Employment tribunal fees: All you need is Gove

With almost four months having passed since Ministry of Injustice officials dumped their ET fees review report in the intray of the nation’s slowest reader – junior injustice minister Shailesh Vara MP – and two months having passed since the justice select committee of MPs took oral evidence on the issue*, it is perhaps not too ridiculous to expect an announcement by everyone’s favourite justice secretary, Michael Gove, reasonably soon. But what kind of announcement will it be?

For those of us hoping Gove will substantially reduce or even scrap the fees introduced by Coalition ministers in July 2013, there was some bad news this week from the Institute for Government. The Institute’s wonks have been pouring over the detailed departmental spending figures that the Government publishes quarterly, and comparing these against each department’s spending plans for the year. And they’ve found that the Ministry of Injustice is “worryingly off target”.

[The Ministry of Injustice] has seen a 3.1% fall in its day-to-day spending compared to 2014/15, which sounds rather good (at least from a fiscal hawk’s point of view). However, the department needs to cut its spending by over 12% this year to meet the Government’s plans. So it looks as though [the Ministry] has a lot of catching up to do in the second half of the year. And that is unlikely to be the end of the story – this is a department with one of the toughest settlements in the recent spending review.

In other words, the Ministry is not exactly well placed to take the £20m a year hit that would come with full abolition of ET fees.

However, Gove must be under considerable pressure to do at least something on ET fees. Apart from the pending justice select committee report, and the Ministry’s bulging file of my blog posts, it is surely no coincidence that the Department for Business, Innovation & Skills (BIS) and the Equality & Human Rights Commission (EHRC) have yet to publish the long overdue final reports of their joint investigation of pregnancy and maternity discrimination in the workplace. Those final reports, originally scheduled for publication last autumn, include policy recommendations by the EHRC, and I will be astonished if they don’t highlight the detrimental impact of ET fees on women’s access to justice.

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So, we have to hope that Gove is at least looking at a substantial reduction in the level of the fees. And that he has been reading up on past policy statements by employer bodies such as the British Chambers of Commerce, which in July 2012 suggested it would “make sense to fine non-compliant employers an automatic small administration fee, aligned with the [claimant issue] fee”. This is not dissimilar to my own, January 2012 proposal for a ‘polluter pays’ financial penalty for those employers found by a tribunal to have breached the law – that is, those employers that create the need for an employment tribunal system. In March last year, I noted that:

Each year, about 12 per cent of all claims are successful at a hearing or result in a default judgement in favour of the claimant. And, if claim/case numbers [were to rise] to just below their 2012-13 level [thanks to a substantial lowering of claimant fee levels], there would be about 6,500 losing employers. Imposing a penalty of £1,000 on each of those losing employers – a hefty sum, for sure, but still less than the £1,200 some claimants have to pay in fees now – would generate an annual income of £6.5 million.

Were Gove to combine such a ‘polluter pays’ financial penalty with a modest (or nominal) fee for employers to defend a tribunal claim – and why shouldn’t employers pay to use the tribunal system? – he would give himself the financial space he needs to reduce claimant fees to a modest (or, ideally, nominal), level.

But first, Shailesh Vara has to finish reading that review report. Do hurry up, Mr Vara!

[* Since writing this post, I see the justice select committee is taking further oral evidence on (court and) ET fees, from the senior judiciary. So, the committee’s report may still be some way off.]

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About wonkypolicywonk

@wonkypolicywonk is a policy minion who has been lucky enough to work at Maternity Action, Working Families, Citizens Advice, the National Audit Office, the Law Society, and Amnesty International UK. He currently bangs his head on a desk in Parliament.
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