Down down, deeper and down: the impact of employment tribunal fees on workers’ access to justice

By Richard Dunstan, Policy & Parliamentary Campaigns Officer

In early 2012, Working Families joined many other organisations – including the Equality & Human Rights Commission, Citizens Advice, Maternity Action and the TUC – in warning that the hefty, upfront fees for employment tribunal claimants on which the Ministry of Justice was then consulting would create a significant barrier to justice. In particular, we noted “an increase in the number of calls to our legal helpline about pregnancy discrimination”, and expressed our fear that fees of up to £1,200 would deter vulnerable women from bringing a tribunal claim for such unlawful discrimination.  But ministers were unswayed, and the fees regime came into force on 29 July 2013.

Last October, our fears appeared to have been realised when, in response to an ultimately unsuccessful legal challenge to the fees regime brought by trade union UNISON, the Ministry released provisional figures showing that the number of tribunal claims brought by individual workers had fallen from an average of 4,380 per month in the first half of 2013, to just 1,003 in September.

In rejecting UNISON’s legal challenge (on the basis that it was too early to reach a firm conclusion on the impact of the fees), the High Court judges noted that “if [these provisional figures] are anything like accurate, then the impact of the fees has been dramatic”.  And the judges suggested that, should the Lord Chancellor’s optimism that the number of claims would soon bounce back to more ‘normal’ levels prove unfounded, then they would “expect the Lord Chancellor to change the [fees regime] without any need for further litigation”.

Well, this morning the Ministry of Justice published tribunal statistics for the three-month period October to December 2013 (i.e. Quarter 3 of 2013/14).  These confirm that the provisional figures issued by the Ministry in October were indeed accurate, as they have not been significantly revised.  And they show that, following the dramatic fall in September, the number of claims by individual workers* picked up only a little in the following three months. There were just 1,618 claims by individual workers in October, 1,839 in November, and 1,504 in December – a total of 4,961.  As the following chart shows, compared to previous quarters the drop is startling.

Chart 1: single claims by individual workers, by quarter, April 2012 to December 2013 ET chart 13 03 14

In short, in Quarter 3 of 2013/14, the number of claims by individual workers was just 33 per cent what it was in the same quarter of 2012/13, and just 37 per cent of the average over the five quarters before the introduction of fees.  And the number of such claims in December 2013 was 35 per cent of the number in December 2012.  I think a High Court judge would call these figures dramatic, and UNISON was quick to call them “shocking”.

Given the evident increase in pregnancy discrimination in the workplace, it is particularly concerning that the number of sex discrimination claims (NB both individual and multiple claims) appears to have been especially affected, falling from 4,342 in Quarter 3 of 2012/13 to just 980 (22 per cent) in Quarter 3 of 2013/14.  As the TUC notes, this suggests that women have been “the main losers” from the introduction of fees.

Chart 2: discrimination claims (singles & multiples) chart discrimination claims

So, it would seem our fears about the impact of the fees on access to justice have been realised.  And, certainly, our legal helpline team has already dealt with several cases in which the adviser considers the client to have strong grounds to bring a tribunal claim, but the client has been deterred from doing so by the fees. Told by our adviser that her only option was to issue a tribunal claim, and what that would cost, one woman retorted: “I can’t afford that, I’ve just been on maternity leave!” Just last week, the BIS employment relations minister, Jenny Willott, noted that it “costs on average £1,800 to present a tribunal claim” for pregnancy discrimination, and that figure does not include the fees.

Ministers have argued that access to justice is protected for low-income claimants by the existence of a fees remission scheme.  However, put against the claims figures released today, the only figures on fee remission applications that the Ministry has been able or willing to release to date suggest that only about three per cent of all claimants obtain any fee remission.

So, will the Lord Chancellor, Chris Grayling, now reform the fees regime, for example by reducing claimant fees to a nominal level, as Working Families, Citizens Advice, the CBI and others suggested in 2012? That seems unlikely, at least for the time being.  I expect to see ministers expressing optimism that the slight increase in the number of individual claims in Quarter 3, compared to September’s stunning low, is a trend that is continuing, and will continue. And justice minister Shailesh Vara is reported by Personnel Today as saying:

“We think that the fees are not the only reason for the fall in the number of employment tribunal receipts; there has been a longer term downward trend as the economy has strengthened, and some of the big [multiple claim] cases involving airlines are now being concluded.”

However, as the following chart shows, the monthly figures for Quarter 3 are way below any marginal, long-term downward trend (the figures for July and August need to be ignored, as they were exceptional months, with a rush to get claims in before the fees came into force on 29 July followed by a compensatory fall in August).  And they don’t suggest a steady upward trend since October either.  At least, not yet.

Chart 3: single claims by individual workers, per month, July 2012 to December 2013 ET single claims, monthly 14 03 14

So, if the number of claims by individual workers does not pick up further in the next quarter (January to March 2014), then the Ministry of Justice is likely to come under intense pressure, not least through further legal challenges in the courts (including UNISON’s appeal). Those quarterly figures are due for release on 12 June.

Mark that date in your diary.

* Note that it is the number of single ET claims by individual workers that most matters here, not the overall (or total) number of claims.  For the latter includes all the multiple claimants in the relatively small number of multiple claim cases, which are much less affected by the fees regime, not least because the fees paid per multiple claim case are capped at six times the fee for a single claim regardless of the number of claimants in the case, which can be as many as several thousand.  And a typical multiple claim case is an equal pay claim brought against a public sector body by a trade union on behalf of hundreds of its members.  

For example, in September 2013 there were 1,003 single claims, and 114 multiple claim cases involving a total of 13,359 claimants; so the overall number of claims was 14,362.  But in April 2013, there were 4,509 single claims, and 404 multiple claim cases involving 5,109 claimants; so the overall number of claims was 9,618. The number and size of the relatively small number of multiple claim cases therefore distorts the overall number of claims in any one time period, and is a misleading measure of the employment tribunal system’s workload.

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8 thoughts on “Down down, deeper and down: the impact of employment tribunal fees on workers’ access to justice

  1. Interesting stuff. Very sad to see that new mothers are being discouraged from bringing claims. We used to receive quite a few speculative claims from people who were advised that the cost of defence meant they might get a settlement, despite their claim being flimsy at best. They previously had nothing at stake and fees seem to have reduced this. Discouraging these types of claim might mean that we should not be expecting to see the same level of claims as before fees. However, the system needs a better control against justified claimants being discouraged, such as the new mothers your blog highlights.

  2. I work as an Employment Law Specialist in a Citizens Advice Bureau and I have only dealt with one employment tribunal claim under the new system. In previous years I have dealt with thirty or so tribunal claims annually. The fee regime denies justice to employees who have been badly treated by their employers.

  3. I agree. I used to think that the system too easily allowed flimsy claims, with the employer often left with no real choice but to settle to avoid disproportionte legal costs. However, now i think that the pendulum has swung too far the other way..

  4. The stats show significant reductions in the different heads of discrimination claim, thereby supporting Unison’s assertion the principle of effectiveness is breached. You might think the solution is just for the the government to remove all fees for discrimination claims but it will then still have to measure whether there is an indirectly discriminatory effect on particular groups wanting to bring other heads of claim like unfair dismissal (a separate point of challenge Unison made in the High Court).

    Plus it’d be pretty unacceptable to retain fees for say an unfair dismissal claim unless there was a discrimination claim tagged on. I think this is or at least should be the end of the fees regime. Though I expect politically, they’ll probably revise rather than repeal it, at first anyway. Quite how they will be able to do this in any coherent or practical way I don’t know.

      1. It would indeed, but given the average time between the lodging of an ET claim and its outcome, it will be at least another three months before we can even begin to assess any impact on outcome. One to look out for when the next quarterly figures are published in June.

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