Costs News

02 July 2020
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Employment tribunal acted “unfairly” in making costs award in litigant’s absence

An employment tribunal acted unfairly in making an award of costs against a litigant in person in her absence, the Employment Appeal Tribunal has ruled.

His Honour Judge Auerbach also found that the tribunal in any event erred in failing to consider whether to take into account her means, or to explain whether, or how, it had done so.

In Pranczk v Hampshire County Council [2020] UKEAT 0272_19_1206, the claimant lost her claim for unpaid wages and lost annual leave entitlement. She did not attend the full merits hearing. The tribunal awarded the respondent £750 costs on the basis that the claimant had unreasonably continued with the litigation after the wages and leave claims had been satisfied.

She appealed both the substantive findings – which HHJ Auerbach rejected – and the costs decision.

The judge said the law was clear that, when considering a costs application, the first task of the tribunal was to decide whether the costs threshold has been crossed in the manner claimed – in this case by unreasonable conduct of the litigation.

But, if so, there was then a second-stage decision required: whether to make an award, and if so, in what amount – but it was not bound to do so.

Further, the tribunal may have regard to ability to pay, but again it did not have to do so – but if it did not, it should say why.

Here the claimant was warned in correspondence that, if she continued with the litigation and was unsuccessful, the respondent might make a costs application, and the scale of the costs that might be involved. But she was not told she could ask the tribunal to have regard to her means.

HHJ Auerbach said: “While the respondent was not under any duty to advise her of that, as such, what information she had in fact been given, was a relevant consideration when deciding whether or not to make a costs award in her absence.”

He found that the tribunal did not appear to have considered the question of what the claimant knew about a possible costs application, and did not know why she was not at the hearing. “It therefore did not have any proper basis to infer that, despite being warned of a possible costs application, she had consciously chosen not to attend, and not to advance any submissions in opposition to it.”

There was the potential basis for a finding that the claimant had acted unreasonably, he continued, “but that does not mean that she was bereft of points that she could have made; and it appears that the tribunal either was not given, or at least did not consider, the full picture regarding why she had continued with the litigation”.

Further, the tribunal either did not consider – or failed to record that it did – “not only whether the costs threshold was crossed, but if so, separately, whether in all the circumstances, an award should in principle be made… and, if so, whether to take account of her means, and, if so, to consider those means when finally deciding whether, and if so in what amount, to make an award”.

The failure to address these questions was, of itself, an error of law, HHJ Auerbach concluded.

“Further, given that the tribunal had no information about why the claimant had not attended, and could not be confident that she had had a fair opportunity to make submissions about her means, it could not have properly assumed that, in this case, that was sufficient reason not to consider them.”

The respondent did not seek remission of the costs issue.

Ms L Bone represented the appellant and Ms D Gilbert (instructed by Hampshire Legal Services) the respondent.

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