Coalition row erupts as workers are 'priced out' of tribunals

Exclusive: Lib Dems demand Tory minister conducts urgent review

A major political battle was brewing last night over the 70 per cent fall in the number of people suing through employment tribunals since the Government started charging for them.

Many workers have been priced out of the system and the Liberal Democrats are now demanding the Conservative minister in charge conducts an urgent review into the “alarming” impact on case numbers. Tribunals are likely to prove a key electoral battleground.

After much lobbying from business organisations, the Ministry of Justice introduced fees of around £1,200 to employees wishing to go to tribunal. It was a plan first outlined by Chancellor George Osborne at the 2011 Conservative party conference.

Since fees came in last year, the number of tribunal cases has plunged 70 per cent, according to official figures. Lawyers report that in some areas such as sex discrimination, it is down 85 per cent.

Now, even employers’ groups are distancing themselves from the new regime, claiming they did not intend charges to be so high.

The MoJ had pledged to review the system a year after its introduction last July. It then said it would take place in the autumn, but still nothing has happened.

Last night, The Independent has learned, the Lib Dem employment minister Jo Swinson wrote to the courts and legal aid minister Shailesh Vara to demand an urgent review: “There is a clear, necessary and now increasingly urgent need for this review to take place,” she said. “As a Government, we committed at the time of their introduction to review the impact of fees and, 18 months on, this is now long overdue.

“We need to undertake an open and objective assessment of the impact of these reforms as well as any unintended consequences… I want to ensure that a full assessment of the equalities impact of the introduction of fees takes place without further delay, particularly given the alarming drop in sex discrimination claims.”

Shadow business secretary Chuka Umunna has said a Labour government would overhaul the whole system, making it free again but also quicker than the laborious former system.

He pointed out that the Lib Dems were part of the Government that introduced the fees in the first place, calling Ms Swinson’s letter “a cynical and utterly shameless attempt to distance her party from tribunal fees just five months before the general election”.

Meanwhile, the Unison union has been attempting to challenge the system through the courts.

The Ministry of Justice points out that more people are going to arbitration instead of employment tribunals.

Justice Minister Shailesh Vara said: "Small businesses were being hamstrung by employment tribunals and taxpayers were having to foot the £74 million bill for running the service. That's why we have brought in fees to make sure the costs of the tribunals are being covered fairly.

"We have always been clear in our commitment to undertake a post-implementation review of fees in the employment tribunals. We are currently considering the timing and scope of the review and we will be announcing the details in due course.

"We have also taken measures to ensure that fee waivers are available for those who can't afford to pay and at the same time At the same time we have tried to divert people away from divisive hearings through a new early conciliation scheme"

Richard Fox, senior partner at the law firm Kingsley Napley, said: “The effects of these changes have been far greater than the Government expected. This long-promised review is significantly overdue.”