Procedure

R (on the application of Unison) v Lord Chancellor (Equality and Human Rights Commission intervening): Queen’s Bench Division, Divisional Court: 7 February 2014

Fees – Defendant Lord Chancellor introducing fees regime for employment tribunal and Employment Appeal Tribunal – Claimant trade union applying for judicial review of introduction of fees regime – Whether principle of effectiveness breached – Whether principle of equivalence breached

In July 2013, the Employment Tribunals and Employment Appeal Tribunal Fees Order 2013, SI 2013/1893 (the order) came into force. The order introduced a fee-charging scheme for bringing claims in the employment tribunal and appeals to the Employment Appeal Tribunal (EAT) (the fees regime). The fees regime involved two types of claim, type A and type B, with type B claims incurring higher fees than type A claims. In addition, a remission scheme was introduced, which allowed prospective claimants on low incomes to obtain full or partial remission from the fees otherwise payable. Further, the guidance issued by the government indicated that the general position was that, if successful, the claimant employee would be reimbursed the fees paid by the employer. The claimant trade union applied for judicial review of the introduction of the fees regime.

The claimant submitted that: (i) the requirement to pay fees as a condition of access to the tribunal and EAT violated the principle of effectiveness since it would make it virtually impossible, or excessively difficult, to exercise rights conferred by European Union law; (ii) the requirement to pay fees violated the principle of equivalence since the requirement to pay fees or fees at the levels prescribed meant that the procedures adopted for the enforcement of rights derived from EU law were less favourable than those governing similar domestic actions; (iii) in reached the decision to introduce the fees regime and in making the order the defendant lord chancellor acted in breach of the public sector equality duty; and (iv) the effect of the order was indirectly discriminatory and unlawful. The intervener Equality and Human Rights Commission (the commission) supported the claimant’s position.

The claim would be dismissed.

(1) The use of the adverb ‘excessively’ in the jurisprudence suggested that the principle of effectiveness was not violated even if the imposition of fees caused difficulty and rendered the prospect of launching proceedings daunting, provided that they were not so high that the prospective litigant was clearly unable to pay them. It was clear that any regime had to be flexible, and have regard to the means of prospective litigants. The real difficulty lay in deciding when the level of fees imposed could properly be condemned as ‘excessive’.

The mere fact that fees imposed a burden on families with limited means and that they had to use hard earned savings was not enough. However, it was not possible to identify any test for judging when a fee regime was excessive (see [41], [42] of the judgment).

In the instant case, the combined effect of the remissions in the periods before and between the dates when fees had to be paid was that there was a sufficient opportunity even for families on very modest means to accumulate finds to pay the fees. Proceedings would be expensive, but not to the extent that bringing claims would be virtually impossible or excessively difficult (see [40] of the judgment).

Coote v Granada Hospitality Ltd [1999] IRLR 452 considered; Deutsche Post AG v Sievers: C-270/97 and C-271/97 [2000] ECR I-929 considered; Kreuz v Poland (Application 28249/95) [2001] 11 BHRC 456 considered; Podbielski v Poland (Application 39199/98) [2005] ECHR 39199/98 considered.

(2) On the facts, the claimant had failed to demonstrate any breach of the principle of equivalence. In circumstances where a successful employee should expect to recover the fees they had incurred from the employer, the level of fees to be paid under the order did not breach the principle of equivalence (see [51], [56] of the judgment).

Rewe-Zentralfinanz GmbH v Landwirtschaftskammer für Saarland: 33/76 [1977] 1 CMLR 533 considered.

(3) On the facts, it could not be successfully maintained that the lord chancellor had not considered the differential impact on various groups with protected characteristics. The claimant had had every opportunity to advance every possible ground on which the introduction of a system of the imposition of fees could be challenged. It could not be said that the lord chancellor had disregarded those points merely because it had dismissed them. The impact had been fully considered, even though its conclusion had displeased the objectors (see [66], [67], [69] of the judgment).

R (on the application of Brown) v Secretary of State for Work and Pensions [2008] All ER (D) 208 (Dec) considered; R (on the application of Hurley) v Secretary of State for Business, Innovation and Skills [2012] All ER (D) 116 (Feb) considered; R (on the application of Williams) v Surrey County Council [2012] All ER (D) 56 (Apr) considered.

(4) There was a strong suspicion that there would be some disparate effect on those who fell within a protected class who brought type B claims and therefore incur significantly higher fees than those bringing type A claims. However, it was not possible to reach a conclusion as to whether the imposition of a higher rate of fees for type B claims could be objectively justified if it had an indiscriminate effect. Although it was suspected that the imposition of the fees regime would have a disparate effect on those within the protected classes, it was not possible at the time of the instant hearing to gauge the extent of that impact.

Accordingly, it was not possible to reach a conclusion as to objective justification, dependant as that exercise was upon weighing the extent of the disparate impact (see [84], [88] of the judgment).

Steinicke v Bundesanstalt fur Arbeit: C-77/02 [2003] IRLR 892 considered; R (on the application of Elias) v Secretary of State for Defence [2006] IRLR 934 considered; Homer v Chief Constable of West Yorkshire Police [2012] 3 All ER 1287 considered; Riezniece v Zemkopibas minisrija: C-7/12 [2013] IRLR 828 considered.

Per curiam: ‘This brings us to a fundamental difficulty with the whole of this case. Brought as it was in the belief that the lawfulness of the regime had to be challenged as a matter of urgency, and in any event within three months, the court has been faced with judging the regime without sufficient evidence, and based only on the predictions of the rival parties throughout and after the hearing. 

‘Parliament decided, by affirmative resolution, to introduce the regime, authorised by statute, and debated and positively affirmed by both Houses of Parliament. Quite apart from the continuing obligation to fulfil the duties identified in the Equality Act, the lord chancellor has himself undertaken to keep the issue of the impact of this regime under review. If it turns out that over the ensuing months the fees regime as introduced is having a disparate effect on those falling within a protected class, the lord chancellor would be under a duty to take remedial measures to remove that disparate effect and cannot deny that obligation on the basis that challenges come too late. 

‘It seems to us more satisfactory to wait and see and hold the lord chancellor to account should his optimism as to the fairness of this regime prove unfounded. We believe both Unison and the commission will be, and certainly should be, astute to ensure that accurate figures and evidence are obtained as to the effect of this regime. No doubt the lord chancellor will also be doing the same, if he is successfully to resist a future challenge. In the meantime, we think that the fundamental flaw in these proceedings is that they are premature and that the evidence at this stage lacks that robustness necessary to overturn the regime. 

‘We would underline the obvious: there is no rule that forbids the introduction of a fee regime. The nature of that regime is closely dependent upon economic and social considerations and policy. The formation of such policies is itself dependent upon an accurate assessment of income and expenditure and the means of those who wish to use the Tribunal system, and in the light of the need to encourage challenges to discrimination in pursuit of the important goal of equality. This court did not find itself in any position accurately to collate the information, still less the evidence, in order to achieve a just resolution.’ (see [89], [90] of the judgment).

Karon Monaghan QC and Mathew Purchase (instructed by UNISON Legal Services) for the claimant; Susan Chan (instructed by the Treasury Solicitor) for the lord chancellor; Michael Ford QC (instructed by the Equality and Human Rights Commission) for the intervener.