06 January 2017

Deposit Orders must not be used in such a way that they "impair access to justice", an Employment Appeals Tribunal (EAT) has found.

Such sums may be charged to claimants or respondents before a case goes to tribunal if a judge deems their argument to have little chance to success, and have been increasingly used to deter "weak" claims since the Coalition government passed employment tribunal reforms, including doubling the cap on Deposit Orders to a maximum of £1,000 per allegation.

A the recent case of Hemdan v Ishmail & Ors, a claimant who was a victim of trafficking was originally charged £75 each for three allegations of race discrimination at employment tribunal. As the claimant's only income was Employment Support Allowance of £125.05 per week, it was argued the sums charged were unaffordable and therefore barred the claimant from accessing justice. The judge originally stated that this was "the purpose" of Deposit Orders.

But an EAT disagreed, ruling that "the purpose of a deposit order is ... emphatically not ... to make it difficult to access justice or to effect a strike out through the back door".

"Accordingly, it is essential that when such an order is deemed appropriate it does not operate to restrict disproportionately the fair trial rights of the paying party or to impair access to justice. That means that a deposit order must both pursue a legitimate aim and demonstrate a reasonable degree of proportionality between the means used and the aim pursued," the EAT added.

The EAT set the claimants Deposit Order at a sum of £1 per allegation and noted that under Article 12 of the Council of Europe Convention on Action against Trafficking in Human Beings, she must be provided with adequate financial support.

This is an important ruling in the landscape of employment tribunal reform, after which it has been recognised that claims have fallen dramatically due to the imposition of prohibitive fees.

Our experts will discuss this decision, the government's new consultation for further employment tribunal reform, and how unions can resist barriers to access to justice, at our forthcoming Access to Justice conferences in Liverpool and London.

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