Awarding costs against the losing party

Employment Tribunal takes a stricter approach towards parties who incur unnecessary costs.

Where a party has acted unreasonably in pursuing a claim in the Employment Tribunal and has caused their opponent to incur unnecessary costs, the Tribunals seem increasingly willing to make awards of costs against the losing party. Two recent cases have exemplified this. In one case, an employee had been warned by the employer that they would be seeking costs if the claim was pursued and lost because it had little prospect of success; the employee was also told by the Judge to carefully consider their position. In spite of these warnings, the employee continued with their claim and lost. The employee was then ordered by the Tribunals to pay the employer’s costs of defending the claim in the sum of £43,000. In the second case, an employee brought 3 separate claims against an employer which culminated in a 20 day hearing which the employee lost. The employee was then ordered to pay a contribution of £87,000 towards the employer’s costs of defending the claims even though she was unemployed, of limited means and had not been issued with any costs warnings. The Tribunals’ willingness to take a tougher approach on costs towards parties who act unreasonably and cause their opponent to incur unnecessary costs is likely to act as a deterrent to employees launching speculative claims against their former employers.

If you require any employment advice or representation, whether you are an employer or employee, feel free to contact Alan Davidson for a consultation: 01756 692 869.

Alan Davidson,
Partner, Employment