UNISON Success In The Supreme Court Appeal Challenge To Employment Tribunal Fees
On 26th February 2016, the public services union UNISON was granted leave to appeal the Court of Appeal’s decision regarding a judicial review challenge to the Employment Tribunal Fees introduced in 2013.
The issue to be decided on appeal is whether the Court of Appeal erred in its approach to the EU principle of effectiveness; in its approach to indirect discrimination and in concluding that Fees Order was not indirectly discriminatory.
The Introduction of the Employment Tribunal Fees and their Impact
The Employment Tribunal fees were introduced on 29th July 2013. Claims are divided into Type A or Type B and the fees owed are based on which category an individual’s claim falls into.
Type A claims include:
- unpaid wages
- redundancy pay
- holiday pay
- notice pay
- equal pay (for claims presented before 6 April 2014).
Type B claims include:
- unfair dismissal
- equal pay (for claims presented on or after 6 April 2014).
For each claim, there will be two sets of fees to pay. These are:
- an issue fee
- a hearing fee
The fee structure is as follows:
Type A claims
Type B claims
The issue fees must be paid before an action is brought. If the claim goes to the Employment Tribunal, the hearing fee will need to be paid before the Tribunal meets to make a decision on the case in question.
If more than one claimant is making a claim, the fees will increase.
UNISON claims that since the fees were introduced, claims brought before the Employment Tribunal have dropped by 70 percent. People on low incomes or benefits can apply to have the fees waived, but this will occur only in exceptional circumstances.
The Court of Appeal Decision
In 2015, the Court of Appeal dismissed UNISON’s challenge as to the lawfulness of the Employment Tribunal’s fees.
In the high court, UNISON claimed that the fees denied claimants’ access to justice; however, this was dismissed by the high court because whilst the fee structure was still in its infancy, there was insufficient evidence available to support this assertion.
UNISON’s appeal to the Court of Appeal was on the following three grounds:
- The fees breached the principle that claimants should have access to justice. The organisation relied on the data showing the drastic drop in claims since the fees were introduced in 2013.
- The fees regime is indirectly discriminatory on the basis that claimants that wish to pursue a discrimination claim are required to pay a higher fee.
- The Lord Chancellor had breached his duty to have due regard to the need to eliminate discrimination by imposing the two-tier fees regime.
The Court of Appeal dismissed UNISON’s appeal on the grounds of lack of evidence to support the claim that the fees denied employees’ access to justice. In relation to the claims in respect of discrimination, the Court of Appeal held that the two-tier fees system was objectively justified. The higher fee in respect of discrimination claims reflected the greater demand such claims placed on the resources of the Tribunal.
The Breach of the Effectiveness Principle
In delivering the judgment of the Court of Appeal, Lord Justice Underhill stated:
“It is a principle of EU law, now embodied in Article 47 of the EU Charter, that persons who claim that their rights under EU law have been breached must have access to an effective remedy for that breach: otherwise, the rights in question would be illusory.”
Underhill LJ then went on to discuss the case of Podbielski and PPU Polpure v Poland (39199/98),  ECHR 543 and stated that this case established three points:
“(a) (unsurprisingly) that it is not objectionable in principle for the state to charge a fee for access to the courts;
(b) that there should be "a proper balance" between the right to charge such a fee and the right of a claimant to bring a claim before the court; and
(c) that the balance will not be properly struck if the fee is "disproportionate".
He then went on to observe that unfortunately Podbielski did not elaborate on what would amount to a ‘disproportionate fee’ in these circumstances.
The learned judge also noted that “The present proceedings do not, unlike the Strasbourg cases discussed above, involve a claim by a particular individual or individuals that their EU or Convention rights have been breached by their being unable to afford access to the Tribunals to prosecute a particular claim. Rather, Unison's challenge is to the lawfulness of the Fees Order itself. The question arises of how the criterion of realistic unaffordability falls to be applied in that context”.
Lord Justice Underhill’s Conclusion
Although Underhill LJ acknowledged that since the introduction of the fees in 2013, claims brought before the Employment Tribunal had dropped dramatically, “that by itself does not evidence or constitute a breach of the effectiveness principle”.
With regards to the drop in the number of claims, Underhill LJ stated, “In my view the case based on the overall decline in claims cannot succeed by itself. It needs to be accompanied by evidence of the actual affordability of the fees in the financial circumstances of (typical) individuals. Only evidence of this character will enable the Court to reach a reliable conclusion that that the fees payable under the Order will indeed be realistically unaffordable in some cases.”
However, he concluded, “I see no reason in principle why well-constructed cases of notional individuals could not be used to assist in proving that the fees would be realistically unaffordable for at least some typical claimants.”
With regards to challenging the fees on the grounds of discrimination, Underhill LJ concluded: “The decline in the number of claims in the Tribunals following the introduction of the Fees Order is sufficiently startling to merit a very full and careful analysis of its causes; and if there are good grounds for concluding that part of it is accounted for by claimants being realistically unable to afford to bring proceedings the level of fees and/or the remission criteria will need to be revisited.
However, the Court of Appeal was in the end, unconvinced that there was enough quality evidence of discrimination to grant relief.
The Supreme Court is due to hear the appeal in June 2016.
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