Justice Committee calls for a ‘substantial cut’ in employment tribunal fees

After a long and tense wait, the House of Commons Justice Committee has finally delivered its verdict on the effect of fees on the court and tribunal system. In a damning indictment the Committee claimed the introduction of employment tribunal fees has had a ‘significant adverse impact’ on access to justice for justified claims.

As a result of the review, the House of Commons Justice Committee has urged the government to ‘substantially reduce’ the overall quantum of fees charged for bringing cases to employment tribunal. The group of MPs also asked for an increase in the threshold for fee remission and greater consideration for the position of women alleging discrimination because of maternity or pregnancy.

The long-awaited cross-party report also concluded that:

  • The research basis was insufficient to justify the MoJ’s fee proposals
  • Ministers should publish a review of employment tribunal fees immediately
  • The MoJ should rescind the increase in the divorce petition fee to £550
  • The £10,000 fee cap for money claims should not be changed unless the government has made a full impact review
  • Doubling of fees in the immigration and asylum chamber has caused ‘considerable concern and could potentially deny vulnerable people justice’.

The Committee heard evidence that since the introduction of issue fees and hearing fees for claimants in employment tribunals in July 2013, the number of cases brought has dropped by almost 70%. Comparisons showed that in the first 3 months of 2013 – before fees were introduced – and the first 3 months of 2015; sex discrimination cases were down by 68 per cent and equal pay claims fell by 58 per cent.

After hearing all of the evidence, the committee concluded that the introduction of fees, set at a level to recover or exceed the full cost of operation of the court, requires particular care and strong justification. The committee stressed it was not opposed to the principle of charging court fees to litigants, describing a degree of financial risk as an ‘important discipline’ for those contemplating legal action. But the debate over the level of fees – and the research conducted to justify them – was open to question.

Speaking about the report, Committee Chair, Bob Neill MP, said:

“Where there is conflict between the objectives of achieving full cost recovery and preserving access to justice, the latter must prevail.”

Mr Neill added that whilst he partially accepted the MoJ’s claims that changes to employment law and the improving economic system were the reasons for the decline in the number of claims; there was, in his opinion, ‘no doubt that the clear majority of the decline is attributable to fees’.

The committee’s report also criticised the unfair treatment of divorce fee petitions, claiming the raising of divorce fee petitions to £550 was around double the cost to the courts of providing the service and was ‘completely unjustified’. The report added:

“It cannot be right that a person bringing a divorce petition, in most cases a woman, is subject to what has been characterised in evidence to use as effectively a divorce tax.”

The Justice Select Committee said it was ‘unacceptable’ that ministers have yet to publish the results of a review into the effects of employment tribunal fees, six months after it was due to be released. The report noted a ‘troubling contrast’ between the speed with which the government introduced fees and its ‘tardiness’ in completing an assessment of the most controversial change made. [The report had been held back following evidence from justice minister Shailesh Vara in February, who said the government review would be published shortly. It was only following a letter from the MoJ in April that the committee realised it could not wait any longer.]

The Law Society welcomed the report, with President Jonathan Smithers saying:

“The Law Society and the solicitors’ profession have raised repeated concerns, in written submissions and oral evidence, now echoed by the Justice Select Committee, that punitive courts and tribunals fee increases are denying citizens and businesses the right to justice. The government must now heed the views of experts from across and beyond the legal profession.”

“We welcome and reiterate the committee’s unequivocal declaration that access to justice must prevail over generating revenue when the government is setting court and tribunal fees.’

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