For many years employers have noted with concern how easy it is for employees to be able to bring Tribunal proceedings with little consideration of the merits of their claim. Part of the reason behind this has been due to the fact that no fee is required to be paid in order to bring such a claim and the costs regime means that it is difficult to obtain costs from the losing party.

The Government has been consulting about introducing fee structures in Tribunal cases. Their initial proposals were to require either the payment of one fee on commencing the proceedings or the payment of two fees, with one fee becoming payable on commencement of the case and the other becoming payable prior to the actual hearing. The Government has concluded its consultation and published its proposals. The aim is that the fee regime will be put in place by the summer of 2013. The anticipated effect is the reduced cost to the tax payer of financing the Tribunal process (although the fees will not cover the entire cost of the Tribunal system). The Government has also made it clear that they intend to review the fees in due course and therefore they could well be increased further.

The new fee structure

The results show that the two fee payment system is likely to be implemented. The hope is that cases will be encouraged to settle early on in the proceedings rather than incurring the payment of the second fee prior to the hearing.

The fees will vary depending on the type of case being brought, whether there is a single or multiple claim being presented. The proposed fees for single claims are:

Level 1 claims will cover very straightforward claims, such as unlawful deduction from wages claims for amounts due on termination such as unpaid wages, redundancy payments and payments in lieu of notice. These will involve an issue fee of £160 and a hearing fee of £230

Level 2 claims will cover most other claims such as unfair dismissal, discrimination, whistleblowing and equal pay claims. These will involve an issue fee of £250 and a hearing fee of £950

Appeals to the Employment Appeal Tribunal will attract fees of £400 for the appeal fee and £1200 for the hearing fee.

Judicial mediation will cost £600.

Reviewing a default judgment (where the employer's defence in the form of a Response Form has not been received in time and judgement has been entered against the employer which they are seeking to overturn) will cost £100.

Seeking to dismiss a claim once it has been settled to avoid the employee issuing alternative proceedings in another forum will cost £60.

Claims by multiple claimants

Claims brought by multiple employees will benefit from group discounts. Where a claim is brought by between 2 and 10 employees, a fee of double the amount of the issue fee and hearing fee would apply. In the case of between 11 and 200 claims this would rise to a multiple of four times the fee and in cases involving over 200 claims, six times the fee.

Fee remission

Those on low incomes will not be required to pay the above fees. Consultation regarding how the fee remission structure will operate and apply will be revealed in Autumn 2012 amid concerns by employers that most individuals bringing claims will be out of work and thus on low or no income.

The above fees are substantial for anyone to pay, particularly those on low incomes. Fees of £390 to succeed in a claim for unpaid notice pay may well exceed the amount claimed. If the employer fails to defend the claim it is likely that they will be required to reimburse the employee the fees in addition to the value of the claim. The stakes are therefore about to be raised for anyone who wishes to embark on the Tribunal process.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.