Employment Tribunal – Employee’s Legal Costs

Employment Tribunal Fees were introduced on 29 July 2013. Both issue and hearing fees were payable and depending on the type of the claim, a claimant would have had to pay between £160 to £250 issue fee and between £230 and £950 hearing fee.

Good news for employees though...

On 26 July 2017, the courts declared that the tribunal fees were unlawful, and since then fees are no longer payable for tribunal claims or EAT cases.

Unfortunately, the costs of bringing a claim against an employer can still be very high and this is usually the main reason why many employees are discouraged from bringing a claim. As an employment lawyer, it is often very frustrating to tell employee clients that they have a good/strong claim, but it will cost them to bring the claim. And more often than not, it is not possible to recover your legal expenses from your employer even if you were successful in bringing the claim.

It is very difficult to provide a fee quote for the overall legal costs as the work to be done will depend on how the matter proceeds. For example, if a matter settles at the ACAS early conciliation stage then the legal costs could be as little at £300 plus VAT. Equally, if the matter proceeds to a full tribunal then legal costs could be in excess of £10,000 (excluding VAT and disbursements).

However, here at Sykes Anderson Perry, we like to be open on costs – it makes no sense not to keep you up to date with costs. So, in an attempt to be frank and help, we have provided this guideline of the stages involved in bringing a claim and a fee estimate at each of these stages.

Assessing your claims

We can arrange either an initial telephone conference or meeting and during which we get as much information from you relating to your employment and potentially any dismissal. This will help us to identify the potential claims you may have and the strength of the claim.
At this stage, it is often very helpful and cost effective if you come prepared with the following:

  1. Contract of employment;

  2. Pay slip and a breakdown of all your salary and benefits;

  3. A written summary of all that has happened leading to you thinking about bringing a case against your employer;

  4. Relevant correspondence/emails to and from your employer; and

  5. Any other relevant documentation – for example, staff handbook.

The first 30 minutes is free. Thereafter, we would usually limit our costs to between £250 and £750 plus VAT to assess your claim(s). This will include reviewing the documents provided, speaking with you, identifying the potential claims, compensation and costs involved.

ACAS early conciliation (EC)

An employee bringing the claim will be referred to as a claimant.

All claimants must contact ACAS and obtain a certificate before a Tribunal will accept his/her claim. This stage is a form of mediation – it is an attempt to settle the claim before the need to go to a tribunal / court.

The fees depend on the time spent negotiating but will generally be between £250 and £750 plus VAT. The fees will include negotiating with your former employer via the ACAS conciliator on your behalf in an attempt to an early settlement of your claim(s).

ET1 – the claim form

This is the form on which you will set out the claims you are bringing and the compensation sought.

The fees, depending on the complexity of the claim, will be between £500 and £1,000 plus VAT. It will include drafting the ET1 and submitting it to the employment tribunal.

ET3 - response

This will be prepared by your employer – it is effectively their defence to the claim being brought and must be submitted within 28 days from the date of the claim sent to them.

The employer responding to a claim will be referred to as a Respondent.

It will be necessary to review the ET3 to determine:

  1. Points agreed;

  2. Allegations denied;

  3. Allegations admitted;

  4. Allegations not specifically confirmed or denied; and

  5. Any new information provided.

The fees for this review will be approximately £500 plus VAT. It will also include advising you of your next steps.

Case management orders

Once the judge has seen both the ET1 and ET3 they will give several directions. Again, the directions will depend on the claim and what has and has not been admitted.

Generally they might include the following:

  • Amending claim or response;

  • Further and better particulars;

  • Mediation;

  • Specific disclosure*;

  • Disclosure of lists and documents;

  • Schedule of loss and mitigation evidence;

  • Expert evidence*;

  • Preliminary and further preliminary hearing*;

  • Witness statements;

  • Preparation of hearing bundle;

  • Chronology;

  • List of agreed facts and outstanding issues;

  • Skeleton arguments and authorities;

  • Written submission.

* these are usually associated with claims involving discrimination elements.

The good news is that the employer will be responsible for preparing the hearing bundle – this can be time consuming. However, the employee will need to review the hearing bundle when they receive it.

The most time consuming and costly directions relate to the preparation of the witness statements and reviewing the hearing bundle. These together with the ET1 and ET3 are the key documents to a successful claim. A judge has limited time to review the documents before the hearing and often they will rely on these documents so they need to read well – almost like a book. Reference to the documents need to be accurate and without fault. If you have mis-referenced, it is unlikely the judge will spend time looking for the correct document to which you are referring.

The costs involved for drafting and preparing the witness statements and reviewing a hearing bundle will usually be between £1,500 and £3,000 plus VAT.

The other potentially costly direction is the preliminary hearing, particularly if it is necessary to appoint a barrister for the advocacy and/or travel to a tribunal. Often, it is possible to convert the hearing to a telephone-based hearing. This can save costs. Preliminary hearings are important and will usually give you an indication of what the final outcome will be, and so it is necessary to prepare for them appropriately.

The costs for the preliminary hearing will usually be between £750 and £1,500 plus VAT. This will include advocating on your behalf as well as preparing the necessary for the hearing.

The cost of preparing the schedule of loss will depend on how organised you have been. But generally, it will be approximately £500 plus VAT.

The hearing

A hearing can be scheduled to last between 2 and 5 days. The more complex the claim the longer it will take. Equally, if there are several witnesses involved then it will clearly take more time to hear and cross examine them.

It is often more appropriate to appoint a barrister to do the advocacy but it is possible for solicitors to do the advocacy.

The costs of the hearing can be anywhere between £2,000 and £6,000 plus VAT. This will include attending the hearing with you and potentially advocating on your behalf if you have not appointed a barrister to do so. It also includes time spent to prepare for the hearing itself, for example, preparing copies of the bundle of documents. It does not include the barrister’s fees. It is not necessary for both a barrister and a solicitor to attend the hearing. However, certain barristers will prefer to have the solicitor present as they will have prepared for the hearing and can locate the necessary documents/evidence quickly and efficiently.

Funding the Claim

Many individuals will have legal expenses insurance through their home building and content insurance. So, it is most definitely worth checking your policy, and if you do have legal expense insurance then you should contact your insurer straight away and ask for their advice. Usually, the insurance company will have a panel of solicitors and will prefer you to use their solicitors but there is no harm in asking your insurance company if they would be agreeable to you appointing your own solicitors. Bringing an employment claim is very personal, and it is important to have a solicitor you can trust and you are happy to work with. Whether or not your insurance company agrees will usually come down to the hourly rate of your solicitors. We would be happy to liaise with your insurer in these instances.

It may also be worth considering “After the Event Insurance” to fund your claim. Whether it is available will usually depend on the strength of your claim, but note it can be expensive.

There are firms of solicitors who may be willing to act on your behalf on a contingency basis – i.e. no win no fee. It is not our usual practice here but we will consider this on a case by case basis.

It may also be worth considering using a pro bono organisation to help you bring your claim. There are a few available and you can do a search to find one close to you.

Finally, it is always possible for you to bring the claim yourself as a litigant in person.

Recovering your costs

Unfortunately, cost orders do not follow the event in an employment tribunal. This means even if you were successful you may not necessarily recover your legal costs. Conversely, if you were unsuccessful in your claim, it would be very unusual for your employer to obtain a cost order from you to pay their legal costs.

It is not impossible to have your legal costs reimbursed but it is rare.

Final word...

If you are considering a claim or you have been dismissed then do get in touch. Take advantage of the first 30 minutes free of charge. It will normally be enough to give you an understanding of what claims you have and what actions you need to take.