Charging Fees in Employment Tribunals and the ... - Ministry of Justice

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Charging Fees in Employment Tribunals and the Employment Appeal Tribunal Summary ofresponsesPart C – Responses related to Option 2182. Option 2 offered an alternative fee proposal. Both Options had the primaryobjective of transferring some of the financial burden from the taxpayer to theuser. The additional policy aims of Option 2 were to:provide business with greater certainty over their maximum liability ofaward by asking claimants to specify if their claim is above or below athreshold amount; andencourage claimants to make a more informed judgement about thevalue of their claim and hence narrow the gap between an individual’sexpectation of what they can ‘win’ and their actual entitlement, leadingto a more satisfactory outcome for claimants and respondents.183. It was proposed that these aims were to be achieved through requiringclaimants to pay a higher fee if they sought an award over a specified threshold(proposed at £30,000 in the consultation). This would have required theclaimant at the outset of making a claim to identify whether to seek an awardabove or below this threshold. If the claimant chose to pay the lower fee thenthe tribunal would be prevented from awarding above the threshold amount,regardless of whether they considered that the claimant was entitled to ahigher amount.184. This approach acted as an effective cap on the amount awarded where theclaimant chose to pay the lower fee. This would enable business to know thattheir maximum liability is £29,999 where an award was made against them.185. Option 2 proposed a single fee at issue with four fee levels. The first threelevels were based on the type of claim made but where the claimant seeks anaward above a particular threshold, proposed in the consultation at £30,000 ormore, then the Level 4 fee would be payable, irrespective of the type of claimmade. It was further proposed that if the level 4 fee had not been paid then theTribunal would be restricted to making an award up to the level of the thresholdand not over it.186. The following questions related to those aspects that only applied to the Option2 fee structure.Question 16 – Do you prefer the wider aims of the Option 2 fee structure?Please give reasons for your answer.187. Around 20% of 123 replies to this question were in agreement. A small majorityof business respondents agreed with the additional aims and a significantminority of legal respondents agreed, but claimant, Trade Union and equalitygroups were exclusively against the wider aims, mainly due to the means bywhich the Government intended to achieve them. For example, TUC said:The TUC does not dispute the objectives. However, we donot believe that the proposed threshold contained in Option44
Charging Fees in Employment Tribunals and the Employment Appeal Tribunal Summary ofresponses2 represents an effective or proportionate means ofachieving these aims.Option 2 also seeks to transfer an increased proportion ofthe costs from the taxpayer on to individuals who areseeking to challenge long standing discrimination in theworkplace and whose claims amount to £30,000 or more.We are concerned that this sends a signal that theprevention of discrimination is not considered to be apriority for this government.188. Other comments by those who did not support the aims were:The advantage of giving business more certainty over the maximumliability of an award can be overcome by ensuring that this informationis provided on the Form ET1. The proposals in Option 1 are sufficientto ensure that claimants think carefully about the merits of their claim attwo distinct stages of the process.The consultation paper notes that fewer than 7% of all tribunal claimsresult in awards in excess of £30,000. Thus the proposed threshold islikely to have a relatively small impact towards providing greatercertainty for business over potential liabilities and expectations in somecases over the potential value of claims.There are better ways of addressing unrealistic expectations, inparticular using advice services and advisers who can assist claimantsto realistically calculate the value of their claim. In this respect the GMBbelieves that the Government should reverse the funding cuts for legalassistance for employment rights that impact on providers such asCitizen’s Advice Bureau, Law Centres etc.It risks either claimants artificially inflating their claims so as not to limitthe possible compensation once a proper assessment can be carriedout, or artificially deflating their claims to avoid higher fees but then beunable to get a just and equitable level of compensation if their case issuccessful.It would be very difficult to assess the value of the claim at the outset asa number of factors determining the level of the award are out of thecontrol of the claimant e.g. when the hearing takes place, when theclaimant will find further work etcQuestion 21 – Do you agree that Option 2 would be an effective means ofproviding business with more certainty and in helping manage the realisticexpectations of claimants?189. In terms of whether the Option 2 proposals generally would meet the statedaims of improving business certainty and claimant expectations, a majority ofall groups (including business groups) say it will not. It ought to be noted,however, that respondents were considering the Option 2 proposal as a whole45
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