EMPLOYMENT TRIBUNAL FEES ABOLISHED - WHAT HAPPENS NEXT?

The decision of the Supreme Court in the case brought by Unison may well be the most important employment law decision this century. 

To recap, the Supreme Court decided that the government order imposing fees for ET cases was unlawful from the start. They did so on the basis that 

•  it was contrary to the rule of law that statutory rights granted by Parliament should be diminished by statutory instruments in this way 
•  the Fees Order prevented access to justice, and was ultra vires;
•   it imposed unjustified limitations on the ability to enforce claims based on EU law;
•  it was indirectly discriminatory to charge fees at the higher level for discrimination cases..

What is likely to happen now? The government has shown no desire to re-introduce fees at a lower level, as some commentators had predicted. It could of course try to do so, but the legislative path would be unclear. Any attempt to introduce a new fees regime in Parliament could well be defeated, given the state of the parties in the Commons, let alone the Lords. Even if that route proved successful, the political message it would send might not be a helpful one for the present government. And the introduction of a less onerous fees regime by statutory instrument would be an invitation for further challenge in the courts and possible defeat, and would carry the same political disadvantages.

So we should be looking at what the future will look like without fees for ET claims. 

What are implications of the new situation?

First, those who paid fees during the period 2013-2017 are entitled to have them reimbursed. The procedure has not been announced at the time of writing, but advisers should keep an ear to the ground for its details.

Second, what about those who were deterred from pursuing claims during the last four years? For some at least, there is a prospect of reviving the claim. The ETs have a discretion to allow a claim to be heard when it is outside the primary time limit (usually three months). The test for the exercise of this discretion varies according to the nature of the claim in question. 

For the majority of claims (including unfair dismissal, wrongful dismissal, deduction from wages, holiday pay, minimum wages) the claimant must show that it was not reasonably practicable to bring the claim during the three months in question, and that it was brought within a reasonable time thereafter. If a claimant alleges that they were deterred from bringing a claim because of the fees regime, the following points are crucial:

•  the claimant would need to show that they were not entitled to remission from fees (the scheme was known as “Help With Fees”)
•  they would need to establish that their financial position was such that it was not reasonably practicable to pay the fee
•  this would usually require producing hard evidence in the form of wage slips, bank statements, bills and the like
•  the claimant would need to have presented their claim to ACAS for early conciliation within a reasonable time of knowing of the Supreme Court decision, and presented the claim swiftly once ACAS issued its certificate that conciliation was over.

It is worth noting that the lead judgment in the Supreme Court pointed out that the fee for small claims (e g for wages) was disproportionate. On the face of it this might assist an argument that it was therefore not reasonably practicable to bring a claim in the ET. Where the claim in question involves a breach of contract, however, it could have been brought in the County Court (and possibly still could be pursued there given the much longer limitation period in the ordinary courts). That will involve an additional consideration for the ET in deciding whether to exercise its discretion in the claimant’s favour.

So much for those claims where “not reasonably practicable” is the hurdle for the claimant to clear. What about those cases where the ET can extend time if ti is Just and equitable  - notably for discrimination claims? The test here is somewhat more liberal, and enables the ET to take a variety of factors into account. The points made above about the need to be as quick as possible in seeking early conciliation, and the presentation of cogent evidence of financial hardship apply to this situation also. But the ET will be more easily able to extend the deadline in the face of arguments about the justice of doing so. A couple of points need to be emphasised, however. First, an employer may be able to rely on the fact that a crucial witness or important documentary evidence is no longer available in order to weight the balance of equity in favour of not allowing the claim to proceed. Second, where the claimant is arguing that it is just and equitable to extend the deadline, the merits of the claim will clearly be relevant. There is no justice to be found in allowing a claim to proceed to hearing if it will fail, with all the time trouble and money which that will involve for those concerned.

There is also the position of those who presented a claim during the period of the fees regime, and withdrew it or had it struck out when they were told that they must pay a fee in order for the claim to proceed. Claimants in this position will need to apply to the ET to reinstate the claim, using some formula such as “In view of the decision of the Supreme court int R (on the application of Unison) v Lord Chancellor I request that the tribunal reinstate my claim and list it for hearing. The argument would be that it is “in the interests of justice” for the claim to be restored. The view taken by the ET is likely to depend on whether the circumstances are such that a late claim would be allowed. The points made above about such claims would then apply.

All of these arguments, and others with numerous variations will no doubt be aired in the ETs over the coming months. Which leads one to ponder on the current state of those Tribunals. They have been geared, in terms of both judicial and administrative resources, to a level of some 30% of cases compared with the pre-fees era. They will now be confronted with a workload which will not just be equivalent to that before the introduction of fees. That workload will rise to accommodate those who wish to bring new claims, and to those must be added the backlog of cases where claimants decide to pursue claims from which they were deterred in the fees era. 

An increase in resources for the ETs is urgently needed in order to cope with the inevitable rise in demand. That need will also be reflected as far as ACAS is concerned, as the pressure for early conciliation (and indeed for later settlement) grows. We need to avoid a situation where one hurdle to access to justice has been eliminated, only for the barrier imposed by lack of resources and consequent delays to bring about another unjust result.

John Sprack

October 2017