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News - 16 March 2012

Proposed tribunal fees stir up mixed reactions

The Governments consultation of the reform of Tribunals finished on 6 March and has been greeted with a mixed response.

Under the proposed changes, fees could be introduced for any employee wishing to raise a tribunal claim, with the aim of deterring weak or vexatious claims.

Two alternative options for the new fee system have been put forward, which involve either:

  • An initial fee of £150-£250 to enable an employee to raise a claim, with an additional fee of between £250 and £1250 if the claim goes to a hearing, and no maximum limit to the award; or
  • A single fee of £200-£600, with the maximum award capped at £30,000. Those seeking awards above this threshold would be given the option of paying an additional fee of £1,750.

The Government has also proposed cutting the redundancy consultation period and altering the qualifying employment period for making a claim from one to two years.

Commenting on the end of the Government's consultation process, John Longworth, director general of the British Chambers of Commerce (BCC), said that tribunal fees could give firms the confidence to hire new staff.

The Institute of Directors (IoD) similarly supported the decision to introduce claimant fees and suggested means-testing as a way of fairly charging those seeking tribunal decisions.

Neil Carberry, director for employment and skills policy at the Confederation of British Industry (CBI), also voiced concerns that the current proposals were ineffective in deterring weak claims.

The mixed opinions place Justice Minister Jonathan Djanogly, who is overseeing the plans, under greater pressure to reform the existing systems in a fair but firm manner. The Government will announce the next round of business regulations in the coming month, with any new legislation changes coming into effect from 6 April 2012.

According to the Government, tribunal claims rose to 236,000 in 2010 – a record figure and a rise of 56% on 2009 – and business has to spend almost £4,000 on average to defend itself against a claim.

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