Your right to bring a claim comes at a cost...

Settlement Agreements are utilised in order to settle actual or potential claims that an employee may have against their employer.

The alternative to a settlement agreement will be issuing court or tribunal proceedings, depending upon the potential claims you may have. The Employment Tribunal is the usual forum for claims relating to the mainstream employment claims such as unfair dismissal and discrimination.

Until 29 July 2013, employees were able to issue their claims without paying a fee. Employers complained that it was too easy for employees to bring claims. In response to this, and in an effort to reduce the burden on the public purse, the government introduced issue and hearing fees in the employment tribunal.

At present, the fees are as follows;

Claim

Issue fee

Hearing fee

Breach of contract

£160

£230

Unfair dismissal

£250

£950

Unlawful deductions

£160

£230

Discrimination & whistle blowing

£250

£950

Failure to provide written terms and conditions

£160

£230

Where multiple claimants are bringing a claim, the amount of the fees will also be determined by reference to the number of claimants. There are also additional fees if an employee or employer wish to appeal a decision.

The introduction of fees has been criticised by trade unions and employment rights charities who argue that fees restrict access to justice for the most vulnerable. A fee remission system exists whereby an employee wishing to bring a claim can apply for the fee to be waived if they are on low income and in receipt of benefits. However, this process incurs more time and expense both of which may be limited in an employment claim.

The Unions are not satisfied and have applied for a Judicial Review of the decision to introduce fees on the basis that it breaches EU law. The application was heard on 4 November 2013 and Judgment is awaited. Prior to the hearing, the UK government provided an undertaking that if the Judicial Review is successful, they will repay all tribunal fees paid, together with interest. Potential claimants and employment lawyers are eagerly awaiting the decision.

At present however, it appears that fees are here to stay. They are therefore a potential expense that should be considered if you have been offered a settlement agreement.

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