In breaking news it has been confirmed that the Supreme Court have held that Employment Tribunal Fees are unlawful. What will this mean for employers?
Employment Tribunal Fees were introduced in July 2013. Until that point Employment Tribunals had been free to claimants. The introduction of fees was welcomed by many employers throughout the UK who believed the fees would deter potentially spurious claims. Following the introduction of the fees the number of tribunal claims significantly reduced by approximately 70%. While many employers applauded the introduction of the fees, many others believed the fees were a barrier to employees accessing justice. This lead to the Trade Union, Unison challenging their introduction in court. Initial rulings decided there was insufficient evidence to directly support that the fees were preventing individuals from accessing justice. However, as the statistics relating to the reduction in the number of tribunal claims have continued to mount, Unison have continued their battle. They have received their judgement from the Supreme Court agreeing with them that the fees have been a barrier to employees accessing justice. The fees have therefore been deemed unlawful.
What does this mean?
The decision of the Supreme Court is binding on all lower courts and tribunals. The Employment Tribunal Service will need to take action to remove the requirement to pay fees. The decision also stipulated that the fees paid to date should be reimbursed to employees.
Is there any further action the Government can take to overturn this decision?
The Supreme Court is the end of the road as far appeals go. However, it is important to note what the Supreme Court did not say. It did not say that all forms of fees are unlawful. Interestingly the court compared the Employment Tribunal fees to the fees imposed in the Small Claims Court, which are considerably lower than the Employment Tribunal Fees. It may therefore be fair to say that rather than abolish fees entirely the Government could try to reduce the fees. Given the comparison adopted by the Supreme Court, perhaps the Government will look to model a future fee structure based on that of the Small Claims Court instead.
As for employers, what does this mean for the way they are to deal with employment matters? While it is always advisable to follow best practice in all HR issues, with the potential for tribunal claims to rise again, it may be that employers will be more risk averse when it comes to making commercial employment decisions.