The 26th July 2017 was a momentous day for employment law: the Supreme Court decided, in a landmark case brought by Unison, that Employment Tribunals fees in England and Scotland were unlawful. While it’s still early days, and a lot is still to be determined, here’s our summary of the implications:
1.What is the immediate impact of the ruling for employers?
Undoubtedly, the ruling abolishing Employment Tribunal fees will result in an increase in the number of claims being brought over the coming months. We have received anecdotal reports from local Tribunal centres that in the weeks since the ruling they’ve seen a 10-fold increase in the number of new claims being lodged. Any new claims relying on the Unison judgment are being stayed currently pending further clarification from the Ministry of Justice on the position. It’s important to remember that employers will still have the opportunity to settle any new claims prior to the formal Tribunal process through ACAS early conciliation and, in our experience, this is a very worthwhile exercise for employers.
2. Can individuals and employers be reimbursed for Employment Tribunal fees they’ve paid in the past, and what’s the process for doing so?
The Government has said that it will put in place a system to reimburse anyone who has had to pay Employment Tribunal fees (or Employment Appeal Tribunal fees) since they were introduced in July 2013. It is thought that the cost to the Government of reimbursing all fees will be in the region of £30 million. Details of the relevant systems to be put in place are awaited, and are expected to be announced in September 2017. We will report further on that once the position is known. If you are an employer who has reimbursed an Employment Tribunal fee to a claimant under the terms of a settlement agreement, then the contractual terms will apply. So, unless you’ve provided for this situation in the agreement, it is unlikely that the amount paid to the individual under the agreement for the tribunal fees would have to be repaid.
3. Will claimants who have been dissuaded from bringing a claim because of the cost of doing so, now be able to do so?
A central part of Unison’s case was that scores of people had been put off bringing their claims in the Employment Tribunal because of the expense of doing so. This was particularly the case if the claim itself was for a relatively modest amount of money e.g. non-payment of wages or holiday pay. We do not yet know whether the Government will introduce systems to deal with this group of potential claimants. Our advice is that any individuals in this position should submit their claim in the normal way, promptly, and apply for an extension of time to submit their claim outside the normal time limits. This is exactly what one former employee of Tesco, Miss Dhami, did earlier this month and Southampton Employment Tribunal had no hesitation in accepting her claims for age and disability discrimination even though they were submitted out of time. In our view, this is the first of many more cases of this type where the Employment Tribunal will feel compelled to rule in the individual’s favour given the Supreme Court’s ruling.
4. Could Employment Tribunal fees be reintroduced?
In short, yes. We think it is highly likely that a replacement fee regime will be introduced in the future. While the Supreme Court had no difficulty in finding that the old fees regime was unlawful, they did indicate that a different regime (for example one which charged significantly less), might be lawful.
5. How will the abolition of fees affect the Employment Tribunals and administration of cases?
The inevitable surge of new claims is likely to mean that the Tribunals will take longer to deal with applications and correspondence. We also expect Tribunals to be much stricter in the time-tabling of cases, both existing and new claims, to ensure that cases are heard without too much delay. In the longer term, the added strain on resources is likely to strengthen the Government’s resolve to reform the Tribunal system and reintroduce a fairer fees regime.
Employment Tribunal litigation is one of our areas of expertise. If you are contemplating bringing a claim or are engaged in a dispute which may result in Tribunal proceedings and want an expert view, please do not hesitate to get in touch with Tiggy or Emma.