An end to tribunal fees - The repercussions for employers

Between 2013 and July 2017, employees had to pay a fee if they wanted to take a case to tribunal.  Now that this fee has been abolished, Reggie Lloyd looks at the implications for employers and asks whether the number of claims will rise.  

On 29 July 2013, a ruling was introduced that meant every employee making a claim in the employment tribunal had to pay a fee when they lodged their claim, and a further ‘hearing’ fee if the case was not resolved before it was heard.

These fees were abolished on 26 July 2017 by the Supreme Court, which declared that the regime was unlawful.  The Court said that the imposition of fees effectively prevented access to justice and was in breach of common law and constitutional rights, was indirectly discriminatory under the Equality Act, and was contrary to EU law as it imposed disproportionate limitations on EU derived rights.

Now the fees regime has been abolished, claimants who paid these fees can reclaim them from the tribunal.  Where respondents or employers were ordered to pay claimants’ fees by the tribunal, they too will be able to seek reimbursement.

When fees were introduced back in 2013, there was a reduction of approximately 75% in claims lodged in the tribunal; since fee abolition in July, unsurprisingly, a sharp increase has been reported in claims being lodged.  

Generally, claims must be presented to the tribunal within three months of the event in question.  A worrying aspect for employers is that any claimant who lodged a claim on or after 29 July 2013, and whose claim was not accepted because they did not pay the fee, will be able to resurrect their claim.  It is also possible that an employee who considered making a claim between 29 July 2013 and 26 July 2017, but was deterred because of the requirement to pay fees, could present that claim now, even though it could be up to five years old.  In such instances, however, the tribunal would have to determine whether or not the claim can proceed; that would be dependent upon the facts and circumstances of each case and, in particular, the reason the employee did not lodge the claim at the time.

The biggest difficulty for employers facing old claims is that they may be disadvantaged if the manager, HR officer, dismissing officer and/or witnesses - or other people involved in the case - have since left the company.  In these circumstances the tribunal would have to decide if a fair trial is still possible.

The abolition of fees undoubtedly makes it much more attractive for employees to pursue a claim.  It is still the case, however, that an employee must engage in ACAS early conciliation before a claim can be issued.  Perhaps the perceived ‘barrier’ of early conciliation is an indicator that the amount of claims issued is unlikely to increase to the pre-July 2013 level.  Either way, employers need to be aware that they are much more likely to have to deal with a claim than they have been over the past five years.

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The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.