Employment Law Explained

Legal Costs - Who pays? (beware!)

Tribunals have the power to make costs orders against either party in a Tribunal claim up to £10,000 (or even more, if they send the case to a county court to assess the costs). These orders are becoming increasingly common and a matter that both parties need to have regard to in relation to the bringing or defending of a claim and/or their conduct in dealing with their claim.

This can include:

A late withdrawal of a claim
Failure to comply with Tribunal orders or directions
The bringing of a claim that fails, if it had no reasonable prospect of succeeding
A withdrawal of a case that never had reasonable prospect of success in the first place

It is worthy of note that we are aware of two cases where the Tribunal made costs orders against Claimants acting in person for £10,000 on each case for unreasonable conduct.

From 1st October 2004 - the ability of the paying party can be taken into account - ie. Whether the paying party has been awarded compensation in the proceedings; whether there is a third party involved ie. A union, who could meet those costs.

Costs orders can now also be made against a parties representative

Also preparation time can now be claimed by a party who is not legally represented.