Will employee contract claims be stymied by increase in Civil Court fees?

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Whilst the Employment Tribunal is the most common forum for resolving employment disputes, it is not uncommon for senior, highly paid or bonused employees to bring contractual claims against employers in the civil courts. HR and employment practitioners should therefore be aware that Civil Court fees have increased significantly as from 9 March 2015 with fees now being calculated as 5% of the value of the claim up to a maximum fee cap of £10,000. This represents an enormous increase on previous civil court fees as the following table demonstrates.

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The Law Society, along with other legal professional bodies, has criticised the extent of these fee increases and has commenced the process of applying for a judicial review. Concerns have been expressed that the fee increases will discourage individuals from taking their cases to court and may provide an incentive for larger companies to deny liability.

Successful claimants will be able to recover their fees as part of their claim but it is clear that the increased fees may cause some to think twice before issuing proceedings or at least provide a greater incentive to attempt to reach a pre-claim settlement.