It’s been a year since the government introduced fees for workers making a claim to an employment tribunal. The most recent statistics show that this has led to an 81% decrease in cases. This has profoundly worrying consequences for the future of employment law. Workers who have been unfairly dismissed, subjected to unlawful discrimination, or who have simply not been paid for work they have done now have severely limited access to justice.
So why has the sudden drop happened? Have employment relations in the UK suddenly improved? No. The reason is simply that the vast majority of workers who find themselves in dispute with their employers (or ex-employers, since many claims relate to dismissal) can no longer afford to seek justice.
The coalition government introduced the fees regime largely thanks to unsubstantiated assertions that employment tribunals provided a charter for workers to make unmerited claims and vexatious appeals. The restriction of access to justice on the basis of ability to pay may seem like a contradiction in terms, and the level at which fees have been set is far higher than those for making a comparable claim in the County Court.
In order to even submit a form which enables a claim to be lodged in the system, a worker must now pay between £160 and £250 depending on the nature of the claim. If the claim goes to a hearing, the aggrieved worker must pay a further £230 or £950. This means that in order for many serious claims to be resolved, alleged victims must pay £1200 alongside any other related costs. It is hardly surprising that four out of five people now decide not to proceed.
Small claims caught
Our research with individuals who have sought help from Citizens Advice Bureaux with their work-related disputes tells us that many claims are for fairly small amounts – for unpaid wages or holiday pay that might amount to no more than £300. A simple financial calculation would dissuade anyone from pursuing claims like these, but to a worker on minimum wage taking home £250 a week, £300 is a lot of money.
Add to this another set of statistics from the government’s own research which shows that less than half of those given an award by a tribunal ever receive the full amount, while 35% get nothing at all. Indeed, given the high levels of stress endured by those who have tried to navigate their way through an already overly legalistic and complex system, it is hard to see why anyone would pursue a claim.
Even those who can afford lawyers’ fees for advice and representation find the process a difficult one. Imagine what it is like for workers without the support of a union or a lawyer, going up against skilled legal advisers in a tribunal which is their last resort. Even before the introduction of fees, they were likely to experience a number of barriers in attempting to recover pay or bring a bad employer to justice. For many such claimants the imposition of fees has been the final straw.
Given the dramatic effect of the fees, it’s worth looking again at where the original idea came from, as well as its underlying purpose. Although widely proclaimed as a means of reducing burdens on business and thus a necessary step towards economic recovery, the policy actually appears to have emerged as a means of enforcing an ideological position rather than a policy response to hard evidence.
In October 2011, George Osborne announced that the government intended to increase the qualifying period for claiming unfair dismissal from one year to two years, thus making it easier for employers to sack workers. In the same speech, the chancellor announced the introduction of a fees regime with the rationale being that it would become “much less risky for businesses to hire people”.
Despite having looked very closely at the tribunal system while tracking the experiences of many workers involved in disputes with their employers over the last two years, we have found no evidence of widespread abuse of the system. Except, that is, by employers who refuse to pay out on awards. In the post-fees environment, surely even the most committed neo-liberal would have difficulty in arguing that the 81% reduction in claims is linked to a fall in vexatious claims.
Introducing fees in order to take a legitimate grievance to a place of adjudication is bad enough. Worse is that it is only the worker who is required to pay a fee, and not the employer if they choose to defend their actions. This sends a message to employers that they can get away with behaving unlawfully towards their staff. There is no mechanism to dissuade them and there are now more barriers than ever in place for workers who wish to challenge treatment through tribunal system.
The legality of the fees regime is already being challenged through the courts by Unison in which the union argues that the imposition of fees amounts to a denial of access to justice for workers and has a disproportionate impact on women. A similar case raised by the law firm Fox and Partners is pending in Scotland.
However, simply turning the clock back to an era of pre-fees employment tribunals is not the answer. Tribunals were already failing to provide accessible justice for all and the potential costs had always been great. Workers faced a fear of being made to pay the employer’s costs; of intimidation tactics; and an apprehension about representing yourself in a daunting and unfamiliar process. Aside from the financial cost, the psychological and emotional damage left many in mental or physical ill-health.
Part of the problem relates to the move towards the individualisation of employment disputes which has been taking place for far longer than the coalition government has had its hands on the tribunal system. The solution must surely lie in looking for new models of collective action.
So rather than being confined to the narrow scope of the employment contract, the appropriate legal framework should be able to take account of the broader purpose of labour law: to redress the imbalance of power inherent in most working relationships which currently favours the employer. This is a call to arms for trade unions to find ways of supporting the most vulnerable workers in our society – such as those employed on zero-hours contract within the care sector – who too often work within organisations that are non-unionised.
As an important first step, advice agencies, trade unions and other community-based legal service providers need to pool resources and collect data which highlights the real life stories of individuals trapped in difficult workplace situations or cast aside by scurrilous employers now more certain than ever they will avoid a reckoning. It is only by joining up such evidence and assessing the very real damage that is being done to workers that it will be possible to reconstitute labour law’s democratic function, by which individual disputes once again become matters of public concern.
You can read the policy briefing on this topic.
This blog was first posted on The Conversation on Tuesday 29th July 2014.