But final court ruling not expected until autumn at the earliest
New statistics just published by the Ministry of Justice confirm a sustained reduction in the number of employment tribunal claims lodged since fees were introduced last year. The figures, covering the period January to March 2014, will increase pressure on the government to rethink the fees regime.
Claimants currently pay up to £250 to lodge tribunal claims, with further fees payable as proceedings progress.
Latest figures
This time last year, the published claim figures revealed that 13,491 ‘single’ claims had been received in the first quarter of 2013. The comparable figure for 2014 is 5,619 - a 59 per cent reduction. ‘Single claims’ are those made by a sole employee/worker and provide a reliable gauge of trends.
The drop is consistent with figures from the previous quarter, which showed a 64 per cent reduction in claims as against the previous year.
Impact of fees
Employers are now less likely to face employment tribunal claims than in previous years. Those employees who do bring claims are more likely to abandon them, or at least try to settle before the final hearing, as that is the point at which a further fee falls due.
The sorts of claims least likely to be affected by the introduction of fees are those where the stakes are high. For example, claimants are less likely to be deterred by fees where the overall amount of compensation at stake is relatively high. This could include cases where a dismissed employee was well paid or enjoyed generous pension benefits, or cases involving several employees, such as those about collective consultation, equal pay or the calculation of holiday pay. Potential claimants will also be less concerned by fees if they are union members, as unions are known to be funding fees where claims are thought to have reasonable prospects of success. Furthermore, some claims for unpaid wages and notice pay can still be brought in the county court, where fees are generally lower - at least where the amount claimed is low.
Few employers opposed the introduction of tribunal fees, and there is little doubt that fees have curbed the number of claims perceived as dubious or tactical. That said, those who strive to be good employers will not relish the idea that less scrupulous businesses could be getting away with flouting the law.
Future developments
No doubt UNISON, which is pursuing judicial review proceedings against the government, will be hoping to rely on the latest statistics to shore up its case for the fees regime to be quashed. UNISON alleges that this regime breaches the EU principle of effectiveness by making it excessively difficult to enforce employment rights, and is indirectly discriminatory. Although the High Court has rejected UNISON’s arguments, the union is appealing its decision.
The earliest we could hope to have a final ruling from the Court of Appeal is probably this autumn, given that the case is scheduled to be heard some time between September and December. However, the judgment may not be the final word on the matter and the dispute could rumble on for at least another couple of years, with further hearings along the way.
The government has committed itself to keeping the fees and remission schemes under review. We do not expect any formal appraisal to start in earnest until much later this year. However, the sustained and significant drop in claim numbers will increase the pressure on the government to reconsider the levels at which fees have been set and/or the criteria for exemption (also known as remission).
If, ultimately, there is a change, whether as a result of UNISON’s claim or the government’s review, a reduction in the fees payable or an adjustment of the remission scheme seem more likely than a wholesale repeal. Eventually, therefore, the number of claims may rise, although it is unlikely to return to the levels we have seen in the past.
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