New tribunal fees to place additional burden on employers

Employers could face increased costs and more drawn out tribunal proceedings following plans to introduce new fees for tribunal claims, according to employment specialists at Black Country law firm George Green LLP. 

Under plans announced by the Government to make sure that the users of tribunal services bear some of the costs of providing that service, employees looking to make a claim against their employer from summer 2013 will be asked to pay two sets of fees: an issue fee of £160 or £250 at the commencement of their case and a hearing fee of £230 or £950 should the case proceed to a full tribunal hearing. 

The lower, level-one fees apply to relatively straight-forward claims such as unpaid wages, redundancy payments and notice pay while the higher, level-two fees will apply to more complicated claims such as unfair dismissal, discrimination and whistle-blowing. 

Tim Lang, partner at George Green LLP, said:  “While the introduction of fees could act as a deterrent for employees considering weak or vexatious claims, judges will have the discretionary power to order the employer to reimburse any fees incurred if the claim is successful and are likely to do so in most cases in my view.  

“Special dispensation is also likely to be in place for claimants on low or no incomes and this could reduce the incentive for claimants to find alternative employment while a case is progressing, leaving employers potentially liable for larger claims relating to loss of earnings.” 

While the issue fee is paid at the start of the process, the second ‘hearing’ fee is not due until four to six weeks before any tribunal hearing, creating a two-stage process. 

Tim continued: “The two-stage process was intended to allow time for employers and employees to reach agreement and avoid full tribunal hearings where possible but the net effect may be the opposite. 

“The two-stage fees may create a more drawn out legal process, with employers waiting to see if employees can find the money to pay the fees before making settlement offers and claimants being less likely to consider these offers once they’ve ‘paid’ for their case to be heard at the tribunal. 

“While the detailed provisions are still to be finalised, the changes are likely to lead to new tribunal tactics being employed by both claimants and defendants. Employers aware of potential claims should seek advice at the earliest opportunity.”