Low-paid prudent savers will have use savings to take bad employers to court

By agency reporter
October 9, 2013

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 which came into effect on 7 October.

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, new restrictions on the remission scheme mean 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 have 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 Trades Union Congress (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 only around 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.”


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