Watch out – you may see more employment claims being brought by employees!

On 26 July 2017 the Supreme Court handed down a landmark judgment, finding that tribunal fees for those bringing employment tribunal claims are no longer lawful. 

Originally introduced by the government in 2013, fees of up to £1,200 were introduced in the hope that it would reduce the number of malicious and weak cases. The recent ruling by the Supreme Court found that the government was acting unlawfully and unconstitutionally in introducing these fees. In response, the government has said it will take immediate steps to stop charging employment tribunal fees.

Employees who have brought a case since July 2013 will have their fees refunded by the government, with the government expected to pay up to £32 million in refunds.

The introduction of employment tribunal fees coincided with a sharp drop in the number of cases being brought by employees, from approximately 13,500 individual claims per quarter prior to 2013 (before the fees were introduced), to an average of 4,400 claims per quarter once employment tribunal fees came into force. This drop was considerably higher than the government expected and was, in part, one of the reasons for the Supreme Court’s decision to drop the fees, realising that it was perhaps putting off genuine claims as opposed to simply deterring those without merit.

This drop in the number of cases brought following the introduction of the fees suggest that, following this ruling, we could well see an increase in the number of claims being brought by employees.

Although employees will no longer have to pay tribunal fees, they will of course still have to pay legal fees if they want legal representation. Only time will tell whether we do see an increase in the number of claims being brought. However, there could well be an increase in the number of claims being brought by individuals without representation (litigants in person), something which could potentially cost businesses thousands of pounds to defend.