Workers are often threatened by employers with crippling costs when bringing their claims at tribunal. This is intended to blackmail the workers into dropping their claims. In the case of Simms v McKee 2006, the Employment Appeal Tribunal(EAT) has awarded costs against an employer as a warning to stop this unfair practise.
This case is instructive in showing the very legalistic nature of tribunals nowadays, and how the petty legal minutiae can make it very difficult for an unrepresented worker to secure his rights, despite the often helpful attitude of tribunals to such unrepresented ‘claimants’. In this case the date of dismissal was unclear. The employer had a meeting with the employee on 19th November, where some sort of compromise agreement was signed. The the employee (incorrectly, as decided later by the tribunal) believed he was then dismissed. He then put in an ET1 which starts off the tribunal process on December 8. The employer however terminated the employee's work later on in December, and paid him up until December 30th. In the ET3 (Employer’s defence to the ET1), it was argued that the employee had not been dismissed at all. A pre-hearing was called in April to decide on whether the Claimant had actually been dismissed. There was no mention of a problem with the dates. By the time of the pre-hearing 3 1/2 months had passed and the case was thrown out because it was out of time. The employee’s claim was ‘premature’. He had claimed too early for being unfairly dismissed.
That could have been the end of the matter. The employee believed that because the employer had originally agreed that the date of the employee leaving the service was correct, then the employee could not have known that the original application was ‘pre-mature’. Since the claimant didn’t know there was a problem with the dates, then he could hardly be expected to try and rectify that problem by making a new claim, within the time limit, after 30th December.
The respondent(employer) claimed that the case was now out of time, and should be dismissed. The tribunal agreed that the case was out of time, but that under Section 111(2) of the ERA (Employment Rights Act 1996), the tribunal had the power to extend the time limit where it was, “satisfied that it was not reasonably practicable for the complaint to be presented before the end of that period of three months".
As the respondent had not attempted in advance of the pre-hearing to correct its original agreement that the Claimant’s dates were correct, the tribunal decided that it was reasonable to allow a new application that had been made by the claimant. In the response to the second application, the employer threatened the claimant with a costs action, stating that the claim was vexatious and an abuse of process.
Apart from stressing the need to make applications to tribunal in a timely manner, the EAT said that employers who threaten workers taking claims against them with costs actions, are in danger of having to themselves pay costs to the worker.
Although Workrep has called for the total abolition of costs at tribunal this ruling is most welcome. The very wide use of costs threats by employers representatives to frighten workers away from using the tribunal system is sadly very effective. It is estimated that up to 50% of claims at tribunal initiated by unrepresented Workers, are subsequently dropped, when their former employers hire their local legal hit men to send out their threatening letters.
As costs on failure at tribunal can now potentially reach £10,000 WorkRep believes it is easy to understand why a worker will abandon his case, no matter how good it is, whether it is about discrimination or harassment or unfair dismissal etc. If a worker has been made redundant, she/he can always look for a new job, and pick up the pieces. If an employee thinks he/she might be hit with a £10,000 bill for a lost tribunal case, the potential devastation that could be caused is just to much for a worker, often on the minimum wage, to take.
In reality, costs awarded by tribunals average £1,000, and are only awarded in rare circumstances, such as if there has been something unreasonable in the conduct of, or in the bringing of a case. The criterion in applying for costs are however wider than this, and can be a source of worry, even when the employee has acted reasonably.
WorkRep applauds the EAT for this new costs decision. Employers are now going to have to be more careful when using the tactic of threatening workers with a costs application, as the money for could well end up in the worker’s pockets.
If you are running your own tribunal case and are threatened with costs by your employer, you should keep note of any such harassment. It comes usually in the form of threatening correspondence, often right at the beginning of the case. File the correspondence, and use it as evidence to request a Preparation Time Order once you have won your case.
The Employment Tribunal was originally intended to enable any worker to plead his own case, without having need for legal knowledge. That was never the case, and even less so nowadays.
Don't be bullied by your employer or ex-employer. No matter what sort of case you are bringing, whether of discrimination, unfair or wrongful dismissal, of harrassment or victimisation etc, you do have rights. Do not be frightened out of claiming those rights. The threats of costs are usually just a bluff, and can usually not be backed up if you run your case efficiently and in a cooperative fashion.
The use of unfair tactics can now rebound against the perpetrators.