MOJ to undertake a review into Employment Tribunal Fees

According to Hansard:

Employment Tribunals Service

Question

Asked by Baroness Drake

To ask Her Majesty’s Government what plans they have to lower the level of fees for access to employment tribunals.[HL302]

The Minister of State, Ministry of Justice (Lord Faulks) (Con): The Justice Secretary is committed to reviewing the impact of the introduction of fees in the employment tribunal system. The Ministry of Justice is currently finalising arrangements for the timing and scope of the review to ensure that the impacts can be properly assessed. An announcement will be made when the review begins, and again when it has been completed, setting out the results.

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The Small Business, Enterprise and Employment Bill 2014 published

The Small Business, Enterprise and Employment Bill 2014 Published

The Small Business, Enterprise and Employment Bill has been published today. It contains the following…

First, under clause 136, a new system for enforcing tribunal awards: an ‘enforcement officer’ will give a 28-day warning notice if a tribunal award remains unpaid. If the monies are not then paid by the Respondent, a ‘penalty notice’ will be issued. The penalty is 50% of the outstanding amount, subject to a minimum of £100 and a maximum of £5,000. If the full sum, and the penalty, are then paid within 14 days, the penalty is reduced by 50%. The penalty is payable to the Secretary of State, not the Claimant.

Second, details of the ‘outlawing zero hour contracts’, announced earlier today. Clause 139 of the Bill provides a definition of a zero-hour contract, and renders any clause which tries to stop the worker working for somebody else void.

Third, a power to amend the employment tribunal procedural rules to limit the number of postponements available to a party (clause 137), and an obligation on the tribunal to consider making a costs award if the postponement application is a late one (the concept of what a late postponement is will be set in secondary legislation).

Fourth, a power to allow the Treasury to require repayment of some or all of a termination payment in a public sector exit (clauses 140-142). All the details will appear in secondary legislation.

Fifth, under clause 135, a framework requiring prescribed persons under the whistleblowing legislation to publish details of disclosures made to them (this is subject to detailed secondary legislation, not yet published).
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Exclusivity clauses in zero-hours contracts to be banned

The Government has now responded to its consultation on the use of zero-hours contracts. This states that the Government will ban the use of exclusivity clauses and increase the availability of information on zero-hours contracts for employees. The Government will also work with unions and business to develop a best practice code of conduct aimed at employers who wish to use zero-hours contracts.

The ban on exclusivity clauses will form part of the Small Business, Enterprise and Employment Bill. The Government states that 83% of the responses to the consultation were in favour of the ban. The Business Secretary, Vince Cable, has also announced that the Government will:

  • issue a further consultation on how to prevent ‘rogue employers’ evading the exclusivity ban by, for example, offering one-hour fixed contracts
  • work with business representatives and unions to develop a code of practice on the fair use of zero-hours contracts by the end of 2014, and
  • work with stakeholders to review existing guidance and improve information available to employees and employers on using these contracts.

The Government response is in the unusual form of a statement of the consultation’s outcome and a link to a press release. This may be partly due to the extremely high number of responses, over 36,000, of which 35,000 were as a result of a campaign run by 38 Degrees. By way of contrast, a consultation on what could be said to be a more controversial topic – the introduction of employment tribunal and EAT fees ­– got fewer than 150 responses.

 

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Employment Tribunal Claims Continue to Decline

The number of employment tribunal claims has plummeted by around 80% for the second consecutive quarter, following the introduction of fees, official figures revealed today.

Claims dropped 81% between January to March 2014 to 6,019, compared with the same quarter in 2012/13, according to government statistics. In the last quarter of 2013 claims fell by 79%, compared with the last quarter of 2012.

Trade union Unison said today’s statistics ‘add significant weight to the union’s arguments that workers are being priced out of justice’.

Unison has been granted permission to appeal the High Court’s rejection of its judicial review challenging the introduction of tribunal fees.

The JR was dismissed in February on the basis that there was no quantifiable evidence at that point to assess the impact of the fees.

Dave Prentis (pictured), general secretary of Unison, said: ‘This downward spiral in the number of employment tribunal cases shows only too clearly that workers are being priced out of a fair hearing.

He said: ‘Today’s figures make shocking reading because individual claims are now at a perilously low level.’

Tribunal fees were introduced on 29 July 2013 and start at around £160 to issue a claim, rising to £250 a claim, depending on the type, and a further hearing fee ranging from £230 to £950.

Richard Fox, head of employment law at London firm Kingsley Napley, described the fall in claims as ‘drastic’ and ‘way outside government expectations when the fees regime was first introduced last July’. He said that Unison may be able to use the statistics in its judicial review challenge.

It is unclear what the overall fall in employment disputes is, as some claimants in employment cases are turning to county courts instead. Former tribunals president David Latham told the Gazette last week: ‘A lot of cases are going through the county courts as the fees are much cheaper, so we don’t know what the figure is.’

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BIS Survey of ET Applications

BIS had today published its findings from the Survey of Employent Tribunal applications. About 2000 employee sand 200 employers were interviewed. Here are some of the key findings:

  • 79% of small employers had not been involved with a tribunal claim over the last two years
  • although the employees surveyed issued their claims before fees were introduced, 49% said that paying an issue fee would have influenced their decision to issue proceedings (mainly those with lower salaries or unlawful deductions claims)
  • 67% of employers use a representative at the hearing, whereas only 33% of Claimants use a representative
  • 79% of cases in which an offer was made resulted in settlement. The opening offer was made by the employer (rather than employee) 61% of the time
  • 17% of claims went to a full hearing (remember this is cases issued before fees were introduced)
  • the median tribunal award was £3,000, and the median level of expected award (by Claimants) was £4,000
  • 87% of employers said the award had been paid, whereas just 63% of Claimants said they had received the money of those who paid for legal or professional advice, the median amount paid was £3,000
  • 72% of claims were against private sector employers (broadly similar to the 69% of people who work in the private sector).
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