Employment tribunal fees: UNISON challenge fails

The challenge brought by UNISON to the introduction of tribunal fees has failed… for now. The case was heard at the High Court and UNISON has indicated that they intend to appeal to the Court of Appeal.

The issue

An “issue fee” is payable when a claim is issued in the employment tribunal and a “hearing fee” is payable before the case is heard. Claims are split into simpler “Type A” claims and more complex “Type B” claims. The issue fee for single claimant Type A claims is £160 and the hearing fee is £230. The fees for single claimant Type B claims are £250 on issue and £950 for the hearing.

The challenge

The challenge by UNISON to the fees regime was brought on four grounds:

1. Procedural requirements must not make it virtually impossible or excessively difficult to exercise rights conferred by EU law. Many employment rights, particularly discrimination, derive from EU law. UNISON argued that the existence of fees make it excessively difficult to exercise these EU derived rights.

UNISON introduced hotly disputed figures as to the dramatic fall in employment claims as evidence that the new rules prevented access to justice. They also referenced various types of claimant and sought to demonstrate how they could not afford to access the tribunal system. After some analysis, the Court concluded that the existence of a remission system and timing of the fees meant that although proceedings would be expensive, it was not convinced that it would be virtually impossible or excessively difficult to bring a claim.

However, the Court’s main conclusion was that it was simply too early to know for sure whether this was the case. They proposed adopting a “wait and see” approach and commented that if actual evidence arose that UNISON’s case was correct, the Court expected the government to change the system without the need for further litigation.

2. Domestic rules governing the exercise of rights derived from EU law must not be less favourable than those governing similar rights which are not derived from EU law. Many more employment rights derive from EU legislation than rights exercised in the County and High Courts. UNISON argued that when compared to the costs of small claims brought in the County Court, the level at which fees are set for employment tribunals are less favourable and therefore unlawful.

The Court felt that the most appropriate comparison with employment tribunal claims was actually fast track County Court claims, not small track claims and concluded that the employment fees systems was overall not less favourable because:

  • Tribunal fees were not incomparable with fast track County Court fees.
  • The risk of an adverse cost award could put claimants off issuing a claim in the County Court, whereas costs awards are rarely granted in employment tribunals.
  • Successful employees can expect to recover the fees they have incurred from the employer.
  • There will be a free alternative dispute resolution service from April 2014 in the employment tribunal, which is not available in the County Court.

3. The Public Sector Equality Duty requires those making laws to have due regard for the need to eliminate discrimination. UNISON argued that this duty was not complied with. 

The Court gave little weight to this argument. They listed seven different types of consultant and assessment which the government had undertaken with regard to the impact of the fees, including a pre-consultation equality impact assessment, public consultation on different fee-charging structures, numerous events, detailed analysis and response to the consultation and publication of a number of impact assessments.

The Court further commented that Unison had utilised every opportunity to advance every possible ground on which the introduction of a system of the imposition of fees could be challenged and commented “It cannot therefore be said that the Ministry disregarded those points merely because it dismissed them….”

4. It is unlawful to have a provision which puts people sharing a particular characteristic at a disadvantage, subject to the possibility of objectively justifying that provision. UNISON argued that as discrimination claims are classified as the more expensive Type B claim, that having a higher rate of fees in these cases has a higher impact on minority groups, such as women, ethnic minorities and the disabled and was unlawful.

The Court found that women and those from other protected groups are more likely to bring claims which attract the higher Type B level of fees. However, when considering whether the fees regime could be justified, the Court found that it was not yet possible to assess the extent of the impact. For that reason, the Court, felt unable to reach a conclusion as to objective justification and did not allow the claim to succeed.

The dismissal of UNISON’s challenge is not the end of the story. The Court was clear that if evidence arises to show that access to justice is being curtailed, or that the impact on certain groups cannot be justified, then the government must reassess the fees regime, potentially without the need for further litigation. Grayling as Lord Chancellor has won the first battle on tribunal fees, but may be in danger of losing the war.

For more information contact Mark Hammerton, Head of Employment

This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information.