Money for nothing – or how the Ministry of Injustice plans to leave employment tribunal claimants in dire straits.
Christmas came early to the CBI and its members, when on December 14th a jolly man at the Ministry of Justice – known to some as the justice minister, Jonathan Djanogly – added another sack load of presents to those left under the CBI’s tree by the kindly Business Secretary, Santa Cable, on 23 November. Santa Djanogly’s presents come wrapped in a consultation paper, so may not be opened until 2013 or even 2014. But the CBI’s members can now relax with a celebratory glass of sherry, warmed by the knowledge that they are getting just about everything they have ever wished for.
The employment tribunal issue and hearing fee levels set out in Santa Djanogly’s consultation paper are pretty much those predicted in a number of press and media reports over the past few months – if anything, they are even higher (see below). And, despite Santa Djanogly stating that his proposed fees regime is intended to put claimants on ‘broadly the same footing as [civil] courts users who already pay fees’, it is actually very different to that in the civil courts. Instead of a sliding scale of fees, with the fee level determined by the amount being claimed, under the ET fees regime the fee level is to be determined by the type of claim, based on the three ‘tracks’ into which HM Courts & Tribunals Service already allocates ET claims for the purposes of administration and listing cases.
So all Level 1/short track claims (e.g. unpaid wages, notice pay, holiday pay, or redundancy pay) will attract an issue fee of £150 and a hearing fee of £250, irrespective of how much the claim is for. Similarly, all Level 2/standard track claims (e.g. unfair dismissal) will attract an issue fee of £200 and a hearing fee of £1,000. And all Level 3/open track claims (e.g. discrimination, equal pay) will attract an issue fee of £250 and a hearing fee of £1,250.
This means that someone earning the national minimum wage and wanting to make a claim against their previous employer for, say, two weeks’ unpaid wages/notice pay/holiday pay – £500 – would face having to pay the same total amount in fees – £400 – as a city trader claiming £250,000 in unpaid notice pay. Call me socialist if you like, but that seems unfair, regressive, and wrong. The civil courts fees regime may be far from perfect, but at least those who stand to gain the most from using the courts pay a little more in fees than those who stand to recover only modest amounts.
Under the civil courts fees regime, the above worker on the national minimum wage and seeking to recover £500 would pay total fees of £105, whilst the city trader would pay £2,565. Which, on the face of it, would be a little fairer – though the worker on the NMW would still be gambling a (probably prohibitive) 21 per cent of their possible award in fees, and the city trader just one per cent.
Up, up and away
However, Santa Djanogly’s proposed fees regime is not only more regressive than the civil courts regime – it is also significantly heavier. Each year, Citizens Advice Bureaux deal with some 1,000 cases of an unpaid ET award. And, from research we conducted in 2008, we have a rough breakdown of these awards, both by amount and by type of claim. Applying the graduated civil courts fees regime, these 1,000 CAB clients would between them pay (not allowing for any remission) a total of £0.4 million in fees – and all for nothing. But under Santa Djanogly’s scheme, that sum would be £0.66 million. That’s a lot of money for nothing.
Richard Dunstan is a policy wonk who has worked for Citizens Advice, the National Audit Office, the Law Society, and Amnesty International UK.