Fees for employment tribunal claims have been ruled unlawful – what does this mean for those pursuing claims against their employers?

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Since 2013 those issuing claims in the Employment Tribunal were required to pay an issue fee, unless they qualified for remission and, a further fee payable before the actual hearing.

Failure to pay these fees led to claims being rejected or dismissed.

Unsurprisingly, the introduction of fees led to a significant reduction in the number of claims being brought – a decline of about 70 per cent. The evidence showed that individuals were being put off from bringing claims, particularly in cases where the monetary value of the claim was limited or where the claimant was seeking a non-financial remedy.

The trade union, Unison, challenged the government’s decision to introduce fees. The basis of its challenge included that the fees regime limited access to justice and indirectly discriminated against women. The discrimination challenge was based on the fact that higher fees were payable for discrimination claims. This put women at a particular disadvantage, given that a higher proportion of women brought such claims.

On 26 July 2017 in the case of R (on the application of Unison) v Lord Chancellor [2017], the Supreme Court ruled that the government had acted unlawfully and unconstitutionally in introducing fees.

As a result, fees were abolished overnight. However, whilst of immense significance, the ruling has left a number of unanswered question for those pursuing claims in the Employment Tribunal.

Can I get a refund?

The government will now have to refund fees paid since 2013. However, the details of how this will work are yet to be announced. It is estimated that the government will owe up to £32m.

Can I issue a claim if my claim was originally rejected for non-payment of fees?

Those who had their claims rejected may now have the opportunity to resurrect those claims.

In the recent case of Dhami v Tesco Stores Limited, the Employment Tribunal exercised its discretion to extend time to allow Ms Dhami’s discrimination claim to proceed.

Initially, her claim her been presented in time but was rejected due to the failure to pay the fee. After the Supreme Court’s decision that the fees regime was unlawful, Ms Dhami filed her claim again arguing that it was just and equitable to extend time and allow her claim to proceed, even though it was presented outside the time limits. (Employment Tribunal claims need to be made three months, less one day, from when the date the discrimination happened.)

Resubmitting the claim is one option but it’s advisable to seek legal advice as there are a number of options in this regard. Including, applying to the Tribunal and seeking confirmation that the claim is now accepted.

What about those who were dissuaded from pursuing a claim because of fees, can they now issue their claim even though the time limit has expired?

As yet it’s unclear whether the government will introduce a system to deal with potential claimants who were dissuaded from bringing a claim.

It looks unlikely that they will. One possibility is to submit a claim in the normal way and apply for an extension of time based on the usual tests. Which are, that it was “not reasonably practicable” (applicable in unfair dismissal claims, for example) to bring the claim within the time limit and that is it “just and equitable” test (applicable in discrimination claims) for the tribunal to extend time.

Under the “not reasonably practicable” test, the tribunal is required consider whether the claim was presented in a reasonable timeframe following the expiry of the primary time limit. Under the “just and equitable” test, promptness of action is a factor that the tribunal takes into account. In view of this, those who now want to bring out-of-time claims should act promptly.

This is subject to any scheme being announced by the government to deal with such claims.

No more fees – for now…

The abolition of fees is likely to lead to an increase in tribunal claims. It’s also likely to impact the way cases are defended by employer. Employers will be more likely to settle cases at the pre-tribunal stage given that employees no longer have to incur a fee to issue a claim.

In my experience, the introduction of fees had led to a culture where settlement discussions became unnecessarily protracted, with employers failing to engage in meaningful settlement discussions until a claim had been issued. So, while this is good news for claimants, don’t get carried away. Just because the Government has abolished these fees, readers should not assume that pursuing a claim through the Employment Tribunal will remain fee free. It is possible that the government may introduce a replacement fees regime.

The Supreme Court’s decision was not a determination of the legitimacy of court fees in general. It was an analysis of the lawfulness of the particular fees regime introduced in 2013. So, while there might be no fees for now, it is likely the Government will keep this under review.

About the author

Homa Wilson is a senior associate in the employment team at London law firm, Hodge Jones & Allen.

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