UK Supreme Court Finds Court Fees Levied by Employment Tribunal Fees Illegal and Constitute Discrimination

The highest court in the United Kingdom recently ruled that the fees workers were required to pay to bring employment claims before employment tribunals in the United Kingdom are illegal. In its July 26, 2017, unanimous judgment, a panel of seven justices of the UK Supreme Court held that the fees the government had mandated in 2013 are unlawful barriers that denied workers fair access to justice under both United Kingdom and European Union law.

The challenge to the employment tribunal fees was brought by Unison, a large public service trade union in the United Kingdom. The lower courts had upheld the fees. Unison successfully appealed to the UK Supreme Court in London.

Court Fees Were Assessed Beginning in 2013 for Employment Claims in the United Kingdom

Before July 2013, a worker was not required to pay any fees to bring employment claims before a UK employment tribunal. After the government imposed the employment tribunal fees in July 2013, however, workers had to pay fees ranging from £390 ($508) to £1,200 ($1,565) depending on the type of employment claim. The fees charged for employment discrimination and wrongful termination claims (in the United Kingdom, called unfair dismissal claims) were at the upper end of the range. The government introduced these fees in the belief that it would cut down on the filing of meritless cases.

Court Fees Imposed in 2013 Led to a 70% Drop in Employment Claims

After the fees were imposed, the number of employment claims cases before employment tribunals dropped precipitously. A United Kingdom government report found a 70 percent decrease in the number of cases. The Supreme Court of the United Kingdom found that the fees served as discrimination against women in particular because women were filing a higher proportion of employment discrimination cases.

The Supreme Court of the United Kingdom stated that court fees are not prohibited, but the law guaranteed access to the courts. The court found that the employment tribunal fees unlawfully impeded a worker’s access to the courts and that “[a] significant number of people…have found the fees to be unaffordable.”

Court Fees Dropped in July 2017 for Employment Claims and Refunds Underway

As a result of the ruling, the government of the United Kingdom immediately stopped collecting employment tribunal fees. And now the government must refund up to £32 million ($41.75 million) in fees to thousands of claimants, dating back to July 2013. Lawyers (known as solicitors in the United Kingdom) believe that without the required payment of fees, the number of employment claims filed by workers probably will increase significantly over time.

Court Fees in the United States Are Also High

Initiating an employment claim in the United States for employment discrimination, overtime pay, breach of contract, or wrongful termination requires that the claimant pay administrative fees. In the Dallas County civil courts, for example, a single plaintiff is required to pay an initial filing fee of $287. There are usually additional fees, as well. The initial filing fee for a civil lawsuit in federal court in the Northern District of Texas is $400. An indigent person, however, can file a detailed, sworn application with the court to be allowed to proceed without prepayment of the court fees.

Mandatory Arbitration Clauses in Employment Contracts Add to the Cost

Many employers require their employees to execute employment contracts that contain mandatory arbitration clauses. Instead of filing an employment claim in state court or federal court, the claimant must file the claim with an arbitration provider. The arbitration provider is usually a private or not-for-profit organization. Arbitration, unlike a court proceeding, is private. The public may not have access to arbitration filings, proceedings or awards. This appeals to employers because of the privacy and secrecy shrouding an arbitration proceeding. Furthermore, arbitration may cost more to workers than proceeding in court. To learn more about arbitration, click here Employers Use Arbitration.

The Cost of Arbitrations in Texas

In Texas, arbitration can be quite costly for a claimant. The mere filing of a claim in arbitration can cost well over $1,000 in administrative fees. Depending on the arbitration provider and the arbitration clause in the employment contract, the claimant may also be responsible for additional fees. Sometimes, claimants argue in court that the fees associated with arbitration deny them access to justice, but usually this argument fails. Courts in Texas typically order arbitration if the legal prerequisites for arbitration have been met.

Do I File an Employment Claim in Court or in Arbitration?

If you have an employment claim but are uncertain if it should be filed in court or in arbitration, then you should contact an employment attorney at Kilgore & Kilgore to discuss the facts of your particular situation. Please click here the get started with a free evaluation of the facts of your case Contact Kilgore & Kilgore.

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