Low-paid prudent savers will now have to raid their savings to take a bad boss to court

Low paid workers who have been prudent savers will now have to raid their savings in order to take their employer to court, as a result of new restrictions in the employment tribunal fees remissions scheme coming into effect from today (Monday).

Earlier this year, the government introduced new upfront fees for individuals who felt they had been wronged at work and had chosen to take an employer to an employment tribunal. A remissions scheme was also set up so that low-income individuals would not have to pay fees of up to £1,200 to make a claim.

However, from today new restrictions on the remission scheme means that if an individual, or their partner, has savings or investments of £3,000 or more they will have to pay the full fee. This new restriction applies to everyone, including those who are out of work or on low incomes, as long as they or their partner has savings.

The new scheme would mean, for example, that a woman sacked because of her age, or because she is pregnant, would still have to pay £1,200 to have her case decided at a tribunal, even though she is out of work, as long as she or her partner have savings of £3,000 or more.

The TUC is concerned the new scheme will disadvantage the low-paid who have been prudent and put modest savings aside. The change will particularly affect older workers who are more likely to have savings as they approach retirement.

TUC-commissioned analysis of the Family Resources Survey – published by the Office for National Statistics – shows that just one in 20 workers aged 50-60 are now likely to be fully exempt from paying the full fee when lodging a complaint against their employer at a tribunal. With almost one in five workers aged 50 plus likely to get any kind of financial support, fees of £1,200 will become the norm for anyone sacked because of their age, says the TUC.

Even among households where someone is on the minimum wage, fewer than one in four of these workers will receive any support and will have to pay full fees of £1,200.

The number of disabled workers exempt from tribunal fees is also likely to halve, says the TUC, with just one in nine likely to be exempt from tribunal fees. 

TUC General Secretary Frances O’Grady said: “The government has put up huge financial barriers against employees seeking justice from bad bosses.

“The remissions scheme was set up to help people on low incomes avoid paying fees. But the changes which come in today could mean thousands of older workers having to raid their retirement savings if they want to seek justice against an employer that has mistreated them.

“The changes today make it easier for rogue bosses to get away with mistreating staff, not paying them properly and dodging the minimum wage. This is not the kind of labour market hardworking people want to see.”

NOTES TO EDITORS:

- The TUC commissioned economist Howard Reed to estimate the proportion of households affected by changes in the tribunal fees remission scheme.

Number of households entitled to full remission from employment tribunal fees

Source: Family Resources Survey 2010/11

- The proportion of workers entitled to a partial remission relate to level 2 employment tribunal claims, such as unfair dismissal or discrimination, which carry higher upfront fees of up to £1,200. Level 1 claims, such as unpaid wages and holiday pay, have lower upfront fees.

- All TUC press releases can be found at www.tuc.org.uk

- Follow the TUC on Twitter: @tucnews

Contacts:

Media enquiries:
Liz Chinchen   T: 020 7467 1248    M: 07778 158175    E: media@tuc.org.uk
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Elly Gibson   T: 020 7467 1337    M: 07900 910624     E: egibson@tuc.org.uk