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Supreme Court rules Employment Tribunal fees are unlawful

  • United Kingdom
  • Employment law

26-07-2017

The UK’s most senior court has today quashed the current system of fees for employment tribunal claims on the grounds that it is unlawful, overturning two High Court decisions and one Court of Appeal judgment to the contrary.

The Supreme Court decided that the government acted outside its powers when it introduced fees at current levels, because the fees effectively prevent access to justice and, in addition, they discriminate indirectly against women.

As a result of the judgment no further fees can be charged by HM Courts and Tribunals Service in employment cases unless and until a replacement scheme is introduced. This means new claims can be lodged now without the claimant paying an issue fee and existing claims can proceed to a hearing without the claimant having to pay a hearing fee. Without the deterrent effect of high fees, employers now face an increased risk of employment related claims from workers. It is also possible that some individuals might now try to claim they should be permitted to bring out-of-time claims in respect of past alleged breaches of their rights, arguing that the high fees prevented them from suing in a timely manner.

The government is likely to want to move quickly to put in place a more proportionate replacement fees scheme. What any new scheme will look like remains to be seen but to avoid future challenges, and a bumpy ride in Parliament (which will need to approve any replacement fees order), the government will need to work much harder this time around to justify its decisions. The need for a more careful analysis of the effects of any new proposals means it could be many months before a replacement system of fees is put in place. The volume of claims might then drop once again but not to anywhere near the low levels seen in the last four years.

As for those who have already paid tribunal fees, the Ministry of Justice has undertaken to reimburse fees already paid. What is not yet clear, however, is whether that undertaking extends to compensating employers who have been ordered by tribunals to reimburse fees paid by claimants. 

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