Unless a Claim has been fully tried and tested, an Employment Tribunal is unlikely to award costs even where the allegations appear to be scandalous and vexatious.

In the recent case of Dean & Dean v Dionissiou-Moussaoui the Claimant made allegations of constructive dismissal and various sexual harassment and discrimination claims against her employer.

At the Pre-Hearing Review, the Employment Tribunal considered the Claimant's non-compliance with grievance procedures and the statutory time limits and dismissed most of her claims on that basis. The only ongoing claims were for victimisation and holiday pay.

In 2007 the Respondent sought an order for costs, arguing that the initial claims were misconceived and that the Claimant's behaviour was unreasonable. The Tribunal refused the application. The respondent appealed.

The Court of Appeal refused to award costs because they were not satisfied that they could exercise this discretion appropriately. Lord Justice Mummery said:

"In the exercise of its discretion it was relevant for the Employment Tribunal to take account of the fact that (a) the victimisation claim would continue against Dr Mireskandari (the Respondent) and (b) if the other matters had proceeded to a hearing, they would have contested. In that event the Employment Tribunal would have had to decide whether the serious allegations against Dr Mireskandari were true or false. However, as the claims were struck out on jurisdictional grounds, there never would be any testing of the evidence, or determination of the disputed facts, or the merits of those claimant a substantive hearing before the Employment Tribunal. In those circumstances it was not possible for the Employment Tribunal to conclude that the contested claims were false, or were, for that reason, misconceived, frivolous or vexatious."

Lord Justice Mummery upheld the Tribunal's refusal to award costs, agreeing that the Tribunal had assessed the matter on the basis of the facts available, and this was a fair and adequate outcome.

This case highlights the difficulty employers face in recovering costs incurred in defending Tribunal claims, which are struck out or withdrawn at the Pre-Hearing Review stage.

If you would like further advice on any of the issues raised in this article please contact Rachel Brown on 01277 268365 or rbrown@wortleybyers.co.uk.

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