A v Home Office (UKBA) (Practice and Procedure: Costs)

An Employment Tribunal may award costs under Rule 76 where a party has acted unreasonably in bringing or conducting proceedings. Unreasonable conduct does not require disruptive, aggressive or otherwise improper behaviour during the hearing. Persisting with factual allegations which the party must have known had no basis can suffice.

Once the threshold is met, the costs decision remains discretionary. The Tribunal may consider the paying party’s means, but present affordability is not the essential criterion. A succinct explanation showing that means were considered and that the correct principle was applied is sufficient. An appellate tribunal will rarely interfere with a costs decision unless the Employment Tribunal has made an error of law.

The Claimant appealed against a Reading Employment Tribunal order requiring him to pay the Home Office £5,000 towards its costs. The underlying claims under the Disability Act and the Equality Act had been dismissed.

He contended that the costs order improperly relied on his conduct in workplace disciplinary proceedings rather than his conduct in the litigation. He also contended that the Tribunal had failed to take account of, or give adequate reasons concerning, his limited means. The central issue was whether the Employment Tribunal had erred in law in finding unreasonable conduct and in exercising its costs discretion.

1. Appeal dismissed. The Employment Tribunal was entitled to find that the Claimant had acted unreasonably for the purposes of Rule 76 of the Employment Tribunal Rules.

2. The relevant unreasonable conduct was not disruptive behaviour at the hearing. The Tribunal found that the Claimant had pursued allegations of discrimination which had no factual basis and which he must have known were baseless. He had made those allegations at work, advanced them in commencing the proceedings, and persisted in them through the hearing. That finding fell well within the Tribunal’s discretion.

3. The Tribunal had considered the whole picture, including the Claimant’s disability and the arrangements made for the hearing. Self-representation and ill health did not demonstrate an error of law in its assessment of the way in which he had brought and conducted the proceedings.

4. The Tribunal had also taken the Claimant’s means into account. Its reasons sufficiently showed that it understood affordability was not the essential criterion when setting the amount of a costs order. It was not required to give further reasons. Any question about instalments or payment terms was for the county court on enforcement.

5. Following the approach stated in Barnsley v Yerrekalva MBC [2012] ICR 420, costs appeals rarely succeed because the Employment Tribunal is ordinarily best placed to assess unreasonable conduct and exercise its discretion. No error of law was shown, and the £5,000 order stood.

• Employment Appeal Tribunal: dismissed the Claimant’s appeal against the costs order.

• Employment Tribunal, Reading: on 10 January 2014 ordered the Claimant to pay £5,000 towards the Respondent’s costs. The underlying claims had been dismissed; written reasons were sent in August 2013 and a corrected judgment was issued on 15 May 2014.