Supreme Court rules tribunal fees illegal: what this means for employers and employees

The Supreme Court has ruled that is illegal for employment tribunals to charge workers a fee for bringing cases against their employers. This ruling came about as a result of a case brought by the trade union Unison, which argued that the fees (which went as high as £1,200) were dissuading workers from pursuing legitimate claims.

The UK government has accepted the ruling and employment tribunal fees have now been abolished. This is likely to have a significant impact for both employers and employees, including encouraging many more workers to pursue claims against their employers or former employers.

What scrapping employment tribunal fees means for businesses

The number of workers bringing claims against their employers fell by 73% after employment tribunal fees were introduced in 2013. It is likely that the fees being scrapped will lead to a significant increase in future claims, meaning employers may need to take extra steps to protect themselves. This may include reviewing the contracts of employment they provide to workers, as well as looking at reviewing or creating policies around discrimination, disciplinary action and handling grievances.

Businesses also need to be aware that there is a possibility workers may be able to bring historic claims where they were previously put off by the fees. Normally there is a 3-month time limit to bring a claim after an incident, but there are now calls for this time limit to be waived for claims related to incidents that occurred during the period where the fees were in effect.

Although no decision has been made on this yet, it may be worth employers considering any employees or former employees who might be likely to bring a claim if the time limit were waived. Consulting an employment lawyer about the potential consequences of any likely claims could help you avoid being caught off-guard.

What ending employment tribunal fees means for workers

For workers, the end of employment tribunal fees means it will be easier to bring a claim against an employer or former employer. It also means that employers will know there is no barrier to workers bringing claims, making it more likely they will be willing to settle early to avoid the risk of going to a tribunal.

If you previously chose not to bring a claim to an employment tribunal because you could not afford the fees, or felt they were too high to make your claim worthwhile, there is a possibility that you will be able to bring your claim in future. The idea of scrapping the usual 3-month time limit to bring a claim for people affected by the fees has been discussed, although no decision has yet been made.

Will employment tribunal fees be refunded?

If you brought an employment tribunal claim during the period when fees were in effect, you will be entitled to a refund for the fee you paid. The government has said it will “put in place arrangements to refund those who have paid”, but the details of these arrangements have not yet been announced.

For more information and advice on how the Supreme Court ruling might impact you or your business, or general advice on employment tribunals, please get in touch on 01202 292 424.