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In the UK and Isle of Man, a costs order may be made by an
Employment Tribunal to cover associated hearing costs of a party.
However, Jersey's Employment Tribunal (the Tribunal) does not
have this ability at present.
The issue of whether costs should be awarded by the Tribunal is
a topic of much debate. The general thrust of argument against
equipping the Tribunal with powers to award costs is that there
should not be a financial deterrent that potentially prevents a
worker from bringing an employment claim for fear of an adverse
costs order. An alternative view is that the ability to award costs
would be a sensible deterrent to try and prevent respondents
needlessly incurring time and cost defending claims which have
little or no merit.
Looking across the pond, the Guernsey Employment Tribunal has
adopted an inventive approach by permitting costs to be awarded in
certain circumstances. The Employment Protection (Recoverable
Costs) Order 2006 provides no costs may be recovered by a party in
respect of legal presentation costs, however, some costs and
expenses are recoverable by a party such as witness costs,
administration costs and the party's own costs.
An interesting situation arises when a respondent has accepted
unfair dismissal of an employee and is prepared to pay what it is
obliged to under the Employment (Jersey) Law 2003 (the Law). Due to
the Tribunal's inability to award costs, what protection is a
respondent afforded in such circumstances when an applicant seeks
to attend a hearing despite being offered everything it can expect
to recover?
In a case founded on a similar background, Simon Hurry acted for
the respondent. Despite the respondent's concessions of
procedural unfair dismissal and the amounts that were payable
pursuant to the Law, the applicant, a litigant in person, persisted
in attending a hearing. Importantly, the applicant was intent on
recovering amounts which the Tribunal simply could not award, which
included legal costs. The applicant also had the benefit of advice
from the Jersey Advisory Conciliation Service, who had
appropriately explained that these claims would not be considered
by the Tribunal. The applicant plainly ignored this advice, to its
detriment.
An open letter was sent on behalf of the respondent in advance
of the hearing setting out what the respondent was prepared to pay
and why a Tribunal attendance was both a waste of time and cost.
This letter was designed to protect the respondent's position,
and ultimately provided the foundation for an application under
Article 77F(10) of the Law which permits the Tribunal to reduce an
unfair dismissal award in circumstances which it considers
"just and equitable". The respondent recognised that it
could not recover any costs defending the applicant's claims,
with the only avenue of recourse being an attempt to discount the
unfair dismissal award.
Submissions were made that the pursuit of claims which are
outside the scope of the Tribunal's powers can only be
described as an abuse of process. Further, in respect of the
applicant's properly founded claims, amounts had been offered
pursuant to the Law well in advance of the hearing. The Tribunal
was drawn to the issue of setting a dangerous precedent in
permitting an applicant to behave in such a manner without being
subject to a discounted award.
The Tribunal was persuaded by the argument in support of the
application for a reduction. It held that the applicant had used a
day of the respondent's time and also the Tribunal's time
which could have been spent hearing cases where the areas of claim
are not agreed or conceded in advance of the hearing.
The Tribunal considered that in the circumstances it would be
just and equitable to reduce the applicant's compensation for
unfair dismissal by 65%, amounting to approximately
Ł18,500.
While the issue of costs awards will no doubt continue to be the
subject of rigorous debate in Jersey, the Tribunal's approach
provides reassurance that an applicant who seeks a hearing to
recover amounts which are either agreed, or outside the
Tribunal's jurisdiction, does not necessarily do so risk
free.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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