Supreme Court Declares Employment Tribunal Fees Unlawful

In R (on the application of Unison) v Lord Chancellor 2017, the Supreme Court has ruled that employment tribunal and Employment Appeal Tribunal (EAT) fees are unlawful and it has quashed the Employment Tribunals and the Employment Appeal Tribunal Fees Order 2013 with immediate effect. The Supreme Court held that the fees regime was unlawful under both UK and EU law as it prevents access to justice and imposes unjustified limitations on the ability to enforce EU rights; fees had been set at too high a level. In addition, the higher fees payable for Type B claims (which includes discrimination claims) were held to be indirectly discriminatory against women and other protected groups.

All fees paid by claimants since 29 July 2013 will now be reimbursed by the government and it will announce the details of a refund scheme in due course (and this will presumably cover what happens where the respondent employer repaid the fee to the claimant following a successful tribunal claim). Unison has estimated that the government will have to repay over £27 million in fees.

In addition, fees are no longer payable for lodging new claims before the employment tribunal or the EAT. HM Courts & Tribunals Service is to launch a new online tribunal claims service without any reference to fees. In the meantime, claimants can ignore any requests to pay fees. The tribunal rules will also have to be changed to remove all references to the payment of fees.

The immediate abolition of fees is likely to result in a significant increase in new tribunal claims. There may also be claims from claimants who are “out of time” for lodging their claim, arguing that they were deterred by the fees and should therefore now be granted an extension in the time limits. Most tribunal claims must be brought within three months of the issue being complained about. Time limits are strictly enforced and tribunals can only extend the limitation period if claimants can demonstrate that it was either “not reasonably practicable” to have issued on time in relation to unfair dismissal and other contractual claims or that it is “just and equitable” to extend time in respect of discrimination claims.

It remains to be seen whether the government will try to introduce a new regime with lower fees, but this seems unlikely at least in the short term.