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    Tribunals – employer wins record £100,000 costs

    Employees who lose tribunal claims rarely have to pay costs. But one has just been ordered to hand her former employer £100,000. What happened?

    Over and out. When P Investments lost over £250,000, employee Debbie Smith was sacked from her position as managing director. But instead of going quietly, she launched a tribunal claim against her former employer for discrimination and victimisation. Ms Smith alleged that she had, in fact, been forced out of her senior position following “a stream of offensive and derogatory comments”. This included her boss, Tim Watts, apparently calling her a “sexy nurse”.

    Taking a stand. Apart from being her manager at the time, Mr Watts was – and still is – the owner of PerTemps, the parent company of P Investments. Incensed by Ms Smith’s “litany of lies”, he opted to fight her all the way through the tribunal. His tactics paid off when late last year it dismissed her claim branding it a “waste of time”. This decision strengthened Mr Watt’s resolve to fight for costs.

    New record. There’s usually a cap of £10,000 on costs at the tribunal and they’re rarely awarded to winning employers. In fact, from April 1 2009 to March 21 2010 this only happened 324 times and the median award was £1,000. It looked like an uphill struggle. However, Mr Watts has just secured another victory: he’s been awarded £100,000 – an unprecedented costs order against an employee. How did he do it?

    Assessed. Where the tribunal rules that a case is false or malicious, it can opt to ignore the cap. It then considers the employer’s costs down to the last penny via a process called detailed assessment. That’s exactly what happened here.

    Tip. If an employee threatens you with a claim, or you receive one, always put them on notice that you reserve the right to seek a tribunal costs order. That should focus the mind of anyone who tries it on.

    Where the tribunal decides that an employee’s allegations are false or malicious, it can assess their employer’s costs down to the last penny. If you’re ever threatened with a claim, warn that you will see costs.

    “Tips & Advice” 2.9.201