B.L.I.S.S Residential Care Ltd v Teresa Eileen Fellows

Where the Employment Appeal Tribunal substitutes the only lawful determination for that of an employment tribunal, it may exercise the tribunal’s costs jurisdiction in disposing of the appeal. A costs application may therefore be made after the substituted EAT judgment.

A costs threshold is met where a claim extension application, or resistance to an appeal, has no reasonable prospect of success. The tribunal retains a discretion over whether and in what amount to award costs. Ability to pay, including a realistic prospect of future recovery from a third party, may be considered. A speculative possibility of recovery does not require a substantial award.

The employment tribunal had held that it was not reasonably practicable for the claimant to present her unfair-dismissal claim within the primary time limit. In the related appeal, the EAT held that this conclusion involved an error of law, allowed the appeal and substituted dismissal of the claim as time-barred.

This costs judgment determined the respondent’s application for costs incurred both in the employment tribunal and on appeal. The central issues were whether the EAT could determine tribunal costs after substituting its own judgment, whether the claimant’s attempt to extend time and resistance to the appeal were misconceived, and the effect of her means.

1. Costs order made. The EAT awarded the respondent £1,000 costs. It held that the threshold for costs was met in both the employment tribunal and the EAT.

2. Under section 35(1)(a) of the Employment Tribunals Act 1996, the EAT could exercise the powers of the employment tribunal when disposing of an appeal. Where it substituted a decision for that tribunal’s decision, it could therefore determine costs incurred below rather than remit the matter solely for a costs application. This approach accorded with Sol (Vale) v Jaggers, UKEAT/0218/16/DA.

3. Applying rule 76(1)(a) of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013, the judge held that the claimant’s application to extend the primary limitation period had no reasonable prospect of success. The claim had been late because of her solicitor’s error. Since the only lawful conclusion was that presentation in time had been reasonably practicable, both the extension application and resistance to the appeal were misconceived and doomed to fail.

4. The satisfaction of a costs threshold did not compel an award. The employment tribunal is generally costs-free, and the absence of a costs-warning letter may affect discretion or amount, though it does not bar an order. The respondent had sent a warning letter concerning the appeal.

5. The claimant was presently impecunious. The EAT could take account of her ability to pay and of possible future improvement, including a potential claim against former solicitors. That prospect was speculative and did not justify treating recovery as assured. A modest award was consequently appropriate.

• Employment Appeal Tribunal: In the related appeal, the EAT allowed the appeal from the employment tribunal and substituted a judgment dismissing the claimant’s claim as out of time. This costs judgment determined the consequential application for costs.
• Employment tribunal: It had held that it was not reasonably practicable for the claimant to present her claim within the primary time limit.