UK: Supreme Court Declares Employment Tribunal Fees Unlawful – What Does It Mean For Employers?

The Supreme Court has unanimously ruled that the introduction of tribunal fees in 2013 was unlawful and must be quashed on the basis the fees have the effect of preventing access to justice and are indirectly discriminatory. The result is that there will be no fees to be paid to file or pursue claims.

The Supreme Court accepted that the purposes behind the introduction of fees were potentially legitimate - transferring the cost burden to the 'users' of the tribunal system, incentivising earlier settlements, and discouraging weak or vexatious claims. However, the Lord Chancellor could not lawfully impose whatever fees he chose in order to achieve those purposes. In order for the fees to be lawful, they must be set at a level that everyone can realistically afford, taking into account the availability of full or partial remission. Equally, the fees must not render claims futile or irrational to be brought as some claims do not seek financial reward or (only modest amounts) but remain equally important, for example the right to rest breaks and statements of employment.

On the evidence produced, the Supreme Court concluded that the fees imposed are, in practice, unaffordable and far too high, preventing even people who can afford them from pursing claims for small amounts and non-monetary claims. As such they prevent access to justice and accordingly unlawful "ab initio", in other words from the outset. As for the aims of increasing settlements and decreasing weak claims, there was no evidence to support that the introduction of fees achieved such aims.

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