Employment tribunal fees (at last!) ruled ‘out of order’

Older worker

The 26 July 2017 should go down in legal history. It should be remembered as the day the Supreme Court shocked everyone  by ruling that the Government’s regime of fees in the Employment Tribunal (ET) system was, in fact, illegal.

Age UK has long opposed the fees, believing they are unfair and unsustainable – if employers know they can get away with treating workers illegally, then statutory employment rights aren’t worth the paper they’re written on. The laws on age (and other) discrimination that we all fought hard for would be completely undermined.

So we’re delighted by the ruling, and hope it helps a great many people attain justice. It’s plain wrong to price people out.

It’s also worth mentioning upfront that the case was brought by the trade union Unison, which has spent years taking it through the legal system, suffering defeat after defeat – until now! – without whom it would never have happened.

Denying access to justice

It is extremely important that everyone can seek redress when they are treated illegally. Not only does this support the individual claimant, but it also ensures that good employers who honour the spirit of the legislation are not undermined by those who don’t. In this case, it was clear – judging by the huge reduction in claims received by the ETs – that fees had either prevented or discouraged large numbers of people from accessing justice.

Age discrimination claims received by the ETs had typically numbered around 900 to1,200 each quarter, prior to fees being introduced. Afterwards, this fell to roughly 200 to 500 per quarter – more than halving  the claims made.

To be fair, at the same time as the introduction of fees a new ACAS ‘early conciliation’ system came in, which did encourage people to settle, but the impact of this has been unclear to date. There was also a fee remission system allowing people on benefits to make claims for free, but many people who were still working and on a low income did not qualify. A more detailed view on the fees, stats and ACAS relationship is available on this blog site.

Low earners having to stump up cash

The Supreme Court was very interested in the fact that even lower earners have to stump up cash, often to win back a tiny amount of money. These claims (known as Type A) cost £160 upfront and then a further £230 to go to a hearing. In many cases people could be trying to get their hands on unpaid wages totalling a fraction of the fees, making it a highly punitive system – especially when employers don’t always pay up after losing.

Type B claims, including discrimination and unfair dismissal (costing £250 initially and £950 for the hearing) are clearly even harder to find the money for. In addition, the ruling explains that higher fees to deter “discrimination claims is thus in itself discrimination against the people, by definition people with protected characteristics, who bring them (para. 132). The fees are not legal for this reason either – effectively double discrimination!

Interestingly there was also a lot of consideration of the Joseph Rowntree Foundation’s Minimum Income Standard measure. The Government had argued that people could cut back on some expenditure in order to save enough for their ET fee. However, after a careful scrutiny of the JRF figures, the Court decided:

“Where households on low to middle incomes can only afford fees by sacrificing the ordinary and reasonable expenditure required to maintain what would generally be regarded as an acceptable standard of living, the fees cannot be regarded as affordable.” (para 93)

Rooted in common sense.

The constitution at its core

At heart, this judgement is about reconciling three important parts of the British constitution – the ‘rule of law’ (the judiciary), Parliament, and the executive branch of Government.

The Court effectively ruled that the way the Government had gone about setting up the regime was unconstitutional. Because the Government had used a Statutory Instrument – secondary legislation that doesn’t need full Parliamentary approval – and the fees were set at an arbitrary level, the will of Parliament had been over-ridden by the Government.

Coupled with the mass-denial of access to justice, which the ruling points out is a key principle of the Magna Carta, the Charter of Fundamental Rights, and EU law, this led to the (seemingly) inevitable conclusion that the current fee regime is not legal.

What next?

The Government still holds the principle that users of the Tribunal ‘service’ should pay some of the costs – although the Court was very clear that they are not service users in the usual sense . So it’s probable that they’ll go back to the drawing board and start again. We hope, however, that if they do try again, then they’ll account for all the unfairness that charging people creates in the ‘real’ world.

Ultimately it’s about the constitution, the fundamental right of access to justice, and – perhaps just as importantly – the financial reality of regular low and middle income people making ET claims.  The Court has proven that on this topic, at least, it is very much in touch with reality.

You can find free information and advice on the Age UK website on your employment rights, information to help you find a new job or retrain, and how to improve your digital skills. 

 

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