Our thoughts on the world of employment law - and beyond.

Third time lucky? Unison loses its High Court bid to overturn employment tribunal fees

Unison’s second application for a review of the tribunal fees regime was rejected by the High Court this morning.  An earlier application had also been turned down, with the High Court calling it “premature”, claiming it was too early to judge how the tribunal fees system would work in practice. Lord Justice Elias gave the leading judgment in the second application and whilst the decision is perhaps surprising in the light of the facts, when one looks at the specific evidential tests one can see why the conclusion was reached.

Unison was granted a second review earlier this year given the steep fall in claims that have been brought to tribunal since the new regime was introduced. Before fees came into the equation, an average of 48,000 new claims were lodged in the tribunals each quarter. The most recent figures for July to September 2014 show only 13,612 new claims  – 66% fewer than the number of claims lodged in the same period last year.

The scheme was challenged on two grounds. Firstly, it was claimed to be unlawful under the EU principle of effectiveness, with Unison arguing that it was virtually impossible or exceptionally difficult for potential applicants to bring a claim – the enforcement of Convention rights must be practical and effective rather than theoretical or illusory. Secondly, the scheme was said to be indirectly discriminatory. Unison had for this application assembled a strong body of evidence on how tribunal fees had an adverse impact on women, the low-paid, disabled people and those from ethnic minorities. However, the judges reviewing the case claimed that there was limited case law relating to circumstances where the cost of litigation “had the effect of denying the claimant an effective remedy”.  In other words, relying simply on overall statistics was insufficient – evidence of real individual cases of harm and detriment was the key.  A link to the judgment can be found here.

The judgment states “I would anticipate that if the statistics upon which reliance is placed in support of this application were drilled down to some individual cases, situations would be revealed that showed an inability on the part of some people to proceed before an Employment Tribunal through lack of funds which would not have been the case before the new regime was set in place.” The judge went on to say “however, that assessment has to be seen as speculative until convincing evidence to that effect is uncovered.”  Most commentators find it hard to see how the figures suggest a ‘speculative’ connection and on the facts, the rationale for the decision is surprising. But Unison have already been given leave to appeal and indicated an intention to do so, and it seems very likely that the third round will involve evidence from an actual disadvantaged claimant, showing the impact of fees on access to justice on an individual level.  At that stage, it may well be that things change.

Shadow business secretary Chuka Umunna has indicated that Labour will in any event review the fees regime should it win the next election.  Others have contrasted the government’s swift action to introduce an (employer-led) task force pretty much the same day the holiday pay decision was published last month, set against its  continued refusal to review the impact of the employment tribunal fees system despite the seemingly overwhelming body of statistical evidence pointing towards a need for reassessment.

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