Joint Committee on Statutory Instruments Third Report


APPENDIX 3

Memorandum by the Department of Trade and Industry

EMPLOYMENT TRIBUNALS (CONSTITUTION AND RULES OF PROCEDURE) (SCOTLAND)
REGULATIONS 2001 (S.I. 2001/1770)
EMPLOYMENT TRIBUNALS (CONSTITUTION AND RULES OF PROCEDURE)
REGULATIONS 2001 (S.I. 2001/1771)

1. At its meeting on 8 May the Committee requested a memorandum about the above instruments on the following points:

    "(1)  Rule 12(11) of the Employment Tribunals Rules of Procedure (as set out in Schedule 1) provides that where that rule requires a document to be signed by the chairman but by reason of death or incapacity, the chairman is unable to sign it, the document must be signed by the other members or member of the tribunal, who must certify that the chairman is unable to sign. Explain the omission of a corresponding rule in the Rules set out in Schedules 4, 5 and 6.

    (2)  In rule 14(3)(a) (as set out in Schedule 1), the maximum amount which a tribunal may order a party to pay to another party in respect of the expenses incurred by the latter has been increased from £500 to £10,000. Explain the reasons for this sharp increase."

The first point

2. The above instruments are consolidations, with amendments, of the Employment Tribunals (Constitution and Procedure) (Scotland) Regulations 1993 (S.I. 1993/2688) and the Employment Tribunals (Constitution and Procedure) Regulations 1993 (S.I. 1993/2687). Schedules 3, 4 and 5 to the 1993 Regulations (which correspond to Schedules 4, 5 and 6 to the 2001 Regulations) did not contain a rule dealing with the death or incapacity of the chairman of a tribunal, and nor did their predecessor rules which date back to 1965. This has not caused any difficulties as far as the Department is aware. The Department does not consider it necessary to insert such a rule into Schedules 4, 5 and 6, for the following reasons.

3. The special procedures covered by Schedules 4, 5 and 6 (appeals by employers against industrial training levies, health and safety prohibition and improvement notices) are used in approximately 0.1% of tribunal cases, and contain shortened and simplified sets of rules compared to the main procedure for ordinary disputes contained in Schedule 1. Schedules 4, 5 and 6 confer on tribunals power to regulate their own procedure, subject to the provisions of the rules (rule 14(3), 14(1) and 12(1), respectively). In the unlikely event that a chairman was unable, by reason of death or incapacity, to comply with the requirement for him to sign the document recording the tribunal's decision, the other member or members of the tribunal could find an appropriate way of certifying the decision as being that of the tribunal. This would be done in reliance on their power to regulate their procedure.

The second point

4. Rule 14(3)(a) (as set out in Schedule 1) provides for the maximum amount which a tribunal may order one party to pay towards another party's costs, in the absence of agreement between the parties as to an amount, and without an assessment of those costs. Costs may only be awarded in the circumstances set out in rule 14(1), that is, where the first party has behaved unreasonably in some way. Between 1972 and 1993 there was no limit on the amount of the costs which a tribunal could award in this way. The Department considers that a limit is required but that £500 is far too low, in view of the high amounts of legal fees which can be incurred in respect of a tribunal claim.

5. There is already no limit on the amount of costs which can be awarded following an assessment, but the Department understands that the process of assessment is rarely used and adds to the costs of both sides. Tribunals therefore need a more realistic power to determine the amount of costs themselves.

6. The tribunal retains a discretion whether or not to make an order and as to the amount, and the Employment Appeal Tribunal has held that it is normally desirable for tribunals considering making costs orders to take into account the means of the party concerned. It may also be noted that the Employment Appeal Tribunal has power itseelf to make a costs order which is both unlimited and unassessed, in circumstances where proceedings were unnecessary, improper or vexatious (rule 34(2) of the Employment Appeal Tribunal Rules 1993 (S.I. 1993/2854)).

7. In the Department's view, the increase in the limit to £10,000 will act as a deterrent to opportunistic parties, while those with arguable cases who behave reasonably will have nothing to fear.

1 June 2001


 
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