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Tribunal fees – the future landscape of the Employment Tribunal system

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Did you know that the Employment Tribunal is going to charge Claimants for bringing a claim? The same applies if a Claimant wishes to appeal an unfavourable decision made by the Employment Tribunal.  This may now be common knowledge but the Government have now decided when Tribunal fees will start.

As we advised you in our New Year preview knowledge in January, the Government propose to introduce fees at the Tribunal.   Members can click here to read our New Year knowledge that dealt with this and other changes forecast for 2013.

This proposal has now been confirmed and it is suspected that it will come into force at the end of July 2013.

It was initially thought that Claimants could only pay their fees electronically and so would be forced to submit claims online via the Tribunal website or through a centralised processing centre only. However, it has now been confirmed that Tribunals themselves are likely to have a payment system in place, so Claimants can continue to submit their claims in person at the Tribunal.  It remains to be seen how this will work in practice with the already limited resources of Tribunal system.

How will the Tribunal fee system work?
Claimants will have to pay an issue fee in order to submit their claim to the Tribunal and a further listing fee in order to proceed to a full hearing.  The level of the fee will depend on the type of claim. There are three types of claim as follows:

  1. Type A claims are more straightforward and lower value.  This will include unpaid wages, redundancy payments and payments in lieu of notice.
  2. Type B claims include all other claims, including unfair dismissal, discrimination, equal pay and whistleblowing claims.
  3. Appeals where either party wants to appeal an initial decision of a Tribunal.

If more than one complaint is brought, only one fee will be payable and that will be the higher of the two.

Tribunal fees are likely to be as follows:

Type A claims Type B claims Appeals
Issue fee £160 £250 £400
Hearing fee £230 £950 £1,200

 

The hearing fee will become due on a date that will be set out in the Employment Tribunal’s notification of hearing. This means that the hearing fee could be payable months before the actual date of the hearing. This leaves uncertainty as to what happens to the fee if the claim settles during this period.

What effect will this have on employers?
It is hoped that the implementation of Tribunal fees will reduce the amount of unreasonable claims (or appeals) that are brought by deterring employees from bringing a claim (or an appeal) if they are not assured that their Tribunal claim (or appeal) has good grounds.  Whether this will be the case remains to be seen.

Penalties for failure to pay issue or hearing fees may possibly lead to a strike out of a Tribunal claim meaning that the Claimant will no longer be able to pursue their claim if they fail to pay. However, what remains unclear is what happens if a Claimant pays their fee late and whether or not the Employment Tribunal will allow the reinstatement of their Tribunal claim if it has already been struck out.

Tribunals will also have the power to order the unsuccessful party to reimburse the Tribunal fees paid by the successful party. This means that if an employer is unsuccessful in defending a claim they may have to repay the fee(s) paid by the Claimant on top of any compensation awarded and their own legal costs.

So what effect is this likely to have?  In the more immediate future, it is likely that there will be a spike in the amount of Tribunal claims brought just before the end of July 2013.  There will be no fee payable in respect of a claim where the claim form was presented before fees are implemented.  We also suspect there will be a lull shortly after the implementation in July 2013.  Much will depend on how the remission system works in practice.  We will explain this in more detail in our next knowledge piece, please click here to read that article.

If you are concerned about a potential Tribunal claim that your organisation is facing, or if you want further information and advice on how to avoid such claims, please do contact any of the employment team on 01332 226 149 for a confidential chat.

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