Essential information for employees following the removal of Employment Tribunal fees
With the recent news that the Supreme Court ruled Employment Tribunal fees were unlawful and abolished with immediate effect, Blanchards Bailey has put together a double feature special - including essential information for employees and details of how this radical change will impact employers.
Here we look at essential information for employees – including rights to pursue employers for compensation, the viability of lower case claims (e.g. claiming notice pay and unpaid annual leave) and recovering Employment Tribunal fees already paid.
If you are an employer and looking for advice, please read our separate article here.
Background - the end of Employment Tribunal fees and why they were quashed
On 26th July 2017, the Supreme Court ruled that Employment Tribunal fees were unlawful. The rationale behind this decision was that the fees prevent access to justice in that they deter people from asserting their statutory rights.
As a result of the judgment, the government has announced that it will immediately stop charging Employment Tribunal fees and reimburse those fees that have been paid in the past. It is estimated that the government will need to reimburse up to £32 million worth of fees as a result of this judgment.
Employment Tribunal fees were first introduced in July 2013 by the coalition government. The intention behind the fees was to reduce malicious or weak claims brought by individuals against their employers. The introduction of fees led to a reduction in the amount of claims brought by around 70%. However, the percentage of unsuccessful claims rose following the introduction of fees, which the Supreme Court believed showed that the measures had simply reduced the number of Employment Tribunal claims without reducing the percentage of unmeritorious claims.
What does this mean for employees?
The immediate removal of Employment Tribunal fees means that it is now more financially viable for individuals to bring a claim. Fees of up to £1,200 previously put people off from asserting their rights in the Employment Tribunal, even if they had very strong claims. Now that this barrier has been removed, many people will consider that it is worth pursuing their employers for compensation, particularly in cases where they are out of work and would not have previously had the means to raise the money to pay the fees.
The decision also means that it is more viable to bring lower value claims, such as those for notice pay and unpaid annual leave. In the past, many unscrupulous employers have avoided paying notice pay or accrued annual leave to departing employees because they knew that the fees payable to claim those sums would often be more than, or a high percentage of, the amount that person was seeking to claim. This would often mean that seeking to recover those sums was more trouble than it was worth.
Those individuals who have been unsuccessful in their Employment Tribunal claims, or have settled those claims without recovering the Employment Tribunal fees they paid, can now claim the fees back. The government has not yet announced how it will reimburse those individuals or when it will announce the process for claiming refunds but is expected to do so soon. If you would like advice on how to go about reclaiming Employment Tribunal fees that you have paid, please get in touch with our employment team.
If you currently have a potential Employment Tribunal claim and are considering whether or not to pursue it, it would be advisable to do so sooner rather than later. There is a time limit of three months less one day to contact ACAS to commence the early conciliation procedure and so claims are time limited anyway, but there is the possibility that the government may try and introduce new Employment Tribunal fees in light of the Supreme Court’s decision. In order for these fees to be lawful, they will need to be significantly lower than the previous fees in order to avoid preventing access of justice. In addition, it is unclear how willing parliament would be to authorise such legislation, but it does remain a possibility. In order to avoid the possibility of having to pay Employment Tribunal fees in future, individuals are encouraged to commence claims as soon as possible whilst no fees are in place.
If you are an employee with a potential Employment Tribunal Claim and you would like further advice, please contact our employment law team on 01258 483601.