IoD Criticises Flawed Employment Tribunal Fee Proposals

Published on Tuesday, 06 March 2012 11:03
Posted by Scott Buckler

Responding to the Government’s consultation, Charging Fees in Employment Tribunals and the Employment Appeal Tribunal, which closes today (6th March), the Institute of Directors has forcefully warned that current proposals will not do enough to counter weak and vexatious employment tribunal claims

The IoD supports the Government’s intention to introduce fees to deter baseless claims. Too many litigants simply put in a tribunal claim because there is no cost to them, little downside and potentially much to be gained from doing so – even if there is no merit to the claim. For employers on the other hand, the potential cost and the time involved in dealing with a case, even one which is clearly vexatious, can be prohibitive.

However, the IoD is concerned at proposals to exempt most claimants from paying the full fee, particularly those on certain benefits, including Jobseekers Allowance. This could cover the great majority of those who have lost their job and are making a claim for unfair dismissal. The Government’s Impact Assessment estimates that 77% of claimants would be eligible for full or partial remission. Such a high level of exemptions would totally undermine the deterrent effect of the fees.

To address this flaw in the proposals, there needs to be some element of means-testing involved for anyone applying for remission of tribunal fees.

Simon Walker, Director General of the IoD, said:

The Government estimates that three-quarters of claimants will find themselves partially or totally exempt from tribunal fees. This proportion is much too high. The great majority of those claiming unfair dismissal are likely to be unemployed, so exempting claimants from fees on this ground alone is clearly not sensible.

“If tribunal fees are to act as a reasonable deterrent they should only be remitted to those who truly cannot afford them. At the moment a couple with an income of £40,000 or even more could be totally exempt from paying an employment tribunal fee, which is absurd.”


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