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Vital statistics: the impact of Employment Tribunal fees

17-December-2014 18:05
in Employment
by Hannah Laithwaite

In June 2013, the Chambers of Lawrence Power blogged about the introduction of the two-tier fee system in the Employment Tribunal. The aim of the fee system, which went live in July 2013, was said to be to encourage people to look for alternatives before going to the employment tribunal.

The rules required prospective claimants to pay an issue fee and then, later, a hearing fee. There are two levels of fees with the appropriate level of fee generally being gleaned from the complexity of the case.

Non-payment of the fee would result in the claim form being rejected or the claim being otherwise dismissed.

There is, of course, the remission scheme for certain prospective claimants in receipt of qualifying benefits and on low incomes to avoid paying the fees.

In September 2014, the Ministry of Justice published its quarterly statistics on the number of employment tribunal claims received from April to June 2014 (Q2) compared to the same quarter in 2013, before fees were introduced. The statistics showed that single claims received in Q2 of 2014 were down by 70% from the same quarter in 2013.

Also available are the statistics comparing January to March 2014 (Q1) with the same quarter in 2013 which show single claims received by the tribunal had reduced by 59%.

Finally, between October and December 2013 (Q4) single claims received by the tribunal were down by 79% from Q4 of 2012.

Multiple claims received over the last four quarters (since the change in fees) have declined comparatively from the previous year by two-thirds.

These statistics show a stark reduction in claims being brought following the introduction of the fee regime. This reduction is of course being attributed to the introduction of fees, however, April 2014 also saw the introduction of “Early Conciliation” which made it compulsory for claimants to notify the Advisory, Conciliation and Arbitration Services (ACAS) that they want to bring a claim against their employer so that they can be offered the opportunity to try and settle the dispute without recourse to the tribunal at all. This adds a further procedural layer between a claimant and access to the justice system.

Whether this dramatic reduction is a sign of a denial of justice or a symbol that misuse of the tribunal system has been brought to an end remains to be seen. Our view is that a greater degree of qualitative data and analysis will be needed to address this fundamental question.

The dialogue about the employment tribunal system as a whole is set to become very interesting over the next six months, given Chuka Umanna’s announcement in September 2014 that a Labour government would review the entire tribunal system if successful in the next general election.


© 2014 Chambers of Lawrence Power, 4 King’s Bench Walk, Temple, London, EC4Y 7DL. Tel: 020 7822 8822.  www.4kbw.net