R (Unison) v Lord Chancellor

The Court of Appeal dismissed Unison's challenges to the Employment Tribunal and Employment Appeal Tribunal Fees Order 2013 (the "Fees Order"). The principal legal issues were (i) whether the fees regime breached the EU "principle of effectiveness" (and related Convention article 6 concerns) by rendering access to tribunal justice in practice impossible or excessively difficult for some claimants; (ii) whether the Fees Order amounted to unlawful indirect discrimination under EU law and domestic equivalents; and (iii) whether the Lord Chancellor breached the public sector equality duty in section 149 of the Equality Act 2010. The court held that (a) evidence of a dramatic fall in tribunal claims after fees were introduced was not, by itself, sufficient to establish that a significant number of claimants could not realistically afford fees; (b) properly constructed evidence of individuals' affordability could be admissible, but on the material before the courts the notional examples and statistics did not prove a breach of the effectiveness principle; (c) paragraph 16 of Schedule 3 (the discretion to remit fees in "exceptional circumstances") meant the regime could be interpreted and operated so as to avoid infringing access to justice, and that remedial administrative or judicial review routes remained available; (d) Unison had not established unlawful indirect discrimination in the material before the Divisional Courts; and (e) the Equality Impact Assessment and associated steps taken by the Lord Chancellor did not disclose a breach of the section 149 duty. The court also confirmed that the first challenge (Unison 1) was properly considered premature to the extent it relied on post-implementation effects not then known, and that the Lord Chancellor should review the regime in the light of post-implementation evidence.

Background and proceedings:

• Unison judicially reviewed the Lord Chancellor's decision to make the Employment Tribunal and Employment Appeal Tribunal Fees Order 2013. Two strands of litigation were referred to as Unison 1 (commenced July 2013; dismissed by the Divisional Court on 7 February 2014, [2014] EWHC 218 (Admin)) and Unison 2 (filed 23 September 2014; dismissed by the Divisional Court on 17 December 2014, [2014] EWHC 4198 (Admin)). Both decisions were appealed to the Court of Appeal and heard together.
• Unison sought quashing of the Fees Order and related relief, relying on EU law (the principle of effectiveness), indirect discrimination arguments, and alleged failure to comply with the public sector equality duty. The Equality and Human Rights Commission intervened in support of Unison.

Nature of the relief sought: declaratory and quashing relief against the Fees Order and associated relief on the grounds that the fees and remission criteria denied effective access to justice, were indirectly discriminatory and breached the Equality Act duty.

Issues framed by the court:

• whether the fees regime rendered access to tribunal justice "virtually impossible" or "excessively difficult" for some claimants (principle of effectiveness/Article 6);
• whether the Fees Order had a disparate impact amounting to unlawful indirect discrimination and, if so, whether it was objectively justified;
• whether the Lord Chancellor complied with the Equality Act 2010 s.149 duty in designing and implementing the fees regime;
• whether the Unison 1 challenge was premature.

Court's reasoning (concise):

• The court accepted the legal tests from EU and ECHR jurisprudence: charging fees may be legitimate but must not have a disproportionate effect that makes access to justice illusory. The correct factual inquiry is whether claimants can realistically afford the fees.
• The evidence: Unison relied on (a) illustrative notional claimant scenarios and (b) empirical statistics showing a very large fall in tribunal claims after fees were introduced. The Divisional Courts and the Court of Appeal treated both forms of evidence with caution. A fall in claim numbers alone could reflect deterrence rather than inability to pay; that alone did not prove a breach of the effectiveness principle. Notional claimant examples can be admissible, but on the evidence before the courts they did not establish realistic unaffordability in sufficient numbers.
• The court emphasised the relevance of paragraph 16 of Schedule 3 (the Lord Chancellor's power to remit fees in "exceptional circumstances"). If operated in a manner compliant with the effectiveness principle, that discretion could prevent the Order from being inherently unlawful. The court said that the discretion should be interpreted generously to accommodate those who cannot realistically pay.
• On indirect discrimination, the court analysed three variants of the claim and concluded that Unison had not proved the requisite disparate impact on protected groups, and that the differentiation between "type A" and "type B" fees could be justified by reference to differing demands on tribunal resources.
• On s.149, the court noted that the Lord Chancellor had undertaken multiple consultation and equality impact assessment steps; while some predictions proved optimistic, the assessment process and the continuing duty to monitor did not disclose a legal infringement of the duty to have due regard.
• The court declined to quash the Fees Order, observing that a post-implementation review was appropriate given the striking fall in claims and that administrative remedies or further judicial review would remain available if evidence established unlawful effects.

The appeals were dismissed. The Court of Appeal held that Unison had not proved that the Fees Order breached the EU principle of effectiveness, that the statistical fall in claims by itself did not establish that claimants could not realistically afford fees, and that the availability of remission in "exceptional circumstances" (paragraph 16 of Schedule 3) and the possibility of administrative and judicial review meant the regime was not inherently unlawful. The court also rejected Unison's indirect discrimination and public sector equality duty challenges on the material before the courts and endorsed the Divisional Courts' conclusion that pre-implementation challenges based on speculative predictions were properly treated with caution.

This judgment is an appeal from two Divisional Court decisions: Unison 1 dismissed by Moses LJ and Irwin J ([2014] EWHC 218 (Admin), handed down 7 February 2014) and Unison 2 dismissed by Elias LJ and Foskett J ([2014] EWHC 4198 (Admin), handed down 17 December 2014). Limited permission to appeal was given by Sedley LJ on 19 May 2014 and further permission was granted on 31 March 2015 to pursue remaining grounds; the two appeals were heard together in the Court of Appeal and decided by Underhill LJ, Davis LJ and Moore-Bick LJ on 26 August 2015 (this judgment, [2015] EWCA Civ 935).