Tribunal judges have been given a stark warning to use their powers to award costs against frivolous or false claimants, following a major case where an employee lied about suffering racial discrimination.
Last week, the Employment Appeal Tribunal (EAT) was forced to ask the employment tribunal to award up to £25,000 of costs against C Mathew, after it was held that she constructed a “deliberate and cynical” lie about being called a “black bitch” by her manager at Daleside Nursing Home.
The tribunal had not planned to award any costs despite ruling the case was fake, but were told to do so after the employer’s lawyer appealed.
Guy Lamb, head of employment at law firm DLA Piper, told Personnel Today: “This judgment sends a message from the EAT to employment tribunals saying ‘stop being so bloody soft and stupid’, and if there are issues where one of the parties has acted unreasonably, for whatever reason, then address it.”
Daleside’s lawyer, Paul Dumbleton, labelled the case as “monumental” in encouraging tribunals to be more assertive with their powers. “This is a case that will be referred to by many other employers when similar cases are brought against them,” he said.
Several HR chiefs have long called for employees to be made to pay employers’ costs when they lose a case at tribunal. Helen Giles, HR director at homelessness charity Broadway, previously told Personnel Today the threat of paying costs would be a “huge deterrent” to those looking to bring spurious claims.
Linda Dickens, industrial relations professor at Warwick Business School, added: “This case will reassure employers as it shows there is a penalty, and a significant one at that, for those bringing false cases.”
Lamb added: “This case will definitely reduce the number of false and vexatious claims made against employers. There must be some recognition that if you bring a claim you shouldn’t have, on purpose or not, there should be some risk in it.”