K Pilgrim v Jasmine Care (Holdings) Ltd

An Employment Tribunal's decision on costs is discretionary and must be assessed by considering the whole course of the relevant conduct. Costs remain exceptional. A Tribunal may permissibly find that late compliance with orders and failures to reply to correspondence do not meet the high threshold of unreasonable conduct where the remedy hearing was not delayed and no apparent prejudice resulted.

Under rule 75(3) of the Employment Tribunal Procedure Rules, “proceedings” means the whole claim from its presentation to final determination. The same party cannot obtain both a legal costs order and a preparation time order in that claim.

The claimant had substantively succeeded in Employment Tribunal proceedings. After the remedy hearing, she sought legal costs arising from the respondent's late compliance with case-management orders and repeated failures to respond to correspondence. The Tribunal refused the application on 21 October 2021.

During the appeal proceedings, the claimant obtained a preparation time order of £420 against the respondent for later unreasonable litigation conduct. She appealed the refusal of legal costs, contending that the Tribunal had failed to consider the whole picture and that the later preparation time order concerned separate proceedings. The central issues were whether the refusal disclosed an error of law and whether rule 75(3) permitted both forms of award.

1. Appeal dismissed. The Tribunal made no error of law in refusing a costs order. It correctly directed itself that costs are exceptional, that unreasonable conduct must meet a high threshold, and that the whole picture must be considered.

2. The Tribunal addressed the claimant's essential complaints. It recognised the respondent's tardy compliance and repeated failures to answer correspondence. It nevertheless found that the conduct fell short of the required threshold because the respondent complied, albeit late, two months before the remedy hearing; the response was detailed; the hearing was not delayed; and there was no apparent prejudice to the claimant in respect of that hearing. That was a permissible evaluative decision. A different Tribunal might have reached a different conclusion, but that does not establish an error of law.

3. The reasons were adequate. They were short but enabled the claimant to understand why the application failed and permitted appellate review. An appellate tribunal must read a decision fairly and not hypercritically.

4. Further and independently, rule 75(3) of the Employment Tribunal Procedure Rules barred a legal costs order after a preparation time order had been made in favour of the claimant. In that rule, “proceedings” encompasses the full course of a claim, from presentation of the ET1 to its final determination. It does not mean an individual costs application or a discrete stage within the claim. The Tribunal therefore had no jurisdiction to make a second award of legal costs in favour of the same party.

• Employment Appeal Tribunal: The appeal was dismissed. The Tribunal's refusal of legal costs was upheld, and the Tribunal would in any event have lacked jurisdiction to make a legal costs order after a preparation time order had been made.
• Employment Appeal Tribunal: On 29 March 2023, a preparation time order of £420 was made in the claimant's favour for unreasonable conduct occurring during the appeal proceedings.
• Employment Tribunal: On 21 October 2021, the Tribunal refused the claimant's application for a costs order following the remedy hearing.