In 2013 the government introduced for the first time fees for a claimant to pay in order to bring a claim in an Employment Tribunal. There are two categories of fees:-
1. Type A claims: Issue fee of £160 with a further hearing fee of £230, which totals £390.
2. Type B claims: Issue fee of £250 with a further hearing fee of £950, which totals £1,200.
Many claimants, particularly those who have lost their jobs, have found the payment of these fees to be a significant disincentive to take legal action against their former employer. The statistics show that the number of claims reaching Tribunals has declined by, at least, 70%.
There have been other influences that have reduced the number of claims going to Employment Tribunals. One of those being the ACAS pre-conciliation scheme which is a mandatory step that potential claimants now have to follow before a claim can be lodged in the Employment Tribunal. This scheme gives an opportunity for the parties to agree to a negotiated settlement of the claim conciliated by an ACAS official.
We also believe that a further reason for the decline of Employment Tribunal claims is the wider use by employers of Settlement Agreements which can be used to end an employment relationship subject to a payment to the employee and the employee receiving independent legal advice.
The question of the drop of Employment Tribunal claims has been recently investigated by the Justice Committee of the House of Commons. They heard evidence from a number of different parties on both sides of industry and they found the introduction of issue and hearing fees in the Employment Tribunal had lead to an undisputed and precipitated drop in the numbers of cases brought. The committee concluded that the introduction of fees has had an unacceptable impact on access to justice for meritorious claims. It also said that the existence of fees was a disincentive for employers to resolve disputes at an early stage.
The committee recommended that:-
• The level of fees charged for bringing cases to the Employment Tribunal should be reduced
• The Type A and Type B claims should be replaced by a single three-tier fee structure proportionate to the amount claimed
• The fee should be waived if the amount claimed is below a determined level
The committee recommended that fee remission thresholds should be increased which would enable people who are on benefits or have no savings and/or low income should have their fee waived more liberally.
If you would like to discuss any employment law issues, please contact our Employment Law specialist team.
Author: Gareth Price, Email: