On 18th April 2013, the Government published a consultation paper on fee remissions for the English Courts and Tribunals, including the Employment Tribunal.
Currently, a claimant can bring a claim or an appeal to the Employment Tribunal for free. The new fee structure, which will be rolled out in the summer, is a two-stage fee charging structure that requires claimants to pay an “Issue Fee” when they submit their claim to the Tribunal (£160 or £250 depending on the complexity of the claim) and a “Hearing Fee” (£230 or £950), which is payable prior to a Hearing. The aim of introducing fees is to try and encourage businesses and workers to mediate or settle a dispute, rather than go to a full Tribunal Hearing.
To protect claimants who cannot afford to pay any or part of these fees, the Government has proposed a two-stage test, based on the claimant’s disposable capital and monthly income, to determine whether any proportion of the fees should be remitted. The fee remission system is aimed at ensuring access to justice for those claimants who cannot afford to pay any or part of the new fees, and to standardise the approach to fee remissions throughout the Courts and Tribunals Service; whether it will achieve those objectives is questionable.
The first test to determine whether an applicant is eligible for a fee remission is based on an assessment of their household disposable capital, including savings, investments, stocks and shares, but excluding the claimant’s main residence and/or any pension fund. The amount of the fee determines the maximum disposable capital a claimant can hold before being considered eligible for a fee remission, for example the remission of any fee up to £1,000 would be limited to claimants (or potential claimants) with disposable capital of not more than £3,000.
If the claimant passes the first “disposable capital” test, the next test will consider whether they should receive a full waiver of the fee, make a contribution to the fee or pay the fee in full. The second stage of the test is based on the claimant’s household income. A claimant will be granted a full fee waiver where they can demonstrate that their household income is below a certain threshold. The cohabitation status of the claimant will be relevant to this assessment, as will whether they have any children.
With the impending introduction of the new two-stage fee charging structure later this summer, the Employment Tribunal has seen a marked increase in the number of claimants commencing proceedings ahead of its introduction. Far from discouraging employees from commencing proceedings, the changing fee structure is positively encouraging claimants to start their claim while it is still free to do so. While the Government consultation on fee remissions may offer some comfort to employees, the impending introduction of fees in the Employment Tribunals is already affecting employers.
If you would like any further information, please contact our Employment Team.