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Employment Tribunal Procedure Update

Print publication

14/10/2014

Deposit Orders
Most employers will recognise the frustration of having to defend a weak or groundless Employment Tribunal claim. Huge amounts of management time can be taken up dealing with the claim not to mention the legal costs involved. Employers will therefore welcome the news that, since an employer-friendly change to the Employment Tribunal Rules of Procedure Regulations last June, there has been a notable increase in the number of deposit orders being granted against claimants. Such orders can be made where the Tribunal accepts the employer’s representations (normally at the preliminary hearing stage) that the case has ‘little reasonable prospect of success’. This also follows a general trend for Tribunals to be more open to awarding costs against unsuccessful claimants.

In a nutshell, if the Tribunal considers that any specific allegation or argument in a claim or response has little reasonable prospect of success, it can make an order (or more than one order if appropriate) requiring the party to pay a deposit (or deposits) of up to £1,000 per order as a condition of being permitted to continue to advance that allegation or argument.

As with applications for costs at the conclusion of a case, the key point to note is that the onus is squarely upon the employer (or their representative) to apply for a deposit order at the preliminary stage of the claim. The employer needs to be proactive in seeing the opportunity for and making the application. As the old adage goes, “if you don’t ask, you don’t get”.

In conclusion, applications for deposit orders (often coupled with a cost warning) can be an effective and valid litigation tactic and in some cases can dissuade the claimant from pursuing an unmeritorious case.

A stricter approach to applications for postponements and adjournment
The Small Business, Enterprise and Employment Bill 2014-15 is currently making its way through Parliament. It proposes Regulations:

  • Limiting the number of postponements or adjournments a party may apply for in an Employment Tribunal.
    Requiring a Tribunal to consider making an order for costs against any party who makes a late application to postpone or adjourn a hearing.

This is a positive development given that late applications for postponement or adjournment are most typically made by claimants or badly prepared representatives. If enacted, this change will recognise the often significant cost and disruption caused to an employer (and indeed its witnesses) when a hearing is postponed at the last minute.

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