Access to Justice - Employment tribunal fees quashed in surprise decision

The significance of the Supreme Court ruling in this landmark ruling cannot be over stated. It extends beyond the realm of employment law. There must be a preserved guarantee of access to justice, prompt and fair.   Its judgment is extraordinary not just for its ruling that the fees are illegal, but for the way it justified that ruling. The supreme court made its case primarily based not on EU law, but on two principles of common law: the constitutional right of access to justice and the rule that statutory rights, established by parliament, must not be undermined by secondary legislation with minimal parliamentary scrutiny. This not only makes it Brexit-proof but in doing so, the supreme court explicitly questioned the government’s understanding of the rule of law.

Employment lawyer Dawn Robertson has over 15 years’ experience in this field and is an accredited specialist in employment law by the Law Society of Scotland. Here she provides a guest blog for us on the judgement.

Although the UK Supreme Court was established in October 2009, it has had a relatively low key existence for much of the time since then. However, being the final judicial forum for the Article 50 Brexit appeal earlier this year brought its existence significantly more publicity than it had previously received.

That appeal, in fact, delayed the hearing of another high profile appeal, namely the judicial review appeal presented by the Trade Union, UNISON, against the Lord Chancellor on the issue of whether fees imposed by the Lord Chancellor in respect of proceedings in employment tribunals and the employment appeal tribunal are unlawful because of their effects on access to justice.

The UNISON appeal was, finally, heard at the end of March this year, over three and a half years after the tribunal fees regime were first introduced. The decision of the Court was handed down on 26 July this year, just three days short of the fees’ fourth birthday.

Tribunal fees regime

Under the tribunal fees regime, anyone wishing to make a claim against a current, former or prospective employer required to pay an initial ‘lodging’ fee and then follow up with a hearing fee. For all but the most minor cases, the combined cost was £1,200. Further, even for successful claimants, the costs were not automatically refundable, either from the tribunal service or from the respondent employer.

Although UNISON fought its case on a number of fronts, the Court’s decision focused on the common law right of access to justice in its principal judgment, delivered by Lord Reed. Fundamentally, overturning the decision of the Court of Appeal, the Court’s view was that the right of access to justice was ‘deeply embedded’ in our constitutional law and therefore, in order for fees to be lawful, they had to be set at a level that everyone can afford. A number of difficulties were identified by the Court, ranging from a lack of understanding of how price affects demand (i.e. if it’s too expensive, it won’t be used) through to a lack of consideration of the many factors which will be weighed up in the minds of would-be claimants at the point of deciding whether to make a claim.

In all the circumstances, the Court found the fees regime to be unlawful from its inception, the evidence having demonstrated that there was a real risk that the fees were not affordable by everyone.

Implications

UNISON’s case had been unsuccessful up to the point of the final appeal to the UK Supreme Court. As a result, it is fair to say that the Court’s decision caught everyone by surprise. As the decision became known, one well known English QC tweeted that he would have to lie down in a dark room.

Within days of the decision, the tribunal service had taken steps to remove the fee paying element of its online system. Beyond that, the result of the decision is potentially far-reaching, although it will take time to understand the full implications. For now, it is clear that all parties who have paid fees under the regime since the beginning are entitled to a refund. In the most straightforward of cases, this is likely to mean an application by the paying party, being the claimant in all but EAT cases. The situation is immediately complicated, however, by the fact that, in some cases, the respondent employer may have been ordered to reimburse the fees to the claimant, meaning that, in fact, they rather than the claimant are ‘out of pocket’. In addition, cases settled between parties may have included an element of tribunal fees compensation but the respondent will have no automatic entitlement to reimbursement from the tribunal service in such circumstances. There are also cases which were dismissed by the tribunal service administration for failure to pay the fee and this is going to be a headache for the tribunal service as clearly these cases require to be resurrected.

But that’s not all. What about the would-be claimants who would have made a claim were it not for the fees regime? Are they entitled to compensation for loss of that opportunity? Alternatively, can they make a claim to the employment tribunal even though their claim relates to something which occurred 2, 3 or even 4 years’ ago on the basis that it was not ‘reasonably practicable’ to raise the claim earlier as a result of the unlawful fees regime?

What does all this mean?

So, what does all this mean? For a start, tribunals are already noticing an upturn in claims and ACAS has apparently reported more ‘bullish’ behaviour from potential claimants involved in the pre-claim stage of proceedings. It is clear that employers will have to pay close attention to workplace issues with a view to nipping in the bud any potential disputes. From a claimant perspective, it is clear that employment tribunals are immediately more accessible as a result of being free of charge, although the ACAS pre-claim protocol remains and almost all claimants need an EC (early conciliation) Certificate number in order to lodge their claim.

It is clear that the Government has its hands full at present with the Brexit negotiations. However, in time, it is expected that a new, more carefully thought through, fees regime will be introduced. Given the warnings contained in the Court’s decision, any such regime will have to ensure that the right of access to justice is protected. An announcement is expected over the next few weeks setting out how the tribunal service will deal with the issues thrown up by the decision. How long it will be before the Government is able to turn its attention to a renewed attempt to charge for use of the service is, for now, anyone’s guess.

 

Notes:

The case discussed above is R (on the application of UNISON) v Lord Chancellor [2017] UKSC 51.

The foregoing is not legal advice and should not be read as such. If you consider that you require legal advice as a result of what you have read, please let us know and we will put you in touch with an appropriate specialist.