Government proposes to reintroduce employment tribunal fees

The UK Government is considering reinstating modest Employment Tribunal fees, aiming to cut taxpayer costs and promote early dispute resolution.

On 29 January 2024, the Government published its proposal to reintroduce ‘modest’ fees in the Employment Tribunal and Employment Appeal Tribunal. The aim of the proposal is to reduce costs to the taxpayer by requiring tribunal users to pay for the system where they can afford to do so. It is also hoped that the introduction of modest fees may help incentivise parties to settle their disputes early without the need for claims to be brought, thus also lessening some of the pressures that the Employment Tribunal is currently facing.

At present, there are no fees to bring Employment Tribunal or Employment Appeal Tribunal claims following a Supreme Court judgment ruling in 2017, which deemed the fees introduced by the coalition government in July 2013 to be unlawful. 

Proposed fee structure

The newly proposed fees are considerably less expensive than before, with a claimant paying £55 to issue any claim at the Employment Tribunal and an appellant paying the same amount in the Employment Appeal Tribunal. This is in comparison with the 2013 fees, which categorised claims as Type A and B. 

Type A claims covered simple disputes such as unpaid holiday pay and attracted an “issue fee” of £160 and a “hearing fee” of £230.

Type B claims were for more complex disputes, such as discrimination, with an issue fee of £250 and a hearing fee of £950. The Employment Appeal Tribunal attracted a £400 issue fee and a £1200 hearing fee. There are no hearing fees under the Government’s new proposal.

Exemptions and impact

There will be certain instances where the £55 will not be payable, such as for those who genuinely cannot afford the fees (as defined by the Government), and some very limited claims will be exempted, mainly claims against the national redundancy fund, and claims for failure to collectively consult in large scale redundancies.

Financial implications and timeline

Based on 2022-23 volumes, the Government estimates that the proposed fees could generate between £1.3 million and £1.7 million a year from 2025-26 onwards, with the intention being that fees will be implemented from November 2024 if the consultation is successful. The consultation remains open for responses until 25 March 2024.

For now, there is no change to the fee structure, and claimants can continue to submit claims to the Employment Tribunal and appellants to the Employment Appeal Tribunal for free. That being said, the proposal put forward by the Government is not, prima facie, an unreasonable one, and it is very possible that the modest fees will be introduced as a result. 

As soon as more information is received, an update will be provided.