Today is a landmark day for employment law as it sees the introduction of tribunal fees for the first time since the introduction of the Employment Tribunals (ET) in 1965.
The aim of introducing the fees is to reduce the number of claims that are issued in the ET. In 2010/2011, 218,000 claims were issued and the ET simply cannot process this many claims. It is hoped that the fees will result in a 25% reduction of claims being made, which will make the whole system much more efficient and quicker.
From today, all new claims should be sent to the main ET office in Leicester (or Glasgow if in Scotland) by post or by submitting it online. The new rules provide that the Claimant must pay a fee (“the issue fee”) when a claim is sent and a separate fee for a final hearing of the claim (“the hearing fee”).
The fee payable will depend on the type of claim and the number of workers bringing a group claim. The minimum amount for the issue fee will be £160 and the minimum amount for the hearing fee will be £230, but this could be as much as £950 for certain claims. There will also be various other fees associated with making application and appeals.
Those Claimants who cannot afford to pay the fees may apply for remission by completing the new form T438A. The form asks for information about household income and for supporting documentation. The Claimant may apply for remission is he/she falls into one of the following three categories:
- Full remission if the Claimant can show he/she is in receipt of state benefits, and has a recent original letter confirming the same; or
- Full remission if the Claimant can show, by producing recent original pay slips, that the gross annual household income is below a certain amount; or
- Partial remission if the Claimant can show, by providing a great deal of supporting documentation, that the disposable monthly income is less than £50.
Whenever a claim is sent, the Claimant must send the issue fee in full or a completed remission form with supporting documentation. If the Claimant fails to send the issue fee or completed remission form (or if the application for remission is rejected) then the ET will send a notice saying that the fee must be paid within a specified time. If the fee is not paid in time then the claim will be rejected. Once the fee has been paid, or the application for remission has been accepted, the claim itself will be reviewed to determine whether there is a viable claim.
One potential problem for Respondent employers is that they will not be told about the claim until the fee has been paid, or the remission form has been accepted, and the claim has been sifted by the ET. In theory, this could take several weeks, or even months, depending on the backlog at the ET.
If the claim is accepted then the ET will deal with the claims in the normal way and set a date for a final hearing in the Claimant’s local ET. Once a date for a final hearing is made, the Claimant must pay the hearing fee by a specified date. If the Claimant cannot afford the hearing fee then he/she will need to make an application for remission. Again, if the application for remission is rejected or if the Claimant simply does not pay the hearing fee in time, then the claim will be withdrawn.
If the Claimant is partially or fully successful with their claim, the Tribunal may now order the Respondent to refund the Claimant the fees paid in addition to the judgment sum. This is something that the Respondent will need to start factoring into their settlement discussions, but this may be very difficult because the Respondent will not know whether the Claimant is entitled to remission or not until the end of the final hearing.
There has been resistance to the introduction of the fees on the basis that it is unfair for the Claimants to incur high fees. There is currently a challenge about the legality of the introduction of the Tribunal fees going through the Scottish Courts and, if the outcome is that fees should not be paid, then the Tribunal fees may be scrapped across the whole of the UK. If the Government loses the case then it will have to repay any fees paid from now. We will of course keep you updated on this case, but for the time being the new rules shall apply to all claims made from today.
If you’d like to discuss this hot topic then please contact Shiva Shadi who is head of our Employment Law team…