Employment Tribunal Fees

Ian Lavery Excerpts

Tuesday 1st December 2015 Westminster Hall

[Justin Madders (Ellesmere Port and Neston) (Lab)]

I beg to move,

That this House has considered the effect of the introduction of fees for employment tribunals.

It is a pleasure to serve under your chairmanship, Mr Streeter. An essential part of any democracy is an economy that works for the whole population. That means there should be not only full employment, or as close to that as can be managed, but opportunities for everyone to make the most of that economy. There should be no glass ceilings. People from different backgrounds should all have the same chance of making it into their chosen job. Crucially, in the context of this debate, an individual should have the security of knowing that if things go wrong, they have a realistic avenue through which to seek redress.

To my mind, we have a system in place that puts security near the bottom of the pile in terms of priorities. Security should be the cornerstone of any settlement on how the workplace operates. No matter how imperfect the current system is, if there are workplace rights and protections that this place has deemed a necessary part of the social contract between Government and the country, we should be absolutely sure that those rights can be genuinely enforced, if we are not to have an illusory scheme of protection.

The employment tribunal system has a social benefit for everyone and should therefore be accessible to all members of society. It is worth reminding ourselves that tribunals took on their present character as employment courts to resolve disputes between employers and workers in 1971, as part of that year’s Industrial Relations Act, largely arising from the recognition that unresolved workplace grievances had led to a proliferation of official and unofficial industrial action. Those origins should serve as a clear warning that if we are to live in a just society, we need an accessible and fair system for resolving disputes.

[Ian Lavery (Wansbeck) (Lab)]

I congratulate my hon. Friend on bringing this important issue to the Chamber. Does he agree that the introduction of these fees disproportionately affects women, particularly those who are pregnant or in part-time employment? That issue must be addressed.

[Justin Madders]

I thank my hon. Friend for his intervention. I will address later some of the disproportionate impacts of the fees, but they are part of a bigger picture: they are part of a sustained attack on working people in this country. A lot of the legislation in the previous Parliament and currently going through the House is nothing more than an attack on basic workplace rights and protections. If our ambition is to have an economy and country where everyone has a stake in their prosperity, we should value the security and sustainability of jobs as much as the means of creating them.

It is widely recognised that losing a job is one of the major occasions in life on which people face extreme pressure and stress. Obviously, it is not quite as significant as some other issues, but for many, it can be a pretty traumatic experience. It can affect a person’s marriage, health, home, finances and, of course, family, yet we seem to be fostering a culture in which an individual is considered a disposable item to be cast aside with barely a second thought. While that culture exists, it is important that we have strong protections in place and—this relates to today’s debate—an effective and accessible system enforcing those protections.

Let us look first at the stark data, which show that the number of tribunal claims lodged has fallen off a cliff since the introduction of fees in July 2013.

--- Later in debate ---

[Jo Stevens (Cardiff Central) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Streeter. May I refer the House to my entry in the Register of Members’ Financial Interests regarding my previous occupation as a director of Thompsons Solicitors, which is a national firm of employment law specialists that conducts a substantial number of employment tribunal cases on behalf of trade unions and their members?

I congratulate my hon. Friend the Member for Ellesmere Port and Neston (Justin Madders) on securing the debate. Like him, I am deeply concerned about this issue. As he outlined, the impact of the coalition Government’s tribunal fees has been to price people out of access to justice. The Conservative party calls itself the party of working people, but if there is one single policy that totally exposes that statement as a myth, it is the introduction of employment tribunal fees. The Conservatives knew exactly what the impact of the policy would be, because they and their Liberal Democrat coalition partners at the time were told repeatedly and forcefully that the proposal would decimate access to justice. Just as with legal aid cuts, civil court fee increases, restrictions on judicial review, the Trade Union Bill, the proposal to repeal the Human Rights Act and the intended increase to the small claims limit that the Chancellor announced in last week’s spending review, employment tribunal fees were not introduced to solve a real problem. They were introduced to diminish the voice of ordinary working people, of trade unions and of their members.

I am sure the Government will try to say that the rationale for introducing the fees was to defray the cost of the Courts and Tribunals Service. If that really was the rationale, it has failed spectacularly, because so few people can afford to bring claims that the revenue has not been generated, as my hon. Friend the Member for Ellesmere Port and Neston said.

The Minister for the Cabinet Office and Paymaster General openly stated that the purpose of the fees was to deter people from bringing employment tribunal claims. In an article for The Telegraph website in March 2014, he wrote:

“Unscrupulous workers caused havoc by inundating companies with unfounded claims of mistreatment, discrimination or worse. Like Japanese knotweed, the soaring number of tribunal cases dragged more and more companies into its grip, squeezing the life and energy from Britain’s wealth creators.”

He went on to say that the tribunal system had

“become a system that in too many cases was being ruthlessly exploited by people trying to make a fast-buck.”

Where is the evidence for that? If the situation really was as he stated, the success rate in employment tribunal cases brought after the introduction of fees would have risen significantly, because the fees would have acted as a disincentive for unmeritorious claimants. What has actually happened? The success rate has stayed at the level it was at before the introduction of fees.

Preventing access to justice through high fees, therefore, weeds out not just unmeritorious cases—I accept there will be a few of those—but nearly all cases. In that respect, the policy has been tremendously successful. Fees have had a severe negative impact on the ability of people—particularly those on low and average household incomes and the more vulnerable in society—to access the justice system. That was a shameful intention. We had a Minister openly stating that he and his coalition partners wanted to prevent members of the public from accessing the justice system.

[Ian Lavery]

My hon. Friend will not be surprised by that attack on hard-working people in the workplace who want to seek justice. Like me and other Members, she has experienced the gagging Bill part 1, the gagging Bill part 2 and what is classified as a trade union Bill. All in all, they are a concerted attack on people who just want to get on in life. If there is a problem with justice in the workplace, they want to be able to challenge it.

[Jo Stevens]

My hon. Friend is absolutely right. I could not have put it better myself.

As we have heard, there has been a 69% drop in single-applicant cases since the introduction of fees. However, I want to comment on a couple of other statistics. There has been a 90% drop in sex discrimination cases and a 45% drop in pregnancy-related unfair dismissal cases. That is yet another example of the Prime Minister’s problem with women. He does not want public money spent on women, so they bear the brunt of 75% of his Government’s public sector spending cuts. He does not want to do anything about the grossly unfair VAT regime—the tampon tax. Instead, he cuts funding for domestic violence refuges and rape counselling services, and he makes women pay for those services themselves through the VAT on sanitary products. Furthermore, if any of us is subject to sex discrimination at work or sacked because we are pregnant, he prices us out of access to an employment tribunal to challenge that unlawful treatment.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Justice (Mr Shailesh Vara)]

It is a pleasure to serve under your chairmanship, Mrs Gillan.

I congratulate the hon. Member for Ellesmere Port and Neston (Justin Madders) on securing the debate. It is an important subject, and I know that in his case it is particularly so, given his background as an employment solicitor. I thank the other contributors, the hon. Member for Glasgow South West (Chris Stephens) and the hon. Member for Cardiff Central (Jo Stevens), and the two Front-Bench spokespeople, the hon. Member for Dumfries and Galloway (Richard Arkless) and the hon. Member for Kingston upon Hull East (Karl Turner). I also thank the hon. Member for Ellesmere Port and Neston for allowing me the opportunity to put on record the Government’s position.

The Government recognise the crucial service that employment tribunals provide to those employees who have serious disputes with their employers. It is vital that people in that position have meaningful access to justice and an effective way to remedy their problems.

[Ian Lavery]

If it is that vital for ordinary people in the workplace to access justice, will the Minister explain why his Government introduced a £1,200 tribunal fee?

[Mr Vara]

I ask the hon. Gentleman to bear with me, as I will turn to that issue, and also to the issue of working people that has been mentioned by a number of colleagues.

Hon. Members will be aware that the Government were elected as a majority Government with a clear mandate to eliminate the budget deficit during this Parliament. That requires a responsible approach to funding public services, which must include the courts and tribunals, both now and in the future. When the Government introduced fees in employment tribunals in 2013 it was estimated that the cost of running the service was about £84 million per year. Before the introduction of fees, the whole burden of that cost was met by taxpayers. Fees were introduced to reduce the burden, and to ensure that those who were using the service and benefiting directly from it were making a reasonable contribution to the cost, when they could afford to do so.

At the time the fees were introduced, we also applied Her Majesty’s Courts and Tribunals Service fee remissions. That scheme is there to ensure that those on low incomes are not prevented from lodging a claim. Under the scheme, those who qualify may have their fees waived, either in part or in full, depending on their financial means. I am a little disappointed that although much has been made of the employment tribunal fees, only a passing reference was made to the conciliatory scheme introduced by ACAS, to which I will turn shortly.

As far as remissions are concerned, I am grateful for, and have very much taken on board, hon. Members’ practical comments, and I can assure colleagues that my officials are looking at how applications are made to see how the process can be made simpler and more user-friendly.