Employment Tribunal fees will be scrapped

UNISON have won their Supreme Court challenge against the imposition of Employment Tribunal Fees. The Supreme Court website is about a week out of date and at the time of writing the full judgment is not listed however UNISON has issued a press release.

The introduction of fees, four years ago, is one factor that has contributed to rising claims costs for legal expenses insurers; however the potential costs savings to be realised following the scrapping of fees will be tempered by a potential increase in the volume of claims. UNISON’s victory will not be welcomed by businesses whose vulnerability to be claimed against will return.

We don’t yet know whether fees will be refunded automatically or whether, in the future, it will be possible to charge a lower fee.

UNISON makes a valid point when it says, “We’ll never know how many people missed out because they couldn’t afford the expense of fees. But at last this tax on justice has been lifted.”

ARAG policyholders will not be in the unknown pool of individuals who were deterred from pursing their employment dispute as their decision to take out Family Legal Solutions has given them protection against the unfair fees. Business policyholders who settle fees or are ordered to pay them have also been covered.     

ACAS’s 2016-17 report shows that around 1800 requests for early conciliation are received each week on average. Just below 50% of cases settle through ACAS early mediation and avoid being escalated to a hearing. ARAG policyholders have the reassurance of legal representation throughout early conciliation and beyond.

In relation to employment disputes, the fees have enabled the Government to save around one-third of the costs needed to run employment tribunals. Since introducing fees for employment claims other tribunal jurisdictions have introduced a fee system. For example, low fees of £100 for an application/ £200 for a hearing are payable for claimants seeking dispute resolution through the Property Chamber of the First Tier Tribunal. This level of fee seems much fairer and it’s possible the employment tribunals could adopt something similar.

Aside from charging fees in tribunals, did you know that last year HM Courts & Tribunal Services turned a profit of £100m through the imposition of “enhanced court fees”?  Enhanced court fees apply where court fees are set at a level that exceeds the state’s cost of running a case. This in effect turns courts into profit centres.  We deal with a number of landlord repossession claims and the last hike in fees increased court fees for landlords by 20%.  As tribunal fees have been judged to be unfair surely these enhanced fees are also unfair? 

ARAG’s vision is that all citizens should be able to afford to assert their legal rights and we exist to protect consumers, landlords and businesses against incurring heavy expenses to make or defend a claim. While the abolition of employment tribunal fees is welcome news for employees we will keep a close eye on the impact the decision might have on our business policyholders and we remain concerned at the high cost of bringing other types of claim. 

Is access to justice really out of reach for most employees?

The Guardian’s article “Access to justice is no longer a worker’s right but a luxury” provides an illustration of the difficulties faced by one individual who faced discrimination at work.

https://www.theguardian.com/commentisfree/2017/mar/28/employment-tribunals-workers-rights

On the face of it the lady concerned did not appear to be very well off but she was unable to obtain help with employment tribunal fees and in the event relied on her trade union together with crowd-funding to cover her legal costs and the tribunal fees.  Her case was settled and she was spared attending a hearing. 

We have blogged about the introduction of employment tribunal fees from time to time and this story serves as a reminder of the need for legal protection for individuals. BTE is more valuable than ever since the introduction of fees.

Following its review of employment tribunal fees the Government has confirmed that they have no intention of reducing the level of fees payable (£1200 for most claims that result in a hearing).

The story, however, does not paint the full picture.  It gives the impression that employment tribunal cases are scarce as fees deter individuals from pursuing their rights. While it’s true that claims against businesses have dropped since the introduction of fees the latest quarterly statistics – Q4 2016, show a 3% increase in the number of single tribunal applications received over the same quarter in 2015.

More importantly around 92,000 notifications of disputes were received by ACAS’s early resolution service in the year to March 2016.  The early conciliation service is free to both employers and employees and ARAG provides legal representation throughout the process for our commercial and family policyholders.  Parties are successful in arriving at an agreement through ACAS Early Conciliation in around one-third of cases and can avoid their claim escalating to tribunal.

The consequences of relying on unqualified representation.

Here's an example of why it's so important for customers to have Family Legal Protection.

In Sterling v United Learning Trust the Employment Appeal Tribunal (EAT) agreed that an employment tribunal had been right to reject a claim that did not have the correct early conciliation number recorded on it. This case should serve as a reminder of the consequences that can follow when individuals do not have access to qualified lawyers.

The employee was represented by an unqualified person. Four days before the deadline for making the claim the tribunal inferred that her employment tribunal claim form (ET1 form) was missing some digits from the EC number. The form was returned to her by the tribunal office two days later, with an accompanying letter. The address cited by the office was neither that of her representative nor her home. It ultimately arrived at a neighbour's house and the employee re-submitted straight away, albeit out of time.

The employee appealed against the rejection however the EAT determined that Employment Tribunal rules oblige the employment tribunal to reject a claim if the EC number is missing, although a party may apply for a reconsideration of such a rejection. In this case the employee's representative did not apply for reconsideration, and even though he was not legally qualified the EAT said the employment tribunal was entitled to conclude that no such application was forthcoming.

The representative also failed to argue that it was not reasonably practicable for the employee to have lodged the claim in time. The EAT dismissed the employee's challenge to this aspect of the judgement, making it clear that the burden was on her to prove that it was not reasonably practicable and that even if the point had not been argued originally there was a duty on the employee to ensure that the EC number was cited correctly.