Fees introduced for Employment tribunal claims

ANY new employment tribunal claims issued after July 29 could now be subject to a fee. There are two types of fees payable: an issue fee (at the time of making the claim and submitting the ET1 form) and a hearing fee (in order to allow a tribunal hearing to be set).

There are two levels of claim and fees:

• Type A claims cover basic claims such as unlawful deduction of wages, holiday pay etc. These claims have an issue fee of £160 and a hearing fee of £250

• Most claims will fall into type B, such as unfair dismissal. Type B claims have an issue fee of £230 and a hearing fee of £950

Those who cannot afford the fees can apply for a full fee remission. The government has three tests that are used, with the applicant having to satisfy one of the following:

• Gross annual income below a certain level

• In receipt of certain benefits

• Full or part remission based on disposable monthly income

The introduction of fees is currently being challenged in court by Unison in England and Fox and Partners in Scotland so there may be further changes ahead.

Details of the new government fee scheme can be found here.

Time will tell whether the introduction of fees has any impact on the number of tribunal claims received. Employers will also need to consider costs involved as it will be down to them to pay the £600 fee for mediation in order to settle the case before a tribunal.

In other news involving tribunals, the government has introduced a cap on the compensatory award amount an individual can be given at a tribunal for an unfair dismissal claim. The cap is now 12 months’ pay and will apply where this amount is less than the overall cap, currently £74,200.

This change is a significant move in favour of employers in that they will now have an idea how much a successful applicant may be awarded for an unfair dismissal claim and can weigh up the financial impact on the case and whether it would be more cost effective to settle the claim or fight it.

Other changes that have been introduced include combining pre-hearing reviews and case management discussions into a preliminary hearing, powers for judges to strike out weak cases and a requirement that a tribunal must, where appropriate, encourage both parties to use alternative dispute resolution like mediation and early ACAS involvement.