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Tribunal troubles: costs and fees

BY Gerry O'Hare
Employment Law & HR
BG Purple

Two recent employment tribunal decisions have shone a spotlight on judges’ views towards costs and repayment of fees. In general, employment tribunals are reluctant to award costs to victors, an attitude very much at odds with other forms of litigation where expenses are awarded as a matter of course to the successful party.

At the heart of this stance is the principal that the employment tribunal is a more informal, accessible forum for both employers and employees where legal representation is not required. However, as employment legislation has grown in size and complexity the associated legal costs for employers and employees continue to mount. 

While costs awards are rare, the recent case of Chadburn v. Doncaster & Bassetlaw Hospital NHS Foundation Trust is an example of an employment judge taking a robust view of liability for legal expenses in light of the Claimant’s unreasonable conduct. The tribunal ruled that the Claimant had fabricated claims against their former employer. Consequently, the judge directed that the Claimant was responsible for the legal costs incurred by the Respondent.  

A tribunal has discretion to award costs altogether, but equally has discretion to take into account the Claimant’s ability to pay when making an award. In this case the tribunal did not hesitate to award full costs regardless of evidence to the effect that the Claimant had limited means to pay. 

The employment tribunal fee regime offers some redress for employers since one of the aims of the system is to discourage spurious and costly claims. However, while tribunals can be slow to award costs, they are certainly not slow to order losing employers to pay the claimant’s fees. Fees are not awarded automatically, but where such an order is sought the evidence thus far is that tribunals will most likely grant it. 

A recent case has examined whether it was equitable to award fees to a group of employees which initial fee outlay was paid by their union. The tribunal held that the claimants' union was acting as their agent in making the payments, and that the fees were, therefore, "paid by" the claimants for the purposes of making a costs order under the ET rules.

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