the appeal, agreed with the evidence before it that the Fees Order has led to a dramatic and persistent fall in the number of claims brought in ETs, with a greater fall in the number of lower value claims and claims in which a financial remedy was not sought.

The SC found that there was a “real risk” that the Fees Order effectively prevents people from having access to justice; the evidence showed that the fees were not set at a level that everyone could afford.  Furthermore, the SC stressed that ET cases are important for society as a whole, not just the individuals involved.

You can read the full judgment here.

KEY DATES:

The judgment was released today, 26 July 2017.

IMPACT:

As of today, tribunal fees cease to be payable for claims in the Employment Tribunal and appeals to the EAT, and all fees which were paid in the past shall be reimbursed.  It is estimated that the Government will have to refund more than £27m in fees paid since July 2013 when the scheme was introduced.

It is highly likely that the decision will result in an increase in the number of employment tribunal claims brought.

ACTION:

Employers should be aware of the decision and prepare for the possibility of a rise in ET claims. It is likely that the Government will attempt to introduce a revised fee scheme which works around the criticism the SC have made of the existing scheme.  We will continue to keep you updated on future developments.

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