The end of Employment Tribunal fees

As we recently reported, the Supreme Court (SC) has ruled that the charging of fees by the Employment Tribunal (ET) and the Employment Appeal Tribunal (EAT) since 2013 was unlawful. This decision has led to the ET and the EAT immediately ceasing to charge any fees. However, a number of important questions remain. Firstly, what will happen to the level of claims? Given that the estimates for the reduction in claims following the introduction of fees range from 70-80% it would seem inevitable that the number of claims will increase. Whilst the Acas Early Conciliation process has led to many claims being settled it does seem as though the cessation of fees will lead to an increase in claims.

The second issue is how the fees, which were unlawfully charged, will be repaid? In most cases, where the Claimant was successful, the employer will have been obliged to pay the fee paid by the Claimant to bring the claim. However, the amount of the fees would have been paid to the Claimant by the employer and not to the ET. So, will the ET refund the fees to the Claimant, with the employer then seeking repayment from the Claimant? Only time will tell, but it would appear likely that the repayment of fees will be complicated and costly. Fortunately, for the vast majority of our clients, the recovery of ET fees is not an issue.

The third issue is whether or not potential claimants from 2013-2017 can now argue that they were deterred from bringing a claim by the fees regime and that they should now have an opportunity to have a go. This is unlikely to be a major issue (although it certainly cannot be ruled out) as the tests for extending time to bring claims to the ET are quite strict and it will therefore be difficult, but not impossible, for the majority of such claimants to get their cases off the ground.

The final issue is how the Government will respond to the somewhat humiliating decision by the SC? It has been suggested that the Government will seek to introduce a new fees regime with reduced rates. However, this is unlikely for two reasons. Firstly, why would any level of fees not be vulnerable to a similar challenge in the Courts? Secondly, the current Government does not have a majority and it is hard to see how any legislation to re-introduce Tribunal fees will get through Parliament any time soon. The Government also has more pressing matters to consider, not least steering the UK’s path out of the EU.

In summary, it seems likely that there will be no fees to bring ET claims for the foreseeable future but what the effect of this will be on employers in terms of increased claims is uncertain. It is hard to see how there will not be some increase in claims but whether the level of claims will return to the pre-2013 levels and if so, how quickly, remains to be seen.