Costco Wholesale UK Limited v Jaiden Nash

An Employment Tribunal considering an application to extend time for presenting a response must assess all relevant circumstances under the overriding objective. The explanation for delay, prejudice to each party, and the apparent merits of the defence are important considerations, but none is a rigid threshold or automatically decisive. The Tribunal may assess each party’s prejudice as part of its overall judgment, rather than deciding which party would suffer the greater prejudice. A lengthy or deliberate default, and an untruthful explanation, may outweigh an arguable defence and prejudice caused by refusing participation. An appeal against the exercise of this discretion is concerned with error of law, not a rehearing of the evaluative balance.

Costco appealed against the Employment Tribunal’s refusal to extend time for presenting its response to Mr Nash’s complaints of direct race discrimination and race-related harassment. The response was submitted approximately ten months late. The Tribunal found that correspondence sent to the warehouse had been ignored and that the General Manager had deliberately deleted and ignored emails concerning the proceedings. It rejected Costco’s explanation for the delay and concluded that the interests of justice did not require an extension.

The appeal alleged errors in the assessment of prejudice, the merits of the proposed defence, and the overall interests-of-justice assessment. The central issue was whether the Tribunal had erred in law in exercising its discretion under Rule 20 of the Employment Tribunal Rules 2013.

1. The appeal was dismissed. The Employment Tribunal had not erred in law in refusing to extend time.

2. Under Rule 20 of the Employment Tribunal Rules 2013, read with the overriding objective, the Tribunal must take account of all relevant factors. The guidance in Kwik Save Stores Ltd v Swain [1997] ICR 49 identifies the explanation for delay, the balance of prejudice and the merits of the defence as important considerations. It does not create hard and fast rules or thresholds.

3. The Tribunal was entitled to consider the prejudice to both parties as components of its final assessment. It was not required first to determine which party would suffer greater prejudice. It could take account of delay to the claimant, the wider effect on the administration of justice and other litigants, and the respondent’s responsibility for the prejudice arising from its default.

4. The Tribunal was entitled to find that the very substantial delay lacked a satisfactory explanation and that the explanation given was untruthful. The existence of an arguable defence did not require an extension. The Tribunal could assess the apparent strength of the defence and conclude that it did not countervail the serious default.

5. The Tribunal’s reasons, read fairly and in the round, adequately explained its conclusion. The EAT should not conduct a rehearing of the discretionary balance or adopt a pernickety approach to the reasons, but must intervene where the Tribunal has failed to address the correct legal questions. The Tribunal had addressed the relevant matters and its decision stood.

• Employment Tribunal: Employment Judge S Knight refused the application to extend time for presenting the response after a hearing on 14 February 2024. The judgment was sent on 20 February 2024 and written reasons on 7 March 2024.
• Employment Appeal Tribunal: The appeal against that decision was dismissed. [2026] EAT 85