Yesterday’s decision by the Supreme Court declaring employment tribunal fees to be illegal came as a surprise, even to the experts.
Whatever side of the employment law fence you sit on, we should first of all acknowledge that this is an astounding victory for the legal team at UNISON.
They began their legal challenge in June 2013 and have lost twice in the High Court and once in the Court of Appeal. I , like many other employment lawyers, thought that they stood only a theoretical chance of winning. It was only when I saw the arguments in the Supreme Court that I thought ‘oh hang on, they might just do this’. Taking the case all the way took dogged determination, and amazing confidence in the face of some pretty negative judicial comment – but in the end they won through. Moments of utter triumph are rare in professional life and everyone involved deserves to revel in this one.
It was indeed a great achievement for Adam Creme and the UNISON legal team who kept going even when a lot of people told them they were on to a loser.
Employment tribunal fees are now dead in the water. To revive them would almost certainly require new legislation and a government with a shaky majority and loads of other important stuff to do is unlikely to bother. The low-key response from the government suggests they have more pressing problems to worry about.
The impact of tribunal fees is clear from the statistics doggedly compiled by Richard Dunstan who has been keeping an eye on this for years. The number of cases fell sharply when fees were introduced.
Whether it will return to its 2013 level remains to be seen. It may be that pent-up demand from dependent contractors and others pushes up the level of claims. Even so, Nicholas Robertson, head of employment law at Mayer Brown, quoted in People Management, thinks it won’t:
My view is that they will not return to those levels because the Acas mandatory conciliation scheme will continue to encourage parties to settle claims before litigation. Now that the fees regime for employment tribunals has gone, I suspect employers will be more likely to settle at the Acas stage, rather than waiting to see if claimants follow through and issue a claim.
The judgment has implications beyond employment law though. The Supreme Court used this case as an opportunity to give the government a stiff lecture about the rule of law. As Professor Mark Elliott says:
The relevant part of the Court’s judgment reads as a primer — albeit a very powerful one — on what the rule of law means in this regard. Indeed, it is difficult to escape the conclusion that the Court felt it necessary to drive home some very fundamental propositions — ones that should not really need to be driven home — because the Government’s position indicated ignorance of or contempt for them. The Court thus noted numerous “[i]ndications of a lack of understanding” of the importance of the rule of law, including:
- “the assumption that the administration of justice is merely a public service like any other”;
- “that courts and tribunals are providers of services to the ‘users’ who appear before them”; and
- “that the provision of those services is of value only to the users themselves and to those who are remunerated for their participation in the proceedings”.
These misapprehensions, said the Court, were evident from, among other things, Government consultation papers that had preceded the making of the Fees Order. Having noted that, the Court set about the task of establishing the demonstrable wrong-headedness of those assumptions.
I wouldn’t usually describe court judgments as entertaining but this one really is worth reading. It adopts the tone of a somewhat exasperated professor talking to group of lazy undergraduates.
The shoddiness of your previous work suggests that we will have to go over all this again:
66. The constitutional right of access to the courts is inherent in the rule of law. The importance of the rule of law is not always understood. Indications of a lack of understanding include the assumption that the administration of justice is merely a public service like any other, that courts and tribunals are providers of services to the “users” who appear before them, and that the provision of those services is of value only to the users themselves and to those who are remunerated for their participation in the proceedings. The extent to which that viewpoint has gained currency in recent times is apparent from the consultation papers and reports discussed earlier. It is epitomised in the assumption that the consumption of ET and EAT services without full cost recovery results in a loss to society, since “ET and EAT use does not lead to gains to society that exceed the sum of the gains to consumers and producers of these services”.
Now here is why the rule of law is important:
67. It may be helpful to begin by explaining briefly the importance of the rule of law, and the role of access to the courts in maintaining the rule of law. It may also be helpful to explain why the idea that bringing a claim before a court or a tribunal is a purely private activity, and the related idea that such claims provide no broader social benefit, are demonstrably untenable.
And this is what Parliament and the courts do:
68. At the heart of the concept of the rule of law is the idea that society is governed by law. Parliament exists primarily in order to make laws for society in this country. Democratic procedures exist primarily in order to ensure that the Parliament which makes those laws includes Members of Parliament who are chosen by the people of this country and are accountable to them. Courts exist in order to ensure that the laws made by Parliament, and the common law created by the courts themselves, are applied and enforced. That role includes ensuring that the executive branch of government carries out its functions in accordance with the law. In order for the courts to perform that role, people must in principle have unimpeded access to them. Without such access, laws are liable to become a dead letter, the work done by Parliament may be rendered nugatory, and the democratic election of Members of Parliament may become a meaningless charade. That is why the courts do not merely provide a public service like any other.
Now let’s go back to what we covered in the first term. Yes, back to 1215 but if you’d paid attention the first time we wouldn’t need to do all this:
74. In English law, the right of access to the courts has long been recognised. The central idea is expressed in chapter 40 of the Magna Carta of 1215 (“Nulli vendemus, nulli negabimus aut differemus rectum aut justiciam”), which remains on the statute book in the closing words of chapter 29 of the version issued by Edward I in 1297:
“We will sell to no man, we will not deny or defer to any man either Justice or Right.”
Those words are not a prohibition on the charging of court fees, but they are a guarantee of access to courts which administer justice promptly and fairly.
It’s not just Law, you’re going to have to repeat Economics term 1 too:
99. The primary aim of the Fees Order was to transfer some of the cost burden of the ET and EAT system from general taxpayers to users of the system. That objective has been achieved to some extent, but it does not follow that fees which intruded to a lesser extent upon the right of access to justice would have been any less effective. In that regard, it is necessary to point out an error in the Review Report, repeated in the Lord Chancellor’s submissions. The Review Report states that the Ministry of Justice have considered whether it would be more proportionate to charge lower fees, but that “the result of reducing fees would reduce the income generated by fees, and thereby reduce the proportion of cost transferred to users from the taxpayer” (para 307). That statement is unsupported by any evidence, and appears to be regarded as axiomatic. Similarly, in his written case, the Lord Chancellor states that, in pursuing the aim of transferring the costs of the tribunals from taxpayers to users, “the higher the fees are, patently the more effective they are in doing so”. This idea is repeated: in recovering the cost from users, it is said, “the higher the fee, the more effective it is”.
100. However, it is elementary economics, and plain common sense, that the revenue derived from the supply of services is not maximised by maximising the price. In order to obtain the maximum revenue, it is necessary to identify the optimal price, which depends on the price elasticity of demand. In the present case, it is clear that the fees were not set at the optimal price: the price elasticity of demand was greatly underestimated. It has not been shown that less onerous fees, or a more generous system of remission, would have been any less effective in meeting the objective of transferring the cost burden to users.
And given your lack of understanding in both subjects, it was perhaps inevitable that you’d fail to make the connection between them:
102. There is a further matter, which was not relied on as a separate ground of challenge, but should not be overlooked. That is the failure, in setting the fees, to consider the public benefits flowing from the enforcement of rights which Parliament had conferred, either by direct enactment, or indirectly via the European Communities Act 1972. Fundamentally, it was because of that failure that the system of fees introduced in 2013 was, from the outset, destined to infringe constitutional rights.
But, while it might be fun to watch ministers getting beaten up by judges, could this be an indication of how the court sees its role after Brexit? As Professor Elliott says:
[T]he protections offered by EU law, insofar as they are relevant, offer at least a form of guarantee of rights — even in the face of parliamentary sovereignty. But that guarantee is now approaching its expiry date, thanks to the UK’s impending departure from the EU, and its extrication from the constraining forces of EU law and the EU judicature. This, in turn, places renewed focus upon the capacity of domestic constitutional law to safeguard fundamental rights and rule-of-law values. Viewed in that light, the Supreme Court’s decision in Unison is certainly a powerful restatement of what the rule of law requires in this context — and of the courts’ preparedness to go as far as they constitutionally can in upholding it.
David Allen Green makes a similar point in the FT:
The area of law involved is greatly influenced by EU law — but the Supreme Court’s ruling is Brexit-proof. That EU law is engaged is treated as merely incidental. The judgment is based expressly on fundamental constitutional principles in the domestic law of the UK. (The UK does, contrary to popular belief, have a constitution, but it is not a codified one.)
The justices could have approached this case in a narrow technical sense but chose not to do so. They refer to Magna Carta and the great jurists Edward Coke and William Blackstone. The decision is framed in first principles being applied to the details of a particular tribunal fee regime. Even more than the Miller decision on parliament having to authorise the Article 50 notification, this is a constitutional judgment.
Far from being the “enemies of the people”, as some newspapers have called senior judges in recent times, the Supreme Court has told the government that an attack on workers’ enforcement of their rights (which is the same in practice as attacking the rights themselves) is outside the law.
And as Darren said, before the judgment:
[I]t is just possible that the Supreme Court is ready to do something dramatic and rule that a major government policy is illegal. The Court has already shown that it is prepared to put the cat among the pigeons when it comes to developing our constitutional law – think of Article 50 – and a positive result for Unison would open a new chapter in the Court’s willingness to limit the powers of the executive. It would assert the sovereignty of Parliament as expressed in Acts of Parliament as against the power of ministers to shape the law through orders and regulations slipped through with minimal scrutiny and no opportunity for amendment. It would be a very big deal and – bearing in mind the extent to which the Brexit process is likely to rely on ministers introducing secondary legislation – it would have ramifications well beyond employment law.
The Great Replication Repeal Bill, and the subsequent secondary legislation could throw up all sorts of opportunities for legal challenges. I particularly liked this comment from Cambridge employment lawyer Abigail Trencher:
One hopes this very expensive lesson may make future Governments reluctant to rely on secondary legislation to implement bold changes to the employment law landscape – which may provide some reassurance as we move towards Brexit and the concern at the extent to which future Governments may rely on secondary legislation to implement changes to employment legislation following the Great Repeal Bill.
Trouble is, this lot have proved to be very slow learners, even when the education is expensive.
But if the judiciary is to protect people’s rights and uphold the rule of law after Brexit, it can only do so if people have the wherewithal to bring cases to court. That was the original point of this case and one which, for me, is the most important lesson from it. Bringing the case required a dedicated team of lawyers and that required money. Lots of it. You can only challenge power if you have resources behind you.
In Britain (and especially England) we still have this ideal of the independent yeoman or artisan. We tell ourselves that there was a time before the fall when all Englishmen were free. It’s nonsense, of course, but persistent nonsense all the same. Its latest manifestation is the mythology of startups and the eulogies to freelancing. But small is not powerful. Unless it is lucky enough to control a particularly scarce resource, small gets walked over by big most of the time.
Here’s something I wrote 3 years ago:
Small might be very fashionable but small is not powerful. Furthermore, whatever Merrie England image you may have of autonomous yeomen and artisans, small has never been powerful. Small is only powerful when it gets together with others. Crucially, too, it only stays powerful when it stays together. Crowdsourcing and flash mobs might briefly unnerve the powerful but they are ephemeral. To maintain that pressure requires some sort of organisation. Our ancestors understood this. That’s why they formed trade unions, co-operatives and mechanics’ institutes.
That hasn’t changed. This case was only possible because a big trade union with massive resources but its weight behind it, thereby opening up the opportunity for those of lesser means to challenge their employers. Temporary coalitions, networks and crowdsourcing are all very well but the tenacity and resources needed to challenge entrenched power need something more permanent. As Gavin Kelly says:
[P]ower in the labour market still matters. In flexible market economies employers will always find new ways of shifting risk on to the workforce, often on to those least able to bear it. Unions are a rare countervailing force. They have led the way in confronting gig economy companies flouting employment law or care-providers dodging the minimum wage. In a union-free world, such abuses would go largely unchecked.
Unions are unfashionable at the moment but so far, no-one has come up with anything better. The courts and the law can only go so far. The law does not offer much protection unless you can use it and to do that you need help. If you really want to stop the powerful from walking all over you then you need some good people around you. It was the lesson that Hugh Grant’s selfish and hedonistic character learnt in About a Boy – you need backup. When it comes to disputes at work, a trade union is still the best backup you can get.