To pay or not to pay?
There has been a lot of publicity recently around employment law and in particular the proposals to make changes to the Employment Tribunal system. This is all part of the Government’s Employment Law Review. One of the most significant changes to have taken place already is the increase in the qualifying period for unfair dismissal claims from 1 year to 2 years. Following on from this is the proposal to introduce fees in the Tribunal which is similar to the civil courts.
In a recent publication by the Ministry of Defence it has been confirmed that it is the Government’s intention to introduce fees by the end of 2013. Currently, it is estimated that the Tribunal system’s running costs
The present proposal is that fees will be charged in two stages. The first will be payable upon issuing a claim and the second prior to the hearing. The suggestion is that the fee structure will have two levels – Level 1 claims and Level 2 claims.
Level 1 claims are claims for specific, defined sums which would include unlawful deductions from wages, breach of contract and redundancy payments. The claim issue fee will be set at £160 and then a further fee of £230 to be paid at the hearing stage.
Level 2 claims will comprise of the more complex claims where the compensation claimed will not be for a defined sum. These claims include unfair dismissal, discrimination and equal pay. The claim issue fee for these claims will be £250 followed by a hearing fee of £950.
Are concerns that people on low incomes will be prevented from bringing their claims genuine concerns? Not necessarily. As with the civil courts remission system, the fees will be means tested and those on low incomes may be exempt from paying the fees.
How is mediation encouraged?
Mediation with the use of a qualified judge will cost £600 which is less than the £750 originally proposed. This is significantly less than the £1200 it will cost to pursue a level 2 claim to a full hearing. It is therefore hoped that those in dispute will use cheaper alternatives such as mediation to resolve their differences rather than head straight to the Tribunal.
It is expected that fees will be payable by those issuing the claims, albeit the Tribunal will have the power to order the unsuccessful party to pay the fees if they feel it is appropriate to do so.
It will be interesting to see whether as a result of the reforms there will be a significant drop in the number of claims issued, especially Level 2 claims, and a dramatic rise in the use of mediation. I guess only time will tell and we will need to wait until 2014 to see any real affect.
Bhayani Bracewell are employment law solicitors based in Sheffield and Doncaster.
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