New Rules new Fees

This article first apeared in People Management 23 July

History will record that we once had an Employment Tribunal system of which we should have been more proud and more protective.  Under that system, a framework of employment rights was underpinned by a forum for resolving disputes before a panel, balanced with legal and practical experience.  Access to justice was free to all.  The Tribunal would listen patiently (mostly) to the evidence and provide detailed reasons for their conclusions. 

This system, which the Government seems intent on dismantling piece by piece, is not perfect.  The frivolous and the vexatious can be indulged for longer than is good for anyone, including themselves.  But broadly it works well and with only minor changes could be made to work better.  In this context the Fundamental Review of Employment Tribunal Rules which has recently been published by the Honourable Mr Justice Underhill is to be welcomed.  New Rules proposed by the Review are shorter than the existing Rules and written in plain English.  There is more emphasis on robust case management, including an initial sift stage once the claim and response have been submitted at which every case will be reviewed by a Judge on the papers.  Case Management Discussions and Pre-Hearing Reviews will be efficiently consolidated as "preliminary hearings."

However, one of the effects of the Rules is to continue the trend of front-loading preparation costs onto the parties.  Written witness statements are now routinely taken as read and for the future, under the proposed Rules, we will have time guillotines on oral evidence and submissions.  The better the case preparation the better the prospects of success because in the new system there will be far less room for a skilled advocate to rescue a poorly prepared case on the day.  Aggressively imposed guillotines risk removing some of the cathartic benefit the parties have previously "enjoyed" from explaining their case to a Tribunal – a key ingredient of the dispute resolution mix.  The claimant who "wants his day in court" could now find himself cut off after 15 minutes. In extreme cases unrepresented claimants struggling to get to grips with the law and present their evidence could attempt to appeal a Tribunal decision on the basis that they have not been given sufficient opportunity to present their case.  The Rules are likely to be put out to consultation later this year.

Less universally welcomed is the Government response to the consultation, Charging Fees in Employment Tribunals and the Employment Appeal Tribunal, published on 13 July 2012.  The Government will now introduce a fee structure from summer 2013. The headline proposals are:

• Level 1 – claims "generally for sums due on termination of employment e.g. unpaid wages, payment in lieu of notice, redundancy payments". The issue fee will be £160; the hearing fee will be £230.
  
• Level 2– including those relating to unfair dismissal, discrimination, equal pay and whistleblowing. The issue fee will be £250; the hearing fee will be £950.
  
• Other fees will apply to specific applications. For example, for judicial mediation of a Level 2 claim, the fee will be £600.
  

Employment Tribunals will have the power to order the unsuccessful party to reimburse the fee to the successful party. Many people on low incomes may not be required to pay the full fees, under the same remission system which already exists for court users. According to the press release, the new fees will be tailored to encourage mediation or settlement rather than a full hearing.  The Government protests a little too much that it is not the objective of this policy to deter claims.  The reality is that fees will be a major disincentive to the genuine victims of unfair and discriminatory treatment and will more likely encourage employer intransigence on the assumption that many claimants will withdraw or settle cheaply rather than pay the hearing fee.  Respondents who see this as a progressive step should first consider the wider implications.  I once had a client who was constantly bemoaning the Tribunal system right up to the point that his daughter was unceremoniously dismissed by her employer.

Richard Kenyon, Head of Employment & Pensions Law Group at Fieldfisher.