Tribunal in difficulty over a costs award

The Employment Appeals Tribunal has overturned a cost award made by an Employment Tribunal because it believed the tribunal should have disqualified itself from hearing the costs application due to the criticisms they made of the Claimant during their judgment.

The Facts

Mrs Oni’s claims of constructive unfair dismissal, race discrimination and victimisation against NHS Leicester City (the NHS) were dismissed in their entirety by the Leicester employment tribunal. In its detailed reasons, the tribunal raised serious concerns as to the basis of Mrs Oni’s allegations, and criticised the way in which she had given evidence. In one example of this the tribunal stated:

“In our view, not only was the bringing of the various claims unreasonable, but the manner in which they have been conducted was also unreasonable”.

Following a costs hearing the same tribunal ordered Mrs Oni to pay all of the NHS’s costs. Mrs Oni appealed the decision to the EAT holding that the tribunal was pre-disposed to making this cost order which was obvious from the judgement and should have recused themselves.

The EAT’s Decision

The EAT found that, in this case, the tribunal had pre-judged the issue of costs. It found that although a tribunal dealing with the question of liability may make findings about a party’s credibility or conduct, it should not express concluded views which anticipate arguments on the question of cost, saying:

“A tribunal should not reach or express concluded views which anticipate arguments on costs which have not yet been put before it.”

What does this mean for costs awards?

Will this decision cause tribunals to be more careful when it comes to cost applications? Or will this mean more tribunals referring cost applications to a differently constituted tribunal, the consequence of which would of course be a higher cost for all parties involved, including the tribunal system which will have to allocate more cases to other Tribunals in an already over worked and overwhelmed system.

For Respondents, it is hope that this will not make tribunals less inclined to give costs orders such as the one given in the case of Mrs Oni, entirely because of the fear of it being appealed due to the possibility of bias.

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