The Supreme Court has held in R (on the application of UNISON) v Lord Chancellor that the order introducing employment tribunal fees prevented access to justice and discriminated against women. As such it was unlawful and had to be quashed.
In July 2013, the government introduced a Fees Order requiring an issue fee to be paid when a claimant wanted to lodge a claim form as well as a hearing fee prior to the claim being heard.
The amounts to be paid depended on whether the claim was being brought by a single claimant or a group, and whether it was classified as “type A” or “type B”. Type A claims generally required little or no pre-hearing work and very short hearings. All other claims were type B, including unfair dismissal, equal pay and discrimination claims. For a single claimant, the fees totalled £390 for a type A claim and £1,200 for a type B claim.
The Fees Order also made provision for the full or partial remission of fees if a claimant’s disposable capital, together with their partner’s, was below a specified amount (in most cases, £3,000). A fee could also be remitted if the Lord Chancellor was satisfied there were exceptional circumstances.
Arguing that the fees interfered with the right of access to justice under both common law and EU law (thereby frustrating the operation of Parliamentary legislation granting employment rights) and discriminated unlawfully against women, UNISON brought proceedings for judicial review. Rejected by the High Court and the Court of Appeal, UNISON pursued its claim before the Supreme Court.
Supreme Court decision
The Supreme Court emphasised the importance of access to the courts and its fundamental role in the rule of law with considerable force. Courts exist in order to ensure laws (whether Acts of Parliament or the common law) are applied and enforced, and to ensure the government carries out its functions within the law. Without unimpeded access to the courts, the Supreme Court unanimously held, “laws are liable to become a dead letter, the work done by Parliament may be rendered nugatory, and the democratic election of Members of Parliament may become a meaningless charade.”
According to the Supreme Court, the question as to whether the introduction of fees prevented access to justice had to be decided according to their likely impact on “behaviour in the real world”. If some low or middle-income households could only afford fees by forgoing an acceptable standard of living, they could not be regarded as affordable. As evidence on hypothetical claimants had shown they would have to restrict expenditure that they needed for maintaining living standards, the fees were therefore unlawful.
The Court stressed that the administration of justice is not merely a public service, where courts and tribunals are only of value to the “users” who appear before them and who obtain a remedy. They said access to justice is of value to society as a whole, especially where cases establish legal rules and principles of general importance.
Even in circumstances where the claimant could afford the fees, the Court held that they would still be deemed to prevent access to justice if it became “futile or irrational” for the worker to bring the claim. For instance, if the financial award was likely to be small or non-existent. In any event, the Court held that the Fees Order was unlawful because it contravened the EU law guarantee of an effective remedy before a tribunal.
Although the government’s aims in introducing the Order were legitimate (transfer part of the cost burden of tribunals from taxpayers to users, deter unmeritorious claims, and encourage earlier settlement), the Court held that it had failed to consider whether it would have been more proportionate to charge lower fees.
Finally, the Fees Order was indirectly discriminatory under the Equality Act 2010 because a higher proportion of women brought type B rather than type A claims. Charging higher fees was not a proportionate means of achieving the stated aims of the Fees Order as it had not been shown to be more effective at transferring the cost of the service from taxpayers to users, and in some type B cases (such as pregnancy dismissal) the higher fee did not correspond to a greater workload placed on the tribunal. Further, meritorious as well as unmeritorious claims might 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.
The Court unanimously allowed the appeal.
This is a fantastic victory for UNISON and all who believe that workers should have access to justice. The ruling marks the end of a four-year legal battle by UNISON to overturn the Tory and Lib Dem government's decision to impose fees on workers who wished to challenge their employer at an employment tribunal in England, Wales and Scotland.
As of 26 July 2017 no fees are payable. The Court quashed the Fees Order from the date it was first introduced in 2013. As a result the government has had to agree that it will reimburse the fees paid by claimants. It has said that it will put in place systems to reimburse the fees but the details of those systems are awaited. There remain unanswered questions until the government announces its proposals and systems. For example, if a claimant received a costs award against the respondent reimbursing them for a tribunal fee, will the claimant have to repay it? In such a scenario we believe it would be more efficient for the respondent to recover the fees directly from the government rather than from the claimant. If not, and the claimant has to reimburse the respondent then the claimant would in turn need to recover it from the government which simply adds another layer of bureaucracy. Watch this space for more updates once we know what the government intends to do.