Employment tribunals: Costs to employees

If you are an employee who wants to bring a case to an employment tribunal and have it judged at a tribunal hearing, you do not have to pay any kind of tribunal fee. Fees were abolished in 2017.

But whilst there is presently no fee for employees to lodge a tribunal claim, there are other costs involved, as this guide outlines. 

See also our practical Introduction to employment tribunals for employees and our guide outlining the main steps in your tribunal journey.

How much does an employment tribunal cost an employee?

The cost of an employment tribunal to an employee can be anything from several hundred pounds to tens of thousands of pounds, depending mainly on whether or not you want to have legal representation.

Legal fees

The law used to be straightforward enough for employees to represent themselves at a tribunal in many cases.  But as it has become more complex, most people choose employment tribunal representation by legal professionals to guide them expertly through the process and to represent their interests. 

So, unless you decide to represent yourself (see our Introduction to employment tribunals for resources to help you with this),  you will have to consider the cost of legal fees.

If you are a member of a trade union you may be able to get help with progressing your tribunal claim, or legal expenses insurance (see below) may cover your legal costs.

Otherwise,  you will need to check out fees and funding options with an employment law specialist solicitor who has a strong track record of representing employees in employment tribunal cases, like Monaco Solicitors.

Legal expenses insurance cover

Legal expenses insurance (LEI) can be a godsend in covering the costs of your legal representation at an employment tribunal. You may not even be aware that you have LEI and it’s worth checking your insurance policies for it early on.

It’s most commonly found under your home insurance, car insurance or similar policy and can offer tens of thousands of pounds worth of cover.

If you don’t have LEI, some insurers offer a separate policy – even after you’ve decided to take legal action.

Such a policy will typically provide cover against you having to pay your employers’ employment tribunal costs if you lose and if the judge then orders you to pay your employers’ costs. See below for further discussion about this possibility.

See also our Introduction to employment tribunals for resources you can use if you decide to represent yourself in an employment tribunal case.

What are solicitors’ fees for employment tribunals?

Employment tribunal solicitors’ fees for representing you for an employment tribunal will vary. They will depend on such factors as the complexity of the case and the reputation/experience of the law firm and lawyer taking your case.   

So it’s not really possible to give you any national average solicitors’ fees, because what’s ‘average’ will vary from one firm to another. Suffice it to say that the more complex your case is, the higher the solicitors’ fees will be.  

Most law firms will give you a lower and upper estimate of their fees. Others may be willing to quote you for a ‘no win no fee’ arrangement, which is typically a fixed percentage of any amount you are awarded should you win your tribunal case.

However, in our experience, no win no fee arrangements for employment tribunal cases are not regularly offered. So if you do get such an offer, make sure that the deal is what you actually want and need before you sign up for it.

See also Monaco Solicitor’s Fees page to get an idea of what employment tribunal lawyers’ fees are for such cases.

Questions to ask about costs of legal representation

In addition to researching the reputation and success of your prospective lawyers at winning tribunal claims for similar cases as yours, you should also be sure to ask them whether any fees you are quoted include all costs. 

For example, do they include the costs of barristers (‘counsel’) to represent you during the tribunal hearing?  Do they include the writing and/or preparation of all documents likely to be required for a tribunal, such as the ET1 Claim form, taking and drafting witness statements, etc?

Who pays the legal costs of an employment tribunal claim?

Traditionally, in a civil court such as a county court or high court, the losing party pays the winner’s legal costs.

When each party pays for their own lawyers

However, in an employment tribunal, there is generally what’s called a ‘no-cost’ regime.  This means that each party pays for their own lawyers, barristers, etc., whether they win or lose.

This has usually helped with an individual’s right and ability to access justice. You don’t have to worry about having to find potentially tens of thousands of pounds to pay for your employer’s expensive solicitors and barristers if your claim is unsuccessful.

When one side has to pay both sides’ costs

Unfortunately over the years, case law has established that tribunals are more minded to award employment tribunal costs against you if you lose the case and your conduct was considered by the tribunal judge to be ‘unreasonable, vexatious and/or misconceived’.

This can happen if the claim you brought had no reasonable prospect of success or if the losing party – whichever side they were on – failed to comply with the tribunal’s orders or directions.  

This can also happen if your employer made you a reasonable settlement offer, but you did not accept it and then later your claim was unsuccessful at an employment tribunal.

This is explored in more detail below. Claimants (ie employees) are more likely to have employment tribunal costs awarded against them than respondents (employers).

Without prejudice ‘save as to costs’ – what does it mean?

If you’ve read our articles on without prejudice communications and without prejudice meetings, you’ll understand the meaning of the phrase ‘without prejudice’. 

So now we can introduce you to the term ‘save as to costs’ which can be used as an extension to the without prejudice rule. The term ‘save as to costs’ is often used in settlement offer letters to you from your employer, but you as an employee can, and should, use it too.  

The term ‘without prejudice save as to costs’ used in a legal letter heading, means that you cannot show the letter to a tribunal during the proceedings. 

However, it also means that it might be relevant at the end of the case and your employer makes an application to the tribunal for legal costs to be paid by you.

This often happens when your employer has previously made you an offer to settle and then you lose your case at tribunal or get awarded less than the original offer.

In such a case, the employer could apply to the tribunal for you to pay all of the legal costs.

They would argue that the whole hearing could have been avoided had you accepted their offer. They will further contend that the costs associated with the main hearing could have also been avoided (ie. the cost of preparing witness statements and the barrister’s fees for the hearing).

This can all add up to a significant amount.  But this rule works both ways – see below for more information.

Can an employee use ‘without prejudice save as to costs’?

You as an employee can also make use of this rule when you put forward a settlement proposal to your employer prior to a tribunal.

If your employer refused to accept your proposal, then you can use their refusal to support an application of your own for legal costs if successful (or to mitigate against the employer’s cost application).  

For example, your employer offers £2,500 to settle a claim worth £15,000. You as the employee respond with an offer of £8,000 to settle ‘without prejudice save as to costs’ (just over 50% of the value of the case). The claim is successful and you are awarded your damages in full.

Your barrister asks for the costs of trial preparation and attendance at the tribunal to be paid by your employer, as the whole hearing could have been avoided had the employer accepted the £8,000 offer made months before.   

Without prejudice save as to costs tactics

Without prejudice save as to costs letters are typically used by lawyers as a tactic to gain an advantage of some kind or to protect their clients’ interests. But there is no reason why you shouldn’t use the approach too.  

A strategically written without prejudice letter will put pressure on your employer to consider settlement at an earlier stage. This is particularly likely to be true if it helps make your employer consider how they might be perceived by a judge if they do not engage in settlement discussions.

Similarly, if the prospects of your case are not particularly good, then this can protect you from having to pay the other side’s costs if you have made a low offer. 

So, if the fortunes of the parties in the example above were reversed, and your employer wins and you lose, an offer previously made by you to settle at £8,000 might not save you from an adverse costs order, whereas an offer of £3,000 might.  

Ultimately, the award of costs is at the discretion of the employment tribunal judge so it is worth being aware of these issues when embarking on a claim in the tribunal.

Summary of without prejudice costs issues

  • Correspondence marked ‘without prejudice’ can only be shown to the court if both parties agree.
  • Correspondence marked ‘without prejudice save as to costs’ can be referred to by all parties when tribunal proceedings have been concluded in order for the court to assess cost applications.
  • So when a communication is marked as ‘without prejudice save as to costs’ it remains confidential between your employer and you (and your respective legal representatives) but only until the tribunal case has ended.

Next steps

If you would like legal help with your employment tribunal case or have questions about the cost implications of hiring legal representation, Monaco Solicitors can help.

We are an established employment law firm, specialising solely in employment law and only representing employees.

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