John Livesey is Head of the Employment Team at Albion Chambers in Bristol, which comprises 12 barristers. He has 20 years experience as an employment lawyer and sits part time as an Employment Judge in Reading.
In December, the government launched a consultation on introducing fees in employment tribunal claims. We asked John what impact such changes would be likely to have on the tribunal system and the litigants who currently use it free of charge.
There are two proposals for charging fees which have gone out for consultation. In option one, the claimant will pay an initial fee to present a claim (the amount paid dependent on the type of claim brought), with an additional fee payable if the claim goes to a hearing. Under this option, there is no limit to the maximum award that a tribunal may make in the claim itself. For multiple claims (those with more than one claimant against the same respondent), a different fee will be charged.
In the second option, the claimant will pay a single fee of £200-£600 at the point of presenting the claim, with the maximum award limited to £30,000. Claimants seeking a higher award will pay an additional fee of £1,750.
As regards the Employment Appeal Tribunal, there is one proposal for fees; the appellant should pay an initial fee on application and a second fee if the case continues to a hearing.
Q Why should employment tribunals be any different from civil courts which charge fees?
A There are a number of differences between employment tribunals and the civil courts. First, the time limits for bringing a claim to the employment tribunals are dramatically shorter than those of the civil courts. Prospective claimants in the employment tribunal have three months in which to present their claims whereas contractual or tortious claims have a three or six year limitation period. This gives a prospective claimant very little time in which to seek legal advice and to gather the funds to pay any necessary fees, especially when they are likely to have just lost their employment.
Secondly, it is substantially more difficult to assess the value of a claim at an early stage in an employment claim than in a civil case. This is because of the short time period that will have elapsed before a claim is issued, the lack of pre-action disclosure and the inherent uncertainty associated with many employment claims. If a prospective claimant has recently lost their employment, they are unlikely to be able to assess their prospects of obtaining alternative employment with any great degree of certainty. At the issue stage, who can he or she predict a likely future loss award that a tribunal might be prepared to make several months hence?
Thirdly, it is argued that one of the more important functions of the employment tribunals is to ensure that certain legal obligations are complied with by employers. Those obligations may not, if breached, necessarily give rise to claims of significant value, but the civil courts do not enforce them in a same way or at all and there are significant policy considerations in allowing what may be low-value claims to proceed in the tribunals to ensure compliance with such legislation. Examples include the exercise of flexible working or health and safety rights.
Q What level are fees likely to be set at?
A In option one, the initial fee and hearing fee are suggested to be as follows:
|Fee||Initially payable by||Amounts|
|Issue fee||Claimant||Level 1 – £150 (sums due on termination; e.g. notice pay, wages and redundancy)
Level 2 – £200 (unfair dismissal)
Level 3 – £250 (all discrimination, equal pay and whistle-blowing)
|Hearing fee||Claimant||Level 1 – £250
Level 2 – £1000
Level 3 – £1250
For specific applications, the following table applies:
|Fee||Initially payable by||Amounts|
|Request for written reasons||Party who applies||Level 1 – £100
Level 2 – £250
Level 3 – £250
|Review application||Party who applies||Level 1 – £100
Level 2 – £350
Level 3 – £350
|Dismissal of case after settlement or withdrawal||Respondent||£60|
|Set aside default judgment||Respondent||£100|
|Mediation by judiciary||Respondent||£750|
In option two, where the fees are set by the type of claim and its value, the fees for a single claimant are as follows:
|Issue fee||Initially payable by||Amounts|
|Level 1 claims (up to an award of £29,999.99)||Claimant||£200|
|Level 2 claims (up to an award of £29,999.99)||Claimant||£500|
|Level 3 claims (up to an award of £29,999.99)||Claimant||£600|
|Level 4 claims – Any type of claims where the award sought is unlimited||Claimant||£1750|
For the EAT, the proposed fees are:
|Fee||Initially payable by||Amounts|
These fees are subject to fee remission from HMCTS, similar to the county court system, if the claimant’s income falls below a certain level or is entitled to certain benefits.
Q Are they recoverable?
A Currently, costs are only awarded if a party to tribunal litigation has behaved “unreasonably”, or in certain other similar circumstances. In both proposed options, the employment tribunals will have the power to order that the unsuccessful party should reimburse the fees paid by the successful party.
It may be difficult, in practice, to ascertain who has been a successful party in a claim; what if a claimant’s unfair dismissal claim succeeded but a large degree of contributory conduct was found against him? What if a discrimination claim failed, but an unfair dismissal element succeeded? There is also a doubt as to the situation that would face a respondent where the claimant was eligible for a remission and therefore did not pay any fee. It has not been suggested whether the respondent would then have to pay the fee owed to the HMCTS.
Q What is the most likely outcome?
A It seems evident that fees will be introduced into the employment tribunals system; the only real doubt, it seems, is in what form and at what level the fees will be set.
There are advantages and disadvantages to both options. Those who have responded to the consultation have been split in their views, ACAS providing a neutral contribution; they do not mind, as long as their part in the process is not affected. The aim is to balance the benefits of discouraging meritless claims with the need to ensure access to justice for all persons. Furthermore, there is a need to maximise the funds available to the tribunals by making the administration of the fee system as effective and efficient as possible, but it is clearly unrealistic to expect to cover all of the costs of the employment tribunals system through the charging of fees, as this would impose an extremely high burden on those accessing the system.
It should be remembered that the tribunal system was established to provide a swift, effective, accessible and cheap way of settling workplace disputes. Although it is unclear what the outcome of the consultation will be, given the variety of views expressed by those who responded and the political demands placed on the Ministry of Justice, these fundamental aims of the system should not be neglected.
John can be contacted at: John.email@example.com. For further information about the employment team at Albion Chambers please visit: www.albionchambers.co.uk or telephone our clerks on 0117 927 2144.