New Consultation on UK Employment Tribunal Fees

In 2013, the Government introduced fees for bringing claims to the Employment Tribunal and the Employment Appeal Tribunal. Although they were then abolished following a Supreme Court ruling in 2017, the issue is back in the spotlight and the subject of fee-rocious debate once more following the publication of a Government consultation into their re-introduction. 

Last time round fees ranged between £390 and £1,200 for a claimant to bring a Tribunal claim, with the cost of taking a matter to the EAT totalling an additional £1,600. This led to a 50%+ reduction in the number of claims brought, and arguments that the fees acted as a barrier to justice. Employers were undoubtably fine with it, but the right of access to justice is as inviolable as it is sometimes inconvenient. The Supreme Court ruled that the 2013 Fees Order was unlawful ‘ab initio’ (or ‘from the off’ for any non-Latin speakers) and so it was duly quashed. Since then, cases have increased again, although not to pre-2013 levels.

The Government is now consulting on whether to re-introduce fees on a more limited basis, following the three principles of affordability, proportionality and simplicity with a mind to what is reasonable for claimants (often litigants in person) during the 3-6 month window in which they can submit a claim. It is proposing a flat issue fee of £55 that would cover the claim all the way through to hearing, with a further fee of £55 at the EAT for each judgment/decision being appealed.

The arguments from the government for re-introducing fees are threefold:

  1. It makes the ET system consistent with the other civil courts and tribunals, which also require fees;
  2. For those claims brought in the ET that could also be brought in the civil courts (e.g. breach of contract claims), it puts ET users on an equal footing; and
  3. It means that ET users contribute to the running of the service – the overall running cost of the ET/EAT was £80 million in 2022/23, and the running of Acas around £58 million for the same period (though there is no suggestion of any fee for a referral to Acas Early Conciliation by itself.

The first two reasons are moral arguments more than anything, which are likely neither here nor there in the mind of a claimant seeking to bring a claim (or indeed the lawyers defending it..!) The argument on costs is the greatest of the three, with all the debate that comes with it.

The Tribunal system is facing an extreme backlog following years of funding pressures exacerbated by the pandemic, so any additional resources would no doubt be gratefully received. However, the Government’s own consultation paper notes that this policy would only raise around £1.6-1.7 million per annum from 2025/26 onwards. Pocket money in comparison to what is arguably needed, but when considering things politically this may be part of a wider government push for ‘small wins’ that can be implemented and championed quickly in case the next election should yield a change of government. This is hardly something a Labour government would be inclined to introduce, but most people are arguably less inclined to get rid of something once it’s already there (a sentiment the Government presumably hopes the electorate take to heart at the next election).

The government has sought to defend itself against accusations of erecting a barrier to justice by keeping the fee rate flat at £55. Much as the pricing of a Dairy Milk at the tills makes you think that just one can’t be that bad, the proposed price point here is likely positioned so as not to be visibly off-putting. Considerably lower than the previous fee figures, it seeks to strike a balance between claiming ‘something rather than nothing’ from service users whilst not obstructing any access to justice. The Help with Fees scheme would also be extended to allow users to access full or partial fee remission dependent on criteria, and the Lord Chancellor would retain the Exceptional Power to remit fees at his/her own discretion. Multiple claimants in a single claim would also be treated as a single entity and be able to split the £55 between them.

Claims seeking payment from the National Insurance Fund however would be exempt from fees given their uncertain financial nature and the fact they are generally not conciliable.

The consultation runs until 25 March, so it remains to be seen whether this will come to pass (and if it does, in what form). Interestingly, the consultation also seeks views on whether fees could be higher, so it is possible then that we could subsequently see an incremental rise in fees, which may well once again prompt legal action by the trade unions.

Overall, the Government has taken care in their view to ensure that the fee rates do not impede access to justice and/or disproportionately impact individuals from minority groups in the way the former scheme was found to do. A drop in cases would be expected, and the Government’s consultation paper notes that a 20% reduction in the volume of cases has been factored into calculations and considerations. How this squares with the assertion that the fee is not a deterrent to claims is not explained.

There is also the overriding hope that even the presence of modest fees could incentivise parties, claimants in particular, to engage with Acas to try and conciliate and settle claims without the need to go to Tribunal at all.

There’s a strong likelihood that claimants who feel strongly enough about their claims will pursue legal action whether there is a nominal fee or not (particularly if they view it as a price worth paying for an award of compensation). What’s also clear is that any potential reduction in claims and costly litigation is a bonus for employers, in particular for the sore eyes and souls of HR teams on the front line.

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