OUR popular breakfast seminars have made a return, the first of which looked at how the recent removal of fees attached to employment tribunals will affect employers and what they can do to safeguard their business. More than 30 people attended the event – held on 27 September at Brewhouse Bar & Kitchen and led by our employment specialist, Emma Tegerdine – which delved into why the U-turn has been made and what the results are likely to be for Nottingham employers.
The scrapping of employment tribunal fees has been described as the ‘most significant judicial intervention in the history of British employment law’ – a statement I would agree with; it’s going to make a huge difference and employers need to be prepared.
Employment tribunals were first established in 1964 – created to uphold employment rights. Fees were first introduced in 2013 with the government claiming that paying for the tribunals’ services would:
- Help transfer some of the costs burden from taxpayers to those who used the employment tribunal system
- Encourage parties to settle claims at an earlier stage
- Discourage people from making weak or vexatious claims
In order to make a claim, claimants would be required to pay an issue fee of either £160 or £250, which then went up to £230 or £950 to pay for hearing fees.
The impact this had on the number of claims put forward was far beyond what was expected – there was a huge reduction; the amount of claims really did fall off a cliff. Tribunals received 67% fewer claims per quarter compared to what had previously been experienced and there was no indication that this reduction had weeded out the weaker claims – there was simply a decrease in claims across the board.
Unison challenged this introduction periodically and was regularly knocked back– to the point where I, along with many other employment law specialists, had come to accept that this was the end of the story; that the fees were here to stay.
Unison then appealed to the Supreme Court under the grounds that the fees:
- Denied people access to justice
- Indirectly discriminated against women
- Were ‘ultra vires’ – as it frustrated the operation of primary legislation
Working in Unison’s favour was, that, of the £60 million spent by employment tribunals during the period of 2013 to 2017, only £8 million was recouped in fees – a figure much lower than predicted.
Unison was victorious and, on 26 July 2017, it was announced that tribunal fees were to be scrapped, with the Supreme Court deeming them unlawful. The Supreme Court also claimed that it was unrealistic of the government to expect those on lower incomes to pay fees which seemed to have little correlation to the claim itself. If barriers to enforcing employment rights are put in place, it made these rights worthless – which is what clearly had happened from 2013 – 2017 whilst the fees were in place.
So, employment tribunals are now free – what does this mean now?
- The first thing to consider is the potential for historical claims to now be made. Ordinarily, there is a three month deadline on claims being able to be lodged – whereas now, claims dating back three years are able to be made.
- Secondly, the number of claims is expected to increase considerably. I’ve already noticed this in Nottingham and fellow lawyers across the country have reported a similar situation – employment tribunals are inundated and there isn’t any sign of this slowing.
- There’s also a chance that vexatious claims will increase – something employers really need to be wary of.
As for businesses, there are a number of actions that can be taken to minimise risks.
- Ensure that staff have up-to-date contracts.
- Review HR policies/procedures – or put the appropriate policies in place.
- Consider providing training on difficult issues such as equal opportunities and social media – speaking from experience, social media can be a contentious subject and employees aren’t always aware of the rules surround their employment and their social media usage outside of the workplace. We provide bespoke training for businesses which have been found to be really helpful and beneficial to employers and employees.
- Keep on top of conduct and performance issues and deal with any issues promptly and appropriately – if there’s an employee you’re having second thoughts about it’s best to address this in a timely and efficient manner.
- Be pro-active about reasonable adjustments for disabled members of staff – as an employer, it’s your responsibility to make the appropriate adjustments for disabled employees; it’s not up to the employee to address it with you.
It’s not all doom and gloom though and, for most businesses, it shouldn’t be an issue and you should be able to resolve issues that arise – but being prepared and informed is essential.
For more information on how we can help your business, contact our Employment team.