Scott v Russell

Costs orders in Employment Tribunals are discretionary. On appeal, the court should not reanalyse each item of conduct or require a precise causal link between unreasonable conduct and each part of the costs. It should consider whether the tribunal identified the relevant conduct and its effect and adopted a permissible broad-brush assessment. Once an unchallenged strike-out establishes that claims had no reasonable prospect and were scandalous or vexatious, it is difficult to argue that bringing them was not vexatious or otherwise unreasonable. Litigant-in-person status does not prevent a costs order. Persistence with a misconceived fresh-evidence appeal after direction as to the proper procedure may itself justify costs.

John Scott worked as a part-time office manager in the constituency office of Sir Bob Russell, MP. Following his summary dismissal, he brought claims in the Employment Tribunal for unfair dismissal based on a protected disclosure, sex discrimination and breach of contract.

The Employment Tribunal struck out the claims and ordered Mr Scott to pay Sir Bob’s costs. The Employment Appeal Tribunal dismissed his appeals and also upheld the Registrar’s refusal to admit fresh evidence, ordering a further £2,500 in costs. By the time of the Court of Appeal hearing, only the two costs orders were challenged. The central issue was whether the tribunals had erred in principle or acted perversely in exercising their costs discretion.

Beatson LJ gave the judgment of the court. McFarlane LJ and Laws LJ agreed. The court refused permission to appeal against both costs orders.

1. Challenges to Employment Tribunal costs orders are difficult because costs are discretionary and experienced judges may reasonably differ. Appellate courts should not use an over-analytic approach or seek to tinker with broad-brush first-instance assessments. The relevant question is whether the tribunal identified the conduct relied on and its effect and reached a permissible conclusion: Barnsley MBC v Yerrakalva [2011] EWCA Civ 1255 and Sud v Ealing LBC [2013] EWCA Civ 949.

2. Mr Scott no longer challenged the strike-out. It followed that the requirements of rule 18(7)(b) of the Employment Tribunals (Constitution and Rules of Procedure) Rules SI No 1861 of 2004 had been met: the claims had no reasonable prospect of success and were scandalous or vexatious. That created a formidable difficulty for the submission that their commencement could not itself have been vexatious or otherwise unreasonable.

3. The Employment Tribunal had identified substantial unreasonable conduct, including failures to comply with case-management directions, reliance on facts unsupported by credible evidence, pursuit of claims to circumvent the one-year qualifying-service bar, and the manner in which the proceedings were conducted. It was entitled to consider the totality of the circumstances. It was not required to apportion particular costs to individual acts of misconduct or establish a precise causal link between each act and each item of costs.

4. As to the Employment Appeal Tribunal costs, Mr Scott had been directed to the applicable fresh-evidence procedure and to the proper method for obtaining a note of evidence. He nevertheless persisted with a misconceived appeal. The EAT was entitled to regard that conduct as unreasonable and vexatious and to exercise its broad costs discretion under the Employment Appeal Tribunal Rules 1993. The fact that Mr Scott was acting in person did not alter the result.

1. Court of Appeal (Civil Division) The rolled-up application for permission to appeal was refused. The challenges to the Employment Tribunal and Employment Appeal Tribunal costs orders were not permitted to proceed.
2. Employment Appeal Tribunal By order dated 20 April 2012, the EAT dismissed Mr Scott’s appeals from the strike-out and costs decisions and upheld the Registrar’s refusal of fresh evidence. It ordered a further £2,500 in costs in respect of the fresh-evidence appeal.
3. Employment Tribunal The ET struck out the claims and ordered Mr Scott to pay Sir Bob Russell’s costs, subject to detailed assessment.