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Employment law update: Supreme Court declares tribunal fees unlawful

On the 26th of July, the Supreme Court found in favour of trade union Unison in the case of R (on the application of Unison) v Lord Chancellor. The court declared that employment tribunal fees, first introduced by the Employment Tribunals and the Employment Appeal Tribunal Fees Order 2013, are unlawful and should no longer be charged. The government has also committed to reimbursing claimants for fees already paid, estimated to be up to £32m since they were introduced.

The Supreme Court’s unanimous decision found the Fees Order unlawful under both UK and EU law on the grounds that it had a real risk of preventing access to justice, undermining a fundamental aspect of the rule of law. It was found that this risk outweighed the legitimate purposes of the Fee Order to reduce the burden on the taxpayer. Furthermore, the Fee Order was not considered the least intrusive means possible of achieving the legitimate aims.

One of the other reasons given by the government for introducing the Fee Order was to discourage spurious claims, and indeed government statistics showed that 79% fewer cases were brought over three years. However, the court found that claims with merit might also be deterred by the higher price, and there was no correlation between the higher fee and the merits of the case or incentives to settle.

Finally, court also ruled that the Fee Order was indirectly discriminatory under the Equality Act 2010, as a higher proportion of the more expensive claims such as equal pay and discrimination are brought by women and other protected groups. In some cases, the higher fees did not even correspond to a higher workload on the Tribunal.

Charles Avens, Associate

 This briefing was posted on 2 August 2017.