Background: The Rise and Fall of Tribunal Fees
In 2013, fees were introduced as a means to mitigate the costs borne by the taxpayer in administering the tribunal services. However, due to a sharp decrease in the number of cases brought to tribunals and widespread criticism of the high fees, the government decided to eliminate the charges in 2017. Since then, it has been free to bring a claim to the ET and EAT.
Introduction:
As of January 29, 2024, the Ministry of Justice has initiated a public consultation to gather opinions on the reintroduction of fees for bringing claims to Employment Tribunals (ET) and Employment Appeal Tribunals (EAT). This move follows the abolishment of fees in 2017, which was prompted by a substantial decline in tribunal cases and concerns over the perceived high costs of initiating claims. In this blog post, we will delve into the key points outlined in the proposal and examine the rationale behind this significant development.
The Role of Employment Tribunals:
Employment Tribunals play a crucial role in providing a simple and accessible forum for resolving disputes arising in the workplace. With jurisdiction over 70 different types of claims, these tribunals offer just and certain solutions to employment-related conflicts. Lessons learnt from past experiences, particularly the UNISON judgement, have prompted a reassessment of the fee structure to ensure affordability, proportionality, and simplicity.
Current Arrangements and Challenges:
Currently, there are no fees for bringing employment claims or appealing decisions in the ET and EAT. The entire cost of administering these tribunals falls on the taxpayer, amounting to around £80 million in 2022/23. With an increasing caseload of approximately 33,000 cases and 85,000 claims, there is a need for additional resources to ensure the efficient functioning of the tribunal services.
Rationale Behind Tribunal Fees:
The proposal to introduce fees in the ET and EAT is rooted in the idea of relieving some of the costs burden on the general taxpayer. Modest fees may also serve as an incentive for parties to settle disputes early through the Advisory, Conciliation and Arbitration Service (ACAS), reducing the strain on the tribunals.
Details of the Proposed Fees:
- Claim Issue Fee – Employment Tribunals (ET):
- A £55 issue fee payable by the claimant on bringing a claim to the ET.
- The fee remains fixed at £55, even for multiple claimants, with the cost potentially divided among them.
- Appeal Fee – Employment Appeal Tribunal (EAT):
- A £55 fee payable by the appellant upon lodging an appeal in the EAT.
- The fee is applied per judgement, decision, direction, or order being appealed.
Exemptions and Considerations:
Certain proceedings in the ET related to establishing a right to payment from the National Insurance Fund are exempt from fees. This includes cases where the employer is insolvent, and claimants are seeking payments covered by the statutory scheme.
Impact of the Changes:
The proposed fees are estimated to generate £1.3 million to £1.7 million per year from 2025/26 onwards. While the intention is not to impact demand, the income estimates consider potential changes in application volumes and fee remissions.
Consultation Period:
The public consultation on this proposal is open for eight weeks, from January 29, 2024, to March 25, 2024. Responses are invited from various stakeholders, including employers, employees, trade unions, employer organisations, representatives, and other interested parties in Great Britain.
Conclusion:
The proposed introduction of fees in Employment Tribunals and the Employment Appeal Tribunal reflects a nuanced approach to balance financial considerations with access to justice. As stakeholders engage in the consultation process, the outcomes will likely shape the future landscape of dispute resolution in the employment sector. Stay tuned for further developments on this significant matter.