Access to employment rights in jeopardy

Summer 2013 will see the start of a new stage in employment law with the introduction of fees in employment tribunals. Since the tribunal service was first introduced in 1964, the cost of bringing a claim has always been free. It is thought that by introducing fees, those who wish to bring a claim can bear the burden of the £84m cost of running the employment tribunal system currently shouldered by the taxpayer.

From next summer, if a claimant wishes to take a claim to tribunal they will have to pay both an issue fee and a hearing fee. To bring an unfair dismissal claim or discrimination claim it will cost in the region of £1,200; £250 to issue the claim and £950 to get a hearing date.
A more straight forward claim, such as a claim for unlawful deduction from wages, holiday payments and redundancy payments, could total £390; £160 to issue and £230 for the hearing. Where more than one claim is brought, which is very common in employment matters (for example unfair dismissal and discrimination), the highest fee payable for either of those claims will be payable. This will effectively prevent a vast number of employees from having access to justice.

Lower pay employees

The main concerns over these proposals centre on low income earners. An environment will be created enabling employers to flout the law safe in the fact that there is little recourse for their lower paid employees. Many people will give up and not enforce their employment rights if their claim is relatively low in comparison to the tribunal fee, for example a claim for unpaid wages. Only those that can afford to pay will be able to bring a claim, cutting off a number of people from a right to justice. For example, if an employee, earning minimum wage, has £250 unlawfully deducted from his wages, it will not be worthwhile bringing a claim if the issue ?fee alone is £160.

Even if the high cost of bringing a claim discourages people from commencing proceedings, it does not mean those claims will go away. Many people will end up staying in their employment and enduring the behaviour that has caused them to want to bring a claim. This could in turn have far reaching consequences for the employees in question.

Those who champion the reforms believe it will encourage claimants to look to alternative methods of solving disputes, such as mediation and arbitration. However, employment law is already an area where a vast number of cases are settled before ever reaching tribunal stage. Whilst the new policy may encourage early settlement of disputes, it is debateable whether such encouragement is needed with so many employment claims already ending in compromise agreements.

The new system could actually have an undesired affect on settlements. An employment claim can settle at any point before the hearing takes place, even on the morning of the hearing. If a claimant has paid an issue fee and a hearing fee they will be less likely to want to settle and will want their day in court. This could have an adverse affect on settlements which is not something that should be welcomed.

Complex remission scheme

There is some talk of a remission scheme being put in place to aid those who cannot afford to fund a claim. Those on low incomes could be exempt from some or all of the fee. The initial thoughts on this scheme are that it is complex, time consuming and will also come at a cost. Considering some claims at present can take up to a year to work their way through the tribunal system and have a hearing date allocated, introducing a complicated remission scheme will not necessarily have the desired affect the government are hoping for.

If we couple employment tribunal fees with the introduction of the two year qualifying period for an unfair dismissal claim, workers are increasingly being denied access to their employment rights

There are alternatives to the proposal which include lower fees being charged so as to divert some, if not all, of the cost away from the taxpayer onto the users of the service. Or, to force the 'loser' of the claim to retrospectively pay for the issuing and hearing fees as a penalty for wrongdoing. This could work in much the same way as civil claims where costs are awarded to punish the wrongdoer and not to penalise the victim.

It will take some time to determine whether the introduction of fees is something the tribunals can handle. Considering the long wait experienced at many tribunals at the moment it seems odd to introduce a new policy that will delay the system even further.

The main benefit in these reforms will be for employers. Employees will think twice before bringing a claim and those who do have genuine claims could be deterred completely. This poses the greatest threat to access to justice.