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The Government has now confirmed it will introduce a system of
fees in Employment Tribunals and the Employment Appeal Tribunal
with effect from Summer 2013 in an attempt to reduce the taxpayer
bill for the Tribunal system, which currently runs to more than
£80m per year.
The amount payable by claimants depends upon the type of claim
brought. "Level one" includes claims for deductions from
wages, breach of contract and various payments on termination, and
"level two" encompasses unfair dismissal, discrimination,
whistleblowing and failure to consult on redundancy and TUPE
transfers, amongst others. Claimants will therefore be required to
pay an "issue fee" of either £160 or £250
when they file level one or level two claims, respectively, with a
further "hearing fee" of either £230 or £950
becoming payable by the claimant around 4 to 6 weeks before a full
hearing.
In addition, where a claim is brought by multiple claimants, for
example equal pay or collective consultation claims, the issue and
hearing fees increase incrementally according to the total number
of claimants. This is subject to maximum issue and hearing fees of
£1,500 and £5,700, respectively, for level two claims
brought on behalf of 200 or more claimants. Fees will also become
payable when making some applications in relation to active
proceedings including a £60 fee payable by respondents who
make an application to have proceedings against them dismissed
after settlement.
The fees are lower than what was originally proposed back in
December 2011, and the Government has confirmed that they will be
reviewed after implementation. Trade Unions have, however, still
criticised the fees as excessive, suggesting that the system serves
only to thwart genuine claims by employees against employers. Where
an employee has been unfairly dismissed and is without work,
expecting them to pay a total of £1,200 in order to rectify
the injustices they have already suffered is unreasonable, it is
argued.
The Government, however, emphasises that a system of fee waivers
will prevent the scheme from serving as a deterrent to legitimate
claims. Claimants who receive certain benefits, such as Job
Seekers' Allowance, do not have to pay any fees. Similarly,
where a claimant's earnings are below a certain threshold
(£13,000 for single claimants and £18,000 for couples
of which one is the claimant, increasing by £2,390 for each
child that the claimant or couple has), all fees will be waived.
This is in addition to partial waivers which are available on a
means-tested basis according to the amount of disposable income
enjoyed by a claimant.
The primary aim now identified by the Government in introducing
the scheme is a reduction in the burden on the taxpayer, and while
it is clear from its press release that unsuccessful respondents
will be ordered to reimburse claimants' fees, the Government
has not totally abandoned the notion that introducing a cost to
potential claimants encourages resolution without litigation, and
discourages spurious claims from littering Tribunals.
It is for this reason that business groups have spoken out in
favour of the proposals. It is yet to be seen, however, the extent
to which this support will continue in light of the reduction of
fees originally proposed and the extent of the fee waiver
system.
A full plan for implementation will be determined in the coming
months in line with the broader review of Employment Tribunals
announced by the Government last year including a review of the
Employment Tribunal rules of procedure. It will, however, be
interesting to see what effect, if any, the introduction of fees in
2013 has on the downward trend in the number of claims brought in
the Employment Tribunal over recent years.
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