The Employment Appeal Tribunal (EAT) has granted an application for the respondent to repay the appellant's fees of £1,600 in the  case of Horizon Security Services Ltd v Ndeze and another UKEAT/0071/14, following a successful  appeal. The judge stated that the general expectation would now be that a successful appellant  could recover any tribunal fees paid by him from the other party and set out the factors that the  tribunal will take into account when considering such applications.

Background

The introduction of tribunal fees in July 2013 led to revised versions of the procedural rules for  the employment tribunal and EAT, which gave tribunals the power to make a costs order requiring  unsuccessful parties to repay any tribunal fees paid by the other side. Rule 34A(2A) of the EAT  Rules 1993 now provides that:

"If the Appeal Tribunal allows an appeal, in full or in part, it may make a costs order against the  respondent specifying the respondent pay to the appellant an amount no greater than any fee paid by  the appellant under a notice issued by the Lord Chancellor." Following the introduction of the new rules, there has been little guidance or court or tribunal authority as to when cost awards would  be made to recover tribunal fees and what factors judges should take into account when assessing  whether to make such orders. Horizon Security Services Ltd v Ndeze and another gives us some  guidance.

Facts

In this case, the employment tribunal found for the claimant. The respondent, Horizon Security  Services Ltd (Horizon), successfully appealed to the EAT and the ET's decision was overturned.

In appealing to the EAT, Horizon had paid appeal fees totalling £1,600 (a £400 fee when lodging its appeal and a £1,200 hearing fee). Following the EAT's judgment in its  favour, Horizon applied for an award of costs against the claimant for the tribunal fees it had  paid.

EAT decision

Judge Eady QC considered the costs application and made the decision to make a costs award in  favour of Horizon for the full amount of the tribunal fees it had paid.

In making her decision, the judge commented that the introduction of fees had been a significant  change in the legal landscape and that the general principle was now that a successful applicant  should be able to recover the tribunal fees they had paid from the other party.

The judge stated that there were some factors that may temper this general principle, such as the  situation where an applicant had only been partly successful or where the other party could show  that they lacked the means to pay. Finding that neither of these factors applied in this case, the  judge made a costs award for £1,600 against the claimant.

Comment

This case confirms the position that the Government has been stating for some time in relation to  tribunal fees: that where a claimant or applicant brings a successful claim or appeal, they will  usually receive their money back from the respondent to cover the tribunal or EAT fees they have paid. 

Given that remission of tribunal fees is very difficult to obtain when issuing a claim or appeal, it follows that successful claimants  and appellants will usually be able to recover these costs from the respondent at the end of the  claim, unless the claimant or appellant has only been partially successful or the respondent is  able to persuade the tribunal that they are unable to pay the fees.

While recovery of tribunal fees is likely to follow the outcome of the matter, it will still only  be possible to recover other costs (such as legal costs) where it can be shown that the other party  has not followed tribunal procedure or has acted unreasonably in bringing the claim or in their  conduct during the tribunal process.

Employers should be prepared to have to pay the employee's tribunal fees if they lose in the  tribunal; tribunal fees should also now be factored in when calculating a claimant's potential  losses, for the purposes of settlement negotiations.