Fees for employment tribunals begin
29th July 2013
People bringing employment tribunals must now pay a fee for the first time since they were created in the 1960s.
Under the new UK rules, they will have to pay £160 or £250 to lodge a claim, with a further charge of either £230 or £950 if the case goes ahead.
The higher charges will cover cases like unfair dismissal, the lower ones issues such as unpaid invoices.
Employers welcomed the fees as a way of “weeding out” weak claims, but one union said the move was “draconian”.
The Unite union said the measures would make British workers “some of the worst protected in the EU”.
Another union, the GMB, will stage a protest outside an employment tribunal in central London later.
Those claimants unable to pay may apply to have the tribunal fees reduced or waived.
Justice Minister Helen Grant said: “It is not fair on the taxpayer to foot the entire £74m bill for people to escalate workplace disputes to a tribunal.
“We want people, where they can afford to do so, to pay a contribution.
“It is in everyone’s interest to avoid drawn out disputes which emotionally damage workers and financially damage businesses. That’s why we are encouraging quicker, simpler and cheaper alternatives like mediation.”
In the Employment Appeal Tribunal, the fees are £400 to lodge an appeal and another £1,200 for a full hearing.
Costs are reduced in instances of multiple claims, where two or more people bring claims against the same employer.
Employers’ organisation the CBI welcomed the fees, saying they were a good way of “weeding out weak claims”.
“Fear of the costs of fighting a tribunal – even when you are in the right – is a massive confidence killer. With firms and employees waiting over a year for a tribunal at the moment, something has to be done to speed things up,” the CBI added.
A legal challenge to the introduction of fees has been made, and HM Courts and Tribunals Service said it would refund people if the bid was successful.
‘Throwback to Victorian times’
The number of tribunal claims rose by 81% between 2001 and 2011, with the administrative costs being borne by taxpayers up until now.
Chancellor George Osborne announced the plans in 2011. “We are ending the one-way bet against small businesses,” he said at the time.
A spokesman for the Federation of Small Businesses said: “For an employee, an employment tribunal can be seen as a ‘no cost’ option.”
“The FSB hopes the introduction of fees will curb the number of speculative claims and help reduce the perceived risk of taking on staff.”
Unite estimated that this would affect 150,000 workers a year and pledged to pay the employment tribunal costs of its members.
“What we are seeing today is injustice writ large as this worker-bashing government takes a sledgehammer to workers’ rights – this is a throwback to Victorian times,” Unite general secretary Len McCluskey said.
“Seeking redress for unfair dismissal and discrimination and other injustices in the workplace is a fundamental human right – but now ministers are putting up insurmountable financial hurdles for working people in pursuit of justice.”
Andy Prendergast of the GMB, said: “The imposition of such fees represents the latest in a number of attacks on employment rights by the government.
“Bad employers are being given the green light to continue exploiting their staff.”
Some in Scotland welcomed the move. Eilidh Wiseman, a partner at law firm Dundas and Wilson, said: “I believe anything which helps reduce frivolous claims and speeds up the tribunal system will be welcomed by employers
“One of the effects of the new system should be a rise in the value of settlement offers for low-value claims. Offering £500 as an economic offer to settle is not likely to be attractive to a claimant who has paid £1,200 to bring a claim.”
There were 186,300 claims accepted by employment tribunals in the year to March 2012, according to the Ministry of Justice. Of those, 31% were for unfair dismissal, breach of contract and redundancy.
Twenty-seven percent of the 186,300 claims were withdrawn – but employers in those cases still had to pay legal fees in preparing a defence.
In 2011-12, the Employment Appeal Tribunal received 2,170 appeals.