Dangerous decisions? (2)

The second decision I wanted to talk about was the Divisional Court ruling in the case of Unison (No.2), R (on the application of) v The Lord Chancellor. Unison had challenged the imposition of fees on would-be employment tribunal claimants, claiming that this denied any effective access to justice to many – or most – potential claimants, while also discriminating indirectly against some (poorer) groups. (More detail and discussion from Lauren Godfrey.)

The case report in Unison (No.2), as it will probably be abbreviated (or R v The Lord Chancellor, as I like to think of it), is distinguished by a weakness, an equivocation and a monstrosity. The weakness, on the claimant’s side, is probably sufficient to explain the negative finding, but it needs to be sharply distinguished from – and set in the context of – equivocal and monstrous arguments advanced by the defence. Once that’s done it’s clear that this is, still, a case which cries out for justice, even if the particular form it’s taken may doom it to a judicial dead end.

So far, so gnomic; let’s crack on. Unison’s case was, not that the imposition of ET fees would tend to put ET claims out of the reach of claimants, but that it actually had done so. Sadly, this claim was undermined by a key weakness in the union’s argument. An earlier application, based on the anticipated impact of the fees before they were introduced, was rejected on the grounds that the union had (of necessity) relied on hypothetical examples. This application relied instead on statistical data, which the Divisional Court (Lord Justice Elias and Mr Justice Foskett) found highly persuasive:

  1. There is no doubt that the reduction in the number of cases brought is striking. The Tribunals Statistics Quarterly for October to December 2013, published on 13 March 2014 show that, comparing the period October-December 2012 with the period same period in 2013 (the Fees Order having come into force on 29 July 2013), 79% fewer claims were accepted by the ET . For equal pay claims, the figure was 83% and for sex discrimination it was 77%.
  2. The Quarterly for January to March 2014, published on 12 June 2014, confirm the continuing dramatic effect of the Fees Order and suggest that the earlier statistics were not aberrant. Between January and March 2013, 57,737 claims were brought in the ET. However, for the same period in 2014, just 10,967 claims were brought. That is a drop of 46,660 claims or 81%. There is other evidence to similar effect.

The interpretation of these figures presents two issues, one of which the court (perhaps surprisingly) conceded: the reference to the continuing dramatic effect of the Fees Order takes it as given that the huge drop in cases was in fact caused – in some way and to some extent – by the introduction of fees. The second issue is more problematic: what is the nature of that causal relationship? The claimant’s case – denial of effective access to justice – requires that the fees regime made a tribunal application so expensive as to be effectively impossible. But this is fearsomely hard to prove in any individual case. If you think about it, affordability is an inherently elastic metric. Every time a fashion-conscious youth tribe makes the news – from the Teds to the New Romantics and beyond – there are stories of young men with menial jobs wearing ridiculously expensive suits, which they’ve bought by saving literally every penny they earn. On the same basis, anyone who earns enough to run a car could ‘afford’ a Rolex, just so long as they didn’t mind walking everywhere for a year.

The point here is that the vagueness built into the concept of ‘affordability’ makes it hard to prove that – in any given case where person A declines to spend money on purchaseable good G – the reason was that the potential purchaser could not afford the asking price. But, if something’s hard to prove in a single case, it’s just as hard to prove in several thousand cases. And if something’s not proved it can’t be assumed, or not without very good evidence in its favour – irrespective of whether we’re talking about one person or many. The fact that there are not one but 46,660 people who may have found ET fees unaffordable doesn’t, logically, make the case for unaffordability in any individual case any stronger – on the contrary, the case for applying the ‘unaffordability’ argument to many people depends on first proving it in at least one case, showing that at least one person has been deterred. That certainly looks like what has happened; discussing the alternative factors proposed by the Lord Chancellor, the case report notes that “[these factors] do not begin to explain the whole of this very dramatic change”. But a legal finding that it has happened would require much stronger evidence:

  1. … I suspect that there may well be cases where genuinely pressing claims on a worker’s income will leave too little available to fund litigation. But the difficulty with the way the argument has been advanced is that the court has no evidence at all that any individual has even asserted that he or she has been unable to bring a claim because of cost.The figures demonstrate incontrovertibly that the fees have had a marked effect on the willingness of workers to bring a claim but they do not prove that any of them are unable, as opposed to unwilling, to do so.

Note the last phrase – I’ll be returning to it. The implication of this paragraph is that only an approach based on actual cases would meet the appropriate evidential standard, although, as Lauren says, this would have its own pitfalls: “[f]aced with individual cases, the Lord Chancellor would no doubt argue they are atypical.”

As for the equivocation mentioned above, this relates to the second charge, of discrimination. Unlike the charge of outright denial of effective access to justice, the charge of indirect discrimination is open to the use of aggregate figures: if an identifiable group verifiably comes off worse, there’s a case to answer, even if no individual is complaining. In this case, as long as there is an identifiable group of potential claimants who have been differentially discouraged by the fees regime – and hence, ultimately, disadvantaged relative to the majority who were not discouraged in the same way – it does not need to be shown that any individual claimant has been compelled outright to abandon a claim. What does need to be shown, however, is that the discriminatory effect was caused in pursuit of a broader social goal which is not meritorious enough to justify it, either because the goal is wanting or because the discriminatory cost is disproportionate. The Lord Chancellor’s representative met this challenge with an argument which seems to have satisfied the two judges hearing the case, but… well, see what you think.

  1. The evidence shows that in setting up the fee scheme the government were seeking to achieve three specific and quite distinct objectives: the first was to transfer a proportion (one-third) of the annual cost of running ETs and the EAT to those users who benefit from it and can afford it; second, to make Tribunals more efficient and effective not least by removing unmeritorious claims; and third, to encourage alternative methods of employment dispute resolution so that litigation is not the first resort. This last objective goes hand in hand with the government’s promotion of ACAS conciliation which became mandatory for all ET claimants from 6 May 2014. The government considers that it should encourage quicker, cheaper and less emotionally damaging alternatives to the judicial process.

As with the previous quote, the last sentence is an interesting one – keep it in mind. For present purposes, the point is that the imposition of fees has been justified in three “quite distinct” ways. That there are multiple objectives is key to the government’s case here: one of the stated objectives, and perhaps the most obvious – saving money – is not regarded as sufficiently valuable to justify discrimination, for obvious reasons (denying healthcare to non-Whites or education to girls would save loads of money, after all). (In the interests of completeness I should note that the case report also argues that “requiring a contribution towards the cost of running the Tribunal Service” is not equivalent to “costs saving”, but the reasoning at this point is obscure.)

That leaves the two objectives of promoting efficiency (at least in part by “removing unmeritorious claims”) and of encouraging early recourse to conciliation and mediation. Lauren is unimpressed:

it must be doubted that there is a meaningful distinction between fees on the one hand – which reduce cost to both government, in running the Employment Tribunal system, and employers in defending claims – and the requirement on claimants to enter early conciliation on the other, as both requirements unquestionably serve the same identical dual aims. Further, and with due respect to the Court, they are requirements whose aims are grounded in cost alone.

I think this misses something. It’s certainly true that an ET system which charges a fee for each case and an ET system which processes fewer cases will both be cheaper to run, relative to the status quo ante, but I don’t think this is the main point here. The argument is that the fees will change some groups of clients’ behaviour: those claimants with conciliable claims will be encouraged to have them conciliated, while those with unmeritorious claims will be deterred from proceeding and will sling their hook.

I am surprised that the Divisional Court let this argument get past. The case report limits itself to a few comments on whether claimants who have weak claims or ought to be in mediation might in fact be encouraged to do the right thing by the imposition of fees. But the fee regime is, of its nature, imposed on claimants in general. The argument thus rests on an equivocation. The figure of the tribunal claimant, the person against whom these measures are directed, drifts in and out of focus as we read: he’s a trouble-maker and a chancer, who knows that he hasn’t really got a hope but plans to clog up the courts with his spurious claim anyway; she’s an unfortunate victim of workplace misunderstandings, who would rather not get the law involved but thinks she’s got no other option. Perhaps we could justify treating all claimants as no-hope chancers, on the basis that the good claims would stay in the system; perhaps we could justify treating all claimants as mediation clients gone astray, on the grounds that unmediable claims would find their way back to court. We certainly can’t justify treating all claimants as both these things – and, even assuming that both these groups exist in significant numbers, it’s hard to imagine any possible package of incentives which would address these two groups and nobody else.

In fact these aren’t two distinct objectives but one objective with two benefits. Given the lack of any possible mechanism to single out weak or inappropriate claims, and the lack of any evidence as to the prevalence of such claims in the system before the introduction of fees, the Lord Chancellor’s aim must have been – at best – to reduce the number of weak and inappropriate claims by means of an overall reduction in claims. The objective, then, is to divert people out of the system; the benefits are that these two groups, to the extent that they exist, will be dealt with more appropriately. The cost, meanwhile, is that a completely unknown proportion of the potential claimants who would otherwise have made claims – a proportion which may be anything up to 100% – will have had claims which would have been worth testing in court, and which will now go unvindicated. Not only is this an unknown proportion; it’s a proportion which there is, now, no way of knowing. The Lord Chancellor has in effect justified the introduction of fees on the grounds that it would reduce the use of the system – as indeed it has done.

Which brings me to the monstrosity. The context is the earlier argument about effectiveness; Ms Chan is representing the Lord Chancellor.

  1. Ms Chan’s basic submission, however, is that whatever the statistics say they cannot of themselves demonstrate that the principle of effectiveness has been infringed. It is not legitimate to infer that some litigants cannot pay from the fact that a significant number do not pay. Ms Chan accepts that the imposition of a fee will necessarily deter some litigants from taking their cases but contends that there are likely to be a variety of reasons for this. Some workers who in the past may have pursued a weak case, if only in the hope of securing a small settlement in their favour, will now be reluctant to do so because of the risk of having to pay fees if the case goes to the tribunal. Others will quite properly choose to spend their limited resources in other ways rather than gamble on litigation.

Savour that. Your elected government, ladies and gentlemen, doesn’t want you to gamble on litigation. It’s up to you how you choose to spend your limited resources, and if you don’t choose to spend them on vindicating your legal rights, that’s perfectly fine: the choice is yours. It’s your choice, except in the sense that it didn’t exist a couple of years ago: the decision whether or not to spend your money on employment tribunal fees has been created by this government, with the explicit intention of encouraging claimants to decide not to. Nothing says more about this Lord Chancellor’s contempt for the legal system than that pious invocation of ordinary people frugally husbanding their resources and choosing not to gamble on litigation. Legal rights? Never mind, your employer will respect them, probably. Best not worry about it.

Perhaps it was simply ultra this particular court’s vires – perhaps it’s more a matter for judicial review – but the real question at issue is stated in that quoted paragraph. By introducing a fee where none existed before, the government has restructured the terms on which people decide whether or not to go to a tribunal, with the express intention of discouraging them from doing so. In effect, the difficult, stressful and long-drawn-out process of going to an employment tribunal has been turned into a difficult, stressful and long-drawn-out process with a high up-front cost – a cost which in many cases will wipe out any monetary award which might eventually be made. This change has been made without any evidence that it would have a differential effect on cases which should not be going to court, or even that large numbers of such cases existed. Rather, it has been made in the knowledge that it would lead to a general reduction in the number of people asserting their rights under employment law, and (we can only assume) with that intention.

This is monstrous, and it should not be allowed to stand. I’m not sure that the Unison case is the vehicle by which it will be successfully challenged, but we can hope. Leave has been given to appeal.

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One Trackback

  1. […] Reading The Gaping Silence the other day I was struck by this post from the start of the year. I’d flicked through it then but it hadn’t struck home, but re-reading it it struck me that the dynamic it describes in respect of access to legal redress for workers is ever more constrained. But more than that there’s simply an indifference as to whether workers can afford legal redress. Indeed the institutions are structured in order to actually dissuade workers from seeking redress. That’s what political power means. […]

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