Mr A West v David Lloyd Leisure Ltd: 2301428/2022 Mr A West v David Lloyd Leisure Ltd: 2301428/2022
EMPLOYMENT TRIBUNALS
Case No 2301428/2022
Between
Mr A WestClaimantDavid Lloyd Leisure LimitedRespondent
Before
Employment Judge WrightDate 16 February 2026
JUDGMENT
The complaints of discrimination on grounds of sexual orientation and victimisation are struck out.
REASONS
[1]The claimant was ordered to pay a deposit of £200.00 following a preliminary hearing held on 25 May 2023. The Order was sent to the claimant on 8 June 2023.The claimant has failed to pay this deposit. The complaints of discrimination on grounds of sexual orientation and victimization are therefore struck out under rule 39(4) of the Employment Tribunals Rules of Procedure 2013.[2]The hearing fixed for 29 November 2023 will take place in respect of the claimant’s claim of unfair dismissal only. LIABILITY JUDGMENT It is the Judgment of the Tribunal that the claimant’s claim under the Employment Rights Act 1996 is not well founded, it fails and is dismissed. 1/12/2023[1]It was the Judgment of the Tribunal that the claimant’s claim of unfairdismissal contrary to the Employment Rights Act 1996 (ERA) is not well founded, it fails and is dismissed.[2]The claimant presented a claim form on 28/4/2022 following a period of earlyconciliation which started on 19/2/2022 and ended on 1/4/2022. The claimant was employed by the respondent as a Personal Trainer (PT) from the 1/4/2014 and his employment terminated on 8/1/2022. The respondent is a provider of health, sport and leisure services, with 99 health clubs in the UK.[3]A case management hearing took place on 25/5/2023. At that hearing, theclaimant’s claims under the Equality Act 2010 (EQA) based upon the protected characteristic of sexual orientation were made the subject of a Deposit Order. The claimant did not pay the deposit and that claim was dismissed on the 16/8/2023.[4]At that preliminary hearing, it was recorded that if the claim proceeded todetermine the unfair dismissal claim alone (which was the only claim before the Tribunal once the deposit was not paid), the hearing would be reduced from three days to two days. That direction was never formally actioned and as such, the hearing remained listed for three days.[5]The preliminary hearing recorded the issues to be determined in respect ofunfair dismissal are: ‘Unfair dismissal23. The company says that Mr West was dismissed on grounds of his conduct.24. If so, did the company act reasonably in all the circumstances in treating that as asufficient reason to dismiss him? The Tribunal will usually decide, in particular, whether a) the company had a genuine belief in his misconduct b) made on reasonable grounds c) following a sufficient investigation and a fair process and d) dismissal was ‘within the range of reasonable responses’ open to anemployer in the circumstances?25. If the dismissal was unfair, did Mr West contribute to the dismissal by hisconduct? This requires the company to prove, on the balance of probabilities, that he committed the alleged misconduct.26. The burden of proof is neutral here but Mr West says that his dismissal was unfairbecause a) the first two allegations relate to events outside working hours at a social event,and in any event have been taken out of context and exaggerated; b) the real reason for his dismissal was because of the grievances raised in 2018.27. If the procedure was unfair, what difference would a fair procedure have made to the outcome?’[6]The Tribunal heard evidence from the claimant. For the respondent it heardfrom: Ms Charlotte Saunders, General Manager at Cheam.[7]The claimant was an evasive witness, he was hesitant, deflective; and when itsuited him, he referred to the time-lag as an excuse for not being able to answer a question. There was one particular answer in re-examination, in which the claimant appeared to have been coached (when he reference the preliminary hearing and the EQA claim). In contrast Ms Saunders was a straight-forward, honest witness who did her best to assist the Tribunal and made concessions when it was reasonable to do so. There was a marked contrast in the two witnesses.[8]For the purposes of this Judgment, Mr Alex West will be referred to as theclaimant and his representative (his father) will be referred to as Mr West.[9]There was an issue with the claimant’s representative. His representative onthe record (and noted as such in the ET1 page 14) is Mr John Tower of Tower Legal Services. Mr Tower did not represent the claimant at the hearing; his father did. The explanation for this was not clear. This matter was revisited at the conclusion of the hearing (see below).[10]There was a 284-page electronic bundle. Submissions were heard andconsidered.[11]The following findings of fact were reached by the Tribunal, on the balance ofprobabilities, having considered all of the evidence given by the witnesses during the hearing. This included the documents referred to by them and took into account the Tribunal’s assessment of the evidence.[12]Only relevant findings of fact pertaining to the issues and those necessary forthe Tribunal to determine, have been referred to in this judgment. It has not been necessary and neither would it be proportionate, to determine each and every fact in dispute. The Tribunal has not referred to every document it read and/or was taken to in the findings below but that does not mean it was not considered if it was referenced in the witness statements/evidence. Preliminary Matters[13]The hearing started on the 29/11/2023, day one of three. The claimant andMr West joined the hearing by telephone as they did at the preliminary hearing. There was therefore audio, but no video. Due to this the hearing did not start until 10.25am. The technology issue was discussed. Mr Proffitt made the point that the claimant had recorded on his schedule of loss that he had paid legal fees of £29,820 as at 15/6/2023 to Tower Legal Services (page 80). As such, he said it was not unreasonable to have expected the claimant’s legal representative to arrange for the claimant to be able to join the hearing via the internet, with sound and vision.[14]It was decided that in view of the listing of three days and in accordance withthe overriding objective, that the hearing would be adjourned until the following day. The claimant and Mr West would then attend the Croydon Regional Office in person and a hearing room would be set up so that they could join the hearing, via video from Croydon.[15]There was some discussion with Mr West regarding these arrangements,however, that was how the hearing proceeded.[16]There were discussions about preliminary matters. The respondent hadproduced a witness statement for Mr O’Connor the appeal officer. The appeal was a review, not a rehearing and Mr O’Connor upheld Ms Saunders’ decision to dismiss. The Tribunal was of the view that Mr O’Connor’s evidence did not assist it, in determining Ms Saunders’ decision to dismiss.[17]Similarly, Mr West wished to call Mr Johnny Proctor as a witness. There wasno witness statement served upon the respondent from Mr Proctor. The Tribunal was also told that Mr Proctor had attended the Tribunal in person on day one and had travelled from Preston (it is not clear why he did this when the hearing had been converted to a video hearing). Mr Proctor had provided a character witness statement for the claimant during the disciplinary proceedings (page 132). His evidence did not assist the Tribunal in deciding whether or not the dismissal was fair in accordance with the ERA. As such, an application to call him as a witness was refused.[18]The structure of the hearing was discussed and Rule 451 was applied. Two hours was granted for the total questioning of each witness. The claimant would give evidence first to ensure that his evidence was concluded whilst he was physically in Croydon. Thirty minutes each was given for closing submissions. Mr West then said that the claimant wanted to make a three hour opening statement. It was explained this was not permitted and that the claimant (or Mr West as his representative) would have the opportunity to made a closing submission with a time limit of 30 minutes. 1 Of the The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013.[19]Mr West made reference to the fact the claimant’s five-page witnessstatement was a ‘summary’. The Order for Directions was quite clear as to what the witness statement should include: ‘Witness statements 13. The claimant and the respondent must prepare witness statements for use at the hearing. Everybody who is going to be a witness at the hearing, including the claimant, needs a witness statement. … A witness statement is a document containing everything relevant to the issues to be determined by the Tribunal of which the witness has good knowledge and can tell the Tribunal about. Witnesses will not be allowed to add to their statements unless the Tribunal agrees. At the hearing the Tribunal will read the witness statements. Witnesses may be asked questions about their statements by the other side and the Tribunal. Witness statements should be typed if possible and using no less than a 12 point font. They must have paragraph numbers and page numbers. They must set out events, usually in the order they happened and using headings where appropriate. If the witness statement refers to a document in the file it should give the page number. They must also include any evidence about financial losses and any other remedy the claimant is seeking.’ [Emphasis added][20]The claimant’s witness statement did not contain any remedy evidence.[21]The suggested directions were sent to the parties on 16/12/2022. Thepreliminary hearing then followed and the matters the claimant needed to address in his witness statement were set out in that Order.
Findings of fact
[22]The claimant attended a Christmas party on 3/12/2021. The party was paidfor by the respondent, at a venue which it had arranged. It was immaterial whether or not there was a £10 contribution from staff. It was attended by staff only. The party continued after the formal event had ended and some of the attendees (including the claimant) went onto another venue and then onto a colleague’s (Mr Proctor’s) house, to continue as Mr West put it, further jollity (the after party).[23]That event led to complaints about the claimant which were made to theClubroom Manager. The complaints were:a. that on an unspecified date, the claimant put his hand on hiscolleague’s (MM) stomach and asked her if she was ‘expecting’;b. at the after party, the claimant said to a colleague (RL) ‘seriousquestion, are you a poofter?’; andc. the claimant made inappropriate comments to a colleague (JS), also atthe after party.[24]The Clubroom Manager investigated the complaints and he asked each of thecomplainants and witnesses to produce a written statement. Statements were produced from: MM on 13/12/2021 (page 90); AF undated (page 91); JM undated (page 92); JS undated (page 93); and RL undated (page 94).[25]Mr West made much out of the start of RL’s statement which said ‘please findattached updated statement’ followed by a paragraph relating to events which related to him at the after party on the 3/12/2023. The Tribunal find that the seven-line paragraph is in fact RL’s updated statement. Furthermore, RL’s statement is credible as he concedes that he would have been rather intoxicated by that point in the evening (around 11.30pm).[26]The claimant was suspended on 8/12/2021 (page 249).[27]That resulted in an investigation meeting on the 13/12/2021 at which theallegations were put to the claimant (page 102).[28]At the meeting, the claimant made an opening statement and then refused toanswer any questions (page 211).[29]Ms Saunders then reviewed the statements taken during the investigation andon 22/12/2021 invited the claimant to a disciplinary meeting (page 105). The claimant was informed that the allegations were of discrimination and sexual harassment, which amounted to potential gross misconduct. He was informed the allegations were: ‘• It is alleged that on 3rd December 2021, you made unwanted advances of a sexual and physical nature to fellow employees, [JS]. The company alleges that this allegation amounts to an assault of an indecent nature and, if substantiated in any way, represents a gross breach of trust and confidence and a breach of our duty of care to our employees.• It is alleged that on 3rd December 2021, you made comments of a discriminatory nature towards a fellow colleague, [RL], namely by asking ‘are you a poofter?’. This company alleges that this matter, if substantiated, represents a gross breach of trust and confidence and a breach of our duty of care to our employees.• It is alleged that you asked a fellow employee, [MM], and if she was expecting, andtouched her stomach without authorisation. This matter, is substantiated, demonstrate unprofessional and unacceptable behaviour.’[30]It is not clear why the first allegation is not specific, unlike the secondallegation. However, the nature of the conduct in respect of JS was put to the claimant in the investigation meeting, (page 211): ‘4.6 Did you make a comment when she bent over? Did you tell her to stop teasing you? 4.7 Do you see how this could be considered inappropriate and harassment? 4.8 What was [JS’s] response to you? 4.9 Did you ask [JS] to put her bum on the pool table so you could do a better shot? 4.10 Did you make a comment about how all PTs look at [JS] at work?’[31]The investigation meeting notes and the employees’ statements wereenclosed with the invitation to the disciplinary meeting (page 107).[32]The disciplinary meeting was rearranged due to the claimant’s annual leaveand it took place on 6/1/2022 (page 114).[33]There was an issue with the claimant breaching the terms of his suspension,which were that he could not use the respondent’s gym facilities, nor contact its members or employees; save that he could make contact through the Clubroom Manager (page 250). The claimant was also told that if there was someone he thought could assist in investigating the allegations against him, to contact the Clubroom Manager.[34]It came to the respondent’s attention that the claimant had entered the Epsomgym on five occasions between 16/12/2021 and 24/12/2021 (page 110).[35]On the 5/1/2022 the claimant forwarded five testimonials and a statementfrom Mr Proctor (page 120). The testimonials were dated 23/12/2021 (pages 127, 128, 129, 130) and 5/1/2022 (page 131). The statement from Mr Proctor was also dated 5/1/2022 (page 132). Mr Proctor’s statement said that he had no idea why the claimant had been suspended and then went onto recount a conversation with JS and to reference the event and the allegation she had made against the claimant.[36]It was put to the claimant that not only had he attended the Epsom gym tosolicit the testimonials from his clients, but also that he had discussed his suspension and in particular the reasons for it, with Mr Proctor. The claimant denied this. The claimant’s answers to questions in this regard were odd. He did not answer directly, said that he thought it was irrelevant or that he did not see the relevance of the question.[37]In respect of Mr Proctor’s statement, it was put to the claimant that it was aninsult to intelligence to suggest anything other than it was obvious he had asked Mr Proctor to write the statement. The claimant replied that it was not obvious at all and that he did not speak to Mr Proctor in advance about the allegations against him.[38]Ms Saunders accepted that there was never any question about theclaimant’s ability as a personal trainer. She said he was highly knowledgeable and good at his job; his abilities in the role were not in question and were not an issue.[39]The Tribunal finds the claimant did solicit the testimonials and the statementfrom Mr Proctor. The claimant could have approached Mr Proctor through the proper channels (via the Clubroom Manager). The testimonials were not necessary. The fact the claimant breached the terms of his suspension to obtain them demonstrates his fundamental misunderstanding of this whole process and situation.[40]In fact, Mr Proctor’s statement appears to corroborate that the first allegationdid happen and that the claimant made comments to JS which were unwelcomed and made her feel uncomfortable. It may well have been that she did not want to be responsible for the claimant being dismissed and she expressed that to Mr Proctor.[41]In any event, the respondent did not take any action in respect of theclaimant’s breaches of the conditions of his suspension.[42]The claimant attended the disciplinary meeting on the 6/1/2022. He made astatement and then did not answer any questions which followed.[43]The difficulty for the respondent, or in particular Ms Saunders, is that theclaimant did not engage in the process. He did not explain or excuse himself. He did not offer any mitigation. Most importantly, he did not offer any assurance that such actions would not happen again in future.[44]As submitted by Mr Proffitt, this left the respondent with absolutely noconfidence that the claimant would change his behaviour and that was a critical issue. There was therefore the risk for the respondent that such behaviour would happen again in future.[45]The claimant relies upon the motivation for the respondent taking disciplinaryaction as resulting from a grievance he raised on 16/10/2018 (page 89). The claimant provided a summary of the disciplinary action in one of his submissions to the Tribunal (page 67-68). The claimant has made no attempt to link his grievance in 2018 to the events which took place in December 2021.[46]Furthermore, the claimant and Mr West were adamant that this was a groundfor dismissal. It was not. It was poor formatting for the fourth bullet point to follow the three bullet points which covered the grounds for dismissal. That was all it was. All Ms Saunders did, was to acknowledge the point the claimant had made regarding his 2018 grievance.[47]The claimant appealed his dismissal. The appeal hearing (which was areview) took place on 1/2/2022 and Ms Saunders’ decision to dismiss was upheld.
The Law
[48]Section 94 of the Employment Rights Act (‘ERA’) states that an employeehas the right not to be unfairly dismissed by his employer.[49]Section 98 ERA states:(1) In determining for the purposes of this Part whether the dismissal of an employee is fair or unfair, it is for the employer to show— (a) the reason (or, if more than one, the principal reason) for thedismissal, and (b) that it is either a reason falling within subsection (2) or someother substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held(2) A reason falls within this subsection if it— (a) relates to the capability or qualifications of the employee forperforming work of the kind which he was employed by the employer to do, (b) relates to the conduct of the employee, (c) is that the employee was redundant, or (d) is that the employee could not continue to work in theposition which he held without contravention (either on his part or on that of his employer) of a duty or restriction imposed by or under an enactment. … (4) Where the employer has fulfilled the requirements of subsection (1), the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer)— (a) depends on whether in the circumstances (including thesize and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and (b) shall be determined in accordance with equity and thesubstantial merits of the case [Tribunal’s emphasis][50]The ERA requires the claimant to prove that he has been dismissed. The burden then shifts to the employer to prove the reason for the dismissal. If the respondent succeeds in showing a potentially fair reason for dismissal, there is a neutral burden for the purposes of determining whether or not the dismissal was fair.[51]If the respondent fails to show a potentially fair reason for a dismissal it isunfair. If a potentially fair reason is shown, the general test of fairness in s. 98(4) must be applied. The helpful test is the range or band of reasonable responses, a test which originated in the misconduct case of British Home Stores v Burchell [1980] ICR 303, but which has been subsequently approved in a number of decisions of the Court of Appeal.[52]The manner in which the employer handled the dismissal is important inconsidering whether the respondent acted reasonably in all of the circumstances in treating that reason as a sufficient reason for dismissing the claimant. A Tribunal will therefore be keen to find out that the process which led to the claimant’s dismissal was affected in an appropriate way, i.e., within the range of reasonable responses applicable to an employer of the size of the respondent with such administrative resources available.[53]It is important that in carrying out this exercise the Tribunal must notsubstitute its own decision for that of the employer.
Conclusions
[54]Ms Saunders had a genuine belief in the claimant’s misconduct. It wasreported by five employees and there was general corroboration of the allegations.[55]Ms Saunders also had reasonable grounds for that belief. The events werereported shortly after they had occurred. The employees who had made the reports were reliable members of staff and Ms Saunders spoke to them prior to the disciplinary meeting. To some extent, Mr Proctor’s statement on the 5/1/2022 corroborated her reasonable belief that indeed something untoward had taken place at the after party.[56]The investigation process was fair and reasonable. It complied with therespondent’s own policy and with the Acas Code. It is open to an employer to put the allegations to an employee in an investigation meeting, without prior notice. In some cases, that is the correct thing to do, before any collusion can take place.[57]The investigation has to be reasonable; not perfect. The Tribunal wasconcerned that in respect of the first allegation, it was put in a general sense, without specifics; the respondent did not set out what the unwanted advances were. This was however corrected by enclosing the statements which contained the actual allegations. Furthermore, the specifics of the allegation had been put in the investigation meeting. It should be made clear what the actual allegation is and specifically, what aspect of it the respondent considers to be the wrongdoing. That would have then avoided the difficulties Ms Saunders experienced when she was asked what aspect of the allegation amounted to a physical assault and she accepted there was no physical assault. However, the allegation as put does not actually say that there was a physical assault (that was a misrepresentation of the allegation).[58]The claimant relied upon the events taking place outside of working hours.The Tribunal was however satisfied that there was sufficient nexus or a link between the Christmas party and the after party for the misconduct to come within the respondent’s remit. It is a question of fact for the Tribunal to decide whether or not the allegation was in the course of the claimant’s employment. The ERA does not limit the conduct to that which took place solely in the workplace.[59]In Thomson v Alloa Motor Company Ltd 1983 IRLR 403, the EAT held that ‘conduct’ within the meaning of s.98(2)(b) ERA means ‘actings of such a nature, whether done in the course of employment or outwith it, that reflect in some way upon the employer-employee relationship’. In any event, it is accepted that the third event took place in the workplace.[60]In respect of the claimant’s contention that the event(s) were taken out ofcontext and were exaggerated; the difficulty was that he did not engage in the process. He did not offer his version of events or provide any context. He did not say during the process what had been exaggerated.[61]The claimant did not provide any rationale why the real reason for hisdismissal was the 2018 grievance, other than to make that statement. The previous incidents were not of the same nature as these allegations. Again, there was nothing to link the 2018 grievance to these allegations.[62]The Tribunal then considered whether or not the dismissal was within therange of reasonable responses open to an employer in the circumstances. As invited by Mr Proffitt, the Tribunal reminded itself that it is not to and cannot substitute its own view, for that of the respondent.[63]It does not have to be the case that every employer would dismiss in thesecircumstances; just that dismissal was an option open to a reasonable employer.[64]Particularly taking into account the lack of explanation from the claimant; himtacitly acknowledging he did put a question to RL in respect of his sexuality which was objectively offensive and the failure to give the respondent any assurances in respect of his future behaviour, the Tribunal finds that the decision to dismiss was within a range of reasonable responses.[65]Turning then to s.98(4) ERA, the respondent acted reasonably in dismissingthe claimant in the circumstances. In considering the equity and substantial merits of the case, there was nothing to suggest the claimant was treated differently to other employees. The dismissal was therefore fair.[66]For those reasons, the claimant’s claim is not well-founded and is dismissed. A matter which arose at the end of the hearing.[67]The fact the claimant was represented by Tower Legal Services was noted atthe outset. In particular, according to the schedule of loss, that the claimant had paid nearly £30,000 to his representative and yet he did not have the technology to conduct a video hearing was highlighted.[68]Under the Financial Services and Markets Act 2000 s.89M a claimsmanagement company who charges claimant’s fees for their services, has to be registered with the Financial Services Authority (FSA); this includes an arrangement on a contingency basis. Breach of which is a criminal offence. Tower Legal Services did not appear to be registered.[69]The claimant produced two schedules of loss. The first dated 16/3/2023 claimed ‘interim costs’ of £21,000 paid to Tower Legal Services (page 66). The second dated 15/6/2023 the claimant claimed interim costs of £29.820. This sum was included despite Employment Judge Fowell’s instruction: ‘An updated schedule of loss should be provided by 15 June 2023. It should reflect [the claimant’s] new employment and should not include any claim for legal costs’ (page 74).[70]After Judgment had been delivered, Mr West was asked whether the claimanthad paid any monies to Tower Legal Services? Mr West replied that that the claimant had not paid for anything, that there was a contingent fee agreement and that the claimant would not be asked to pay for anything. Mr West went onto to say that Tower Legal Services was a trading name for Questo Eperlei Ltd. Mr West said that he had made the point at the preliminary hearing the fees were for claims handling and that Tower Legal Services was not purporting to act as solicitors or barristers. Mr West said that Tower Legal Services was not registered with the FSA and that he was a statutory director of the company.[71]Notwithstanding the position vis-à-vis registration with the FSA, Mr Westseemed to be completely unaware that he and by implication the claimant, had just admitted to misleading the Tribunal. The claimant had made two separate claims for interim fees of £21,000 then £29,000 which he simply had not incurred or paid out.[72]Neither he nor Mr West took the opportunity to correct that impression whentechnology was discussed on the first morning of the hearing and the respondent made reference to the fees which the claimant claimed to have paid to Tower Legal Services.[73]Questo Eperlei Ltd t/a Tower Legal Services has seven days to confirm to therespondent and the Tribunal that it was in fact appropriately registered with the FSA in accordance with the Financial Services and Markets Act 2000. 13th December 2023
Conclusions
[1]A final hearing took place between 30/11/2023 to 1/12/2023. Written reasons were sent to the parties on 15/12/2023. Following that hearing, the Respondent made an application that the Claimant pay its costs on the 11/1/2024. That resulted in this one-day costs hearing being listed.[2]The Claimant (Mr Alex West) did not attend the hearing. He was represented by his father Mr Alan West (referred to as Mr West) as per the liability hearing. Mr West was acting in his personal capacity as the Claimant’s father. Mr West confirmed he was not charging his son for the representation. As such, Mr Proffitt did not object to Mr West representing the Claimant at this hearing.[3]At the conclusion of the final liability hearing, when the status of Tower Legal Services (TLS) was discussed (see paragraphs 67-73), Mr West set out the position. In two schedules of loss the Claimant had set out: Interim costs assessment to TLS £21,000 [on 16/3/2023]; and Interim costs assessment to TLS £29.820 [on 15/6/2023], Mr West said that the Claimant had not paid anything to TLS, that there was a contingent fee agreement and that the Claimant would not be asked to pay for anything. Mr West went onto to say that TLS was a trading name for Questo Eperlei Ltd. Mr West said that he had made the point at the preliminary hearing the fees were for claims handling and that TLS was not purporting to act as solicitors or barristers. Mr West said that TLS was not registered with the FCA.[4]Both Mr West and the Claimant are statutory directors of Questo Eperlei Ltd and the Claimant is the company secretary.[5]Further to the comments made in respect of registration with the FCA in the liability written reasons, at this hearing Mr West sought to distance TLS from the proceedings. He now contended that TLS was not a claims management company, that it was a family business, that TLS was not acting as solicitors, barristers or (now in addition) as a claims management company. He sought to define TLS as a ‘communications hub’.[6]Confusingly, Mr West also said that although TLS was not a claims management company, it had incurred costs in representing the Claimant. TLS had on the 21/2/2024 made a costs application against the Respondent. By definition, if TLS was making a costs application, it must have incurred costs which it was seeking to recover (acknowledging the actual costs application was signed off by the Claimant and the costs sought were not specified). Mr West said: ‘Questo Eperlei Ltd trading as TLS has incurred costs by spending a huge amount of hours when it was not accustomed to acting as a claims handler or a communications hub as one might say; and that that had distracted from other business the company [Questo Eperlei Ltd] may otherwise have been carrying out.’[7]Throughout, the Claimant’s representative has been listed as Tower Legal Services (TLS), as noted on box 11 of the ET1 (page 13). No individual representative was named in the ET1, however, when the first email on the Tribunal’s file was received on behalf of the Claimant, the covering letter indicated it was from TLS (rather than an individual), within the ‘towerlegalservices@hotmail.co.uk’ email address, it gave a name of John Tower. The remained the case until the most recent email dated 21/2/2024. The attachments to the emails (for example the Claimant’s costs application) were invariably signed off by ‘AJ West’; the Claimant. The Tribunal and the Respondent had communicated directly with the TLS email address throughout the litigation.[8]The Respondent specifically asked Mr West at the conclusion of the liability hearing whether John Tower was a ‘real person’? Mr West replied that he was ‘part of the organisation’. At this costs hearing Mr West said that John Tower had left the organisation since the preliminary hearing. It is curious that statement implies that John Tower left TLS after the preliminary hearing and before the liability hearing. Whereas, Mr West said at the liability hearing that John Tower was (present tense) ‘part of the organisation’. Those statement may be subject to a use of a tense or phraseology; however, they do contribute to the overall impression of a lack of candour from the Claimant and Mr West.[9]It should be noted that as an aside, the Claimant’s costs application had been made outside of the time limit specified in Rule 82 and the Tribunal declined to extend the time limit under Rule 5. The Claimant’s application was not therefore considered.[10]At the conclusion of the liability hearing, the status of TLS was discussed and Mr West confirmed TLS was not registered with the FCA. The Claimant was directed to confirm within seven days that TLS was properly registered.[11]Mr Proffitt submitted that for Mr West to suggest that TLS need not be registered with the FCA as it was subject to an exemption (that it was a charity or not for profit agency) was a major contradiction. Mr West said that the work conducted by TLS was not ‘claims management’; yet he then said TLS was exempt from registration with the FCA. That cannot be right and Mr Proffitt said he made no ‘bones’ about saying the Tribunal should infer one statement or the other is a lie.[12]Mr West made other implausible statements. For example, he said that it was a fact the Claimant did not receive any remuneration as a director of TLS. Making a statement does not demonstrate that it is a fact. Particularly when if the statement were true, it would be possible to evidence the same by providing details of the directors’ remuneration, or lack thereof.[13]A directions Order for the costs hearing were sent to the parties on 24/1/2024. The Claimant was directed to provide a written statement giving evidence of income, outgoings and assets relevant to his ability to pay any costs awarded. Any relevant documents were also to be provided to the Respondent. The Claimant did not comply with this Order.[14]There was no evidence produced to indicate that the FCA did indeed consider TLS to be exempt from the legislation and for the reasons already stated, the Tribunal was not prepared to accept Mr West’s assertions as ‘fact’. Furthermore, the Claimant was Ordered to produce any evidence which he wished to rely upon and he did not do so. Unevidenced statements were therefore not accepted.[15]The Claimant did provide a very short document (page 117):[16]The Claimant had previously supplied a copy of a payslip dated 28/7/2023 (page 131). It showed his employer as PfP Leisure Limited – Kingston. His pay for that month was £1,229.07 gross and £1,178.98 net. It showed his cumulative gross pay as £3,665.39. The Claimant had not disclosed any other documents. He did not explain the nature of this employment, when it started and whether or not it was ongoing. Unfortunately, this is indicative of the Claimant’s selective use of evidence when he deems it assists him, without an appreciation of the wider implications for him in the conduct of the litigation. There may have been a reasonable explanation for the difference in net pay in the two specific months referenced, however, that was not provided by the Claimant when he was expressly Ordered to do so.[17]The notice of the costs hearing was dated 19/1/2024. On the 23/1/2024 TLS applied for the hearing to be postponed. An email dated 20/1/2024 gave details of the Claimant’s travel itinerary. It showed that on 24/2/2024 there was a flight from Heathrow to Cancun, a transfer to a hotel and accommodation for one night. Then accommodation for three nights in one hotel, followed by three nights in another hotel, with a transfer back to the airport and a return flight to Heathrow on 2/3/2024, arriving on 3/3/2024. There was no other explanation in respect of the trip. Mr West referred to the Claimant being on holiday,[18]The Claimant therefore did not attend the hearing and did not apply for permission to give evidence from Mexico.[19]On the 20/1/2023 the Respondent had written a ‘without prejudice save as to costs’ letter to the Claimant (page 52). The Respondent pointed out the weaknesses in the Claimant’s case, including the claim of discrimination on the basis of sexual orientation (a claim which was subject to a deposit Order, which was not paid and which was subsequently dismissed). The Respondent proposed that the Claimant withdraw his claim, in return for which, the Respondent would not pursue him for its costs. It stated that if the offer was not accepted, it would apply for a public preliminary hearing to apply for the claim to be struck out or to be the subject of a deposit Order.[20]In giving a ‘costs warning’ the Respondent estimated its costs, should a final hearing take place, to be in the region of £17,000 + vat.[21]The Respondent’s costs application was set out in correspondence of the 11/1/2024 (page 100). It applied for costs under Rule 76(1)(a) and (b) of the ET Rules1.[22]The unreasonable conduct, the Respondent suggested, was the Claimant and Mr West’s conduct in respect of the purported legal fees incurred by TLS. It also referred to findings in the liability Judgment which it said, amounted to a finding that the Claimant had lied under oath.[23]The alternative contention was that the claim of unfair dismissal had no reasonable prospect of success and that the Claimant should not have had reasonable grounds for thinking he had prospects of success. Furthermore, the Respondent referred to its without prejudice save as to costs letter of 20/1/2023 and the fact that letter set out a clear basis for its contention and that from that date at the very least, its position was clearly set out. It also suggested the Claimant’s unfair dismissal claim was doomed to fail.[24]It appeared the Claimant misunderstood the legal test which the Tribunal applies to a unfair dismissal claim. He did not seem to appreciate that the test under the Employment Rights Act 1996 relates to the reasonableness/fairness of the Respondent’s conduct. Mr West instead focussed upon the 1 The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 Schedule 1. Respondent ‘proving’ the Claimant had committed the wrong-doing he was accused of. The law was set out in the liability Judgment.
The Law
[25]The material provisions of the ET Rules 2013 governing costs applications are excerpted below: Rule 74. Definitions(1) “Costs” means fees, charges, disbursements or expenses incurred by or on behalf of the receiving party (including expenses that witnesses incur for the purpose of, or in connection with, attendance at a Tribunal hearing). […] Rule 75. Costs orders and preparation time orders (1) A costs order is an order that a party (“the paying party”) make a payment to— (a) another party (“the receiving party”) in respect of the costs that the receiving party has incurred while legally represented or while represented by a lay representative. Rule 76. Where a costs order or preparation time order may or shall be made (1) A Tribunal may make a costs order or a preparation time order, and shall consider whether to do so, where it considers that— (a) a party (or that party’s representative) has acted vexatiously, abusively, disruptively or otherwise unreasonably in either the bringing of the proceedings (or part) or the way that the proceedings (or part) have been conducted; or (b) any claim or response had no reasonable prospect of success.(2) A Tribunal may also make such an order where a party has been in breach of any order or practice direction or where a hearing has been postponed or adjourned on the application of a party. Rule 77. Procedure A party may apply for a costs order or a preparation time order at any stage up to 28 days after the date on which the judgment finally determining the proceedings in respect of that party was sent to the parties. No such order may be made unless the paying party has had a reasonable opportunity to make representations (in writing or at a hearing, as the Tribunal may order) in response to the application. Rule 78. The amount of a costs order (1) A costs order may— (a) order the paying party to pay the receiving party a specified amount, not exceeding £20,000, in respect of the costs of the receiving party; (b) order the paying party to pay the receiving party the whole or a specified part of the costs of the receiving party, with the amount to be paid being determined, in England and Wales, by way of detailed assessment carried out either by a county court in accordance with the Civil Procedure Rules 1998, or by an Employment Judge applying the same principles; […](3) For the avoidance of doubt, the amount of a costs order under subparagraphs (b) to (e) of paragraph (1) may exceed £20,000. Rule 84. Ability to pay In deciding whether to make a costs, preparation time, or wasted costs order, and if so in what amount, the Tribunal may have regard to the paying party’s (or, where a wasted costs order is made, the representative’s) ability to pay.[26]When determining an application for costs, the ET should apply a three-stage approach:a. Is the relevant jurisdictional threshold in rule 76 met?b. If so, should the ET exercise its discretion in favour of making a costs order?c. If so, what sum of costs should the ET order?[27]For the purposes of rule 76(1)(a) the word “unreasonable” is to be given its ordinary English meaning and is not to be interpreted as meaning something similar to vexatious (Dyer v Secretary of State for Employment UKEAT/0183/83).[28]The Tribunal should consider the nature, gravity and effect of the unreasonable etc conduct, but it is appropriate to avoid a formulaic approach and have regard to the totality of the relevant conduct. As Mummery LJ explained in Yerrakalva v Barnsley MBC [2012] ICR 420, CA at §41: The vital point in exercising the discretion to order costs is to look at the whole picture of what happened in the case and to ask whether there has been unreasonable conduct by the Claimant in bringing and conducting the case and, in doing so, to identify the conduct, what was unreasonable about it and what effects it had […][29]It should, however, be noted that the Tribunal is not confined to making an award limited to those costs caused by the unreasonable conduct. As Mummery LJ confirmed in McPherson v BNP Paribas (London Branch) [2004] ICR 1398, CA:[39]Miss McCafferty submitted that her client's liability for the costs was limited, as a matter of the construction of rule 14, by a requirement that the costs in issue were "attributable to" specific instances of unreasonable conduct by him. She argued that the Tribunal had misconstrued the rule and wrongly ordered payment of all the costs, irrespective of whether they were "attributable to" the unreasonable conduct in question or not. The costs awarded should be caused by, or at least be proportionate to, the particular conduct which has been identified as unreasonable.[40]In my judgment, rule 14(1) does not impose any such causal requirement in the exercise of the discretion. The principle of relevance means that the Tribunal must have regard to the nature, gravity and effect of the unreasonable conduct as factors relevant to the exercise of the discretion, but that is not the same as requiring BNP Paribas to prove that specific unreasonable conduct by the applicant caused particular costs to be incurred. As Mr Tatton-Brown pointed out, there is a significant contrast between the language of rule 14(1), which deals with costs generally, and the language of rule 14(4), which deals with an order in respect of the costs incurred "as a result of the postponement or adjournment". Further, the passages in the cases relied on by Miss McCafferty (Kovacs v Queen Mary and Westfield College [2002] ICR 919, para 35, Lodwick v Southwark London Borough Council [2004] ICR 884, paras 23-27, and Health Development Agency v Parish [2004] IRLR 550, paras 26-27) are not authority for the proposition that rule 14(1) limits the Tribunal's discretion to those costs that are caused by or attributable to the unreasonable conduct of the applicant.[41]In a related submission Miss McCafferty argued that the discretion could not be properly exercised to punish the applicant for unreasonable conduct. That is undoubtedly correct, if it means that the indemnity principle must apply to the award of costs. It is not, however, punitive and impermissible for a Tribunal to order costs without confining them to the costs attributable to the unreasonable conduct. As I have explained, the unreasonable conduct is a precondition of the existence of the power to order costs and it is also a relevant factor to be taken into account in deciding whether to make an order for costs and the form of the order. 30. Mummery LJ did not resile from these observations in his later judgment in Yerrakalva, though he did emphasise in Yerrakalva that whilst the Tribunal is not limited to awarding those costs incurred by the receiving party as a result of the paying party’s unreasonable conduct, the ‘effect’ of the unreasonable conduct will often be a relevant factor in the Tribunal’s exercise of its discretion. 31. In circumstances where the Tribunal finds that the jurisdictional threshold in rule 76 is met, the Tribunal retains a broad discretion as to whether to make a costs order and the amount of any costs awarded. Whilst there is no closed list of factors relevant to the exercise of the Tribunal’s discretion, the following factors are often relevant:a. Costs orders are intended to be compensatory, not punitive (Lodwick v Southwark LBC [2004] ICR 884, CA). Therefore, the extent of any causal link between the unreasonable etc conduct and the costs incurred will normally be a relevant discretionary factor (Yerrakalva), albeit there is no requirement to establish a causal link between the unreasonable conduct and the costs incurred before an order can be made (McPherson).b. The paying party’s ability to pay is a factor which the Tribunal is entitled, but not obligated, to consider (see Rule 84). Where regard is had to the paying party’s ability to pay, that factor should be balanced against the need to compensate the receiving party who has unreasonably been put to expense (Howman v Queen Elizabeth Hospital Kings Lynn UKEAT/0509/12).c. Any assessment or consideration of means need not be limited to the paying party’s means as at the date the order is made. It is sufficient that there is a ‘realistic prospect that [they] might at some point in the future be able to afford to pay’ (Vaughan v London Borough of Lewisham [2013] IRLR 713, EAT).d. Where the Tribunal does decide to take the paying party’s means into account, it must do so on the basis of sufficient evidence (for example by the paying party completing a county court form EX140) (Oni v NHS Leicester City UKEAT/0144/12).e. There is no requirement to limit costs to the amount the paying party can afford (Arrowsmith v Nottingham Trent University [2012] ICR 159, EAT).f. The Tribunal may have regard to the means of a party’s spouse or other immediate family members (Abaya v Leeds Teaching Hospitals NHS Trust UKEAT/0258/16).g. Whether a party is legally represented may be a relevant factor. An unrepresented litigant may be afforded more latitude than a party who has the benefit of professional legal advice and representation (AQ Ltd v Holden [2012] IRLR 648, EAT). 32. In Radia v Jefferies International Ltd UKEAT/0007/18/JOJ the EAT said: ’61. It is well-established that the first question for a Tribunal considering a costs application is whether the costs threshold is crossed, in the sense that at least one of Rule 76(1)(a) or (b) is made out. If so, it does not automatically follow that a costs order will be made. Rather, this means that the Tribunal may make a costs order, and shall consider whether to do so. That is the second stage, and it involves the exercise by the Tribunal of a judicial discretion. If it decides in principle to make a costs order, the Tribunal must consider the amount in accordance with Rule 78. Rule 84 provides that, in deciding both whether to make a costs order, and if so, in what amount, the Tribunal may have regard to ability to pay.[62]At the first stage, accordingly, it is sufficient if either Rule 76(1)(a) (through at least one sub-route) or Rule 76(1)(b) is found to be fulfilled. There is an element of potential overlap between (a) and (b). The Tribunal may consider, in a given case, under (a), that a complainant acted unreasonably, in bringing, or continuing the proceedings, because they had no reasonable prospect of success, and that was something which they knew; but it may also conclude that the case crosses the threshold under (b) simply because the claims, in fact, in the Tribunal’s view, had no reasonable prospect of success, even though the complainant did not realise it at the time. The test is an objective one, and therefore turns not on whether they thought they had a good case, but whether they actually did.[63]In this regard, the remarks in earlier authorities, about the meaning of “misconceived” in Rule 40(3) in the 2004 Rules of Procedure, are equally applicable to this replacement threshold test in the 2013 Rules. See in particular Vaughan v London Borough of Lewisham [2013] IRLR 713 at paragraphs 8 and 14(6). However, in such a case, what the party actually thought or knew, or could reasonably be expected to have appreciated, about the prospects of success, may, and usually will, be highly relevant at the second stage, of exercise of the discretion.[64]This means that, in practice, where costs are sought both through the Rule 76(1)(a) and the Rule 76(1)(b) route, and the conduct said to be unreasonable under (a) is the bringing, or continuation, of claims which had no reasonable prospect of success, the key issues for overall consideration by the Tribunal will, in either case, likely be the same (though there may be other considerations, of course, in particular at the second stage). Did the complaints, in fact, have no reasonable prospect of success? If so, did the complainant in fact know or appreciate that? If not, ought they, reasonably, to have known or appreciated that?33. Mr Proffitt referred to Scott v Inland Revenue Commissioners 2004 ICR 1410 CA in which it was observed that ‘misconceived’ for the purposes of costs under the 2004 Tribunal Rules included ‘having no reasonable prospect of success’ and clarified that the key question in this regard is not whether a party thought they were in the right, but whether they had reasonable grounds for doing so. Conclusions34. The threshold in Rule 76 is met in this case. TLS were involved from the outset and the Tribunal was misled on numerous occasions as to TLS’ role and representation of the Claimant. That was unreasonable behaviour by either the Claimant or Mr West his representative. It may well have been the case that the directors of TLS did not appreciate the obligations to the FCA, however, the Claimant via Mr West continued to misrepresent the position of TLS to the Tribunal. TLS remains the Claimant’s representative, yet there was no evidence that it was exempt from FCA registration. It is against public policy for what was held out as a claims management company to represent a Claimant if it has not complied with FCA registration requirements. This amounts to unreasonable conduct.35. The nature, gravity and effect of the unreasonable conduct is in particular misleading the Tribunal in respect of TLS and its costs. The findings about the Claimant’s credibility and lack of frankness are set out in the liability Judgment.36. Furthermore, the unfair dismissal claim did not have reasonable prospects of success and certainly, the Claimant was put on notice of that from the 20/1/2023.37. The threshold having been met, the Tribunal is prepared to exercise its discretion in making a costs award. Misleading the Tribunal is serious unreasonable conduct.38. The costs the Respondent seeks are modest and were in the main incurred by junior members of staff (a trainee solicitor and a paralegal). Mr Proffitt’s fees were also reasonable. The costs sought of £19,641.48 (exclusive of vat) exceeded the estimated costs of £17,000 (exclusive of vat), however, the Respondent perhaps did not factor in the addition of the costs hearing. The Tribunal is prepared to Order that the Claimant pay to the Respondent its costs of £17,000 exclusive of vat.39. Other than the breakdown provided at paragraph 15, the Claimant did not provide any evidence further to the Order of 24/1/2024, much less proffer himself for cross-examination. Furthermore, the breakdown did not correlate to the one payslip disclosed. In fact, the Claimant was in breach of Rule 76(2), although the Respondent did not focus upon this and Rule 76(2) is not subject to the test of reasonableness, it focuses on whether or not there is simply a breach of Rule 76(2).40. The Tribunal was not therefore able to take into account the Claimant’s ability to pay any costs awarded in a substantive manner. The Claimant had the opportunity to comply with the Tribunal’s Order and did not do so. He cannot escape that obligation by absenting himself from the proceedings.
Conclusions
[1]This matter was remitted to the Employment Tribunal by HHJ Tariq Sadiq on the 9 December 2025. The parties agreed that the matter be considered upon the papers.[2]The EAT held: The appeal against the liability decision regarding unfair dismissal was unsuccessful. The appeal against the costs decision succeeded in one narrow respect only. The ET had not considered the effect of the unreasonable conduct and causation in accordance with the guidance given in Dowding v The Character Group Plc [2024] EAT 153 and had not adequately explained its decision in this respect.[3]The EAT said in paragraph 66 that the Tribunal does not need to identify a precise causal link between the conduct leading to the costs ordered and the amount of costs thereby incurred, it does need to give some consideration to what effects that conduct had, as well as its nature and gravity, and causation in that sense is not irrelevant (Dowding v The Character Group Plc [2024] EAT 153 citing McPherson v BNP Paribas [2004] ICR 1390 CA and Yerrakalva v Barnsley MBC [2012] ICR 420).[4]The unreasonable conduct found was the claim was misconceived and that it was unreasonably pursued and also, that the claimant and or his representative had engaged in unreasonable conduct by misleading the Tribunal as to the circumstances of TLS.[5]The two sources of unreasonable conduct identified and considered by the Tribunal to have the effect of causing the respondent to unnecessarily incur legal costs. Had the claimant recognised that his claim had no reasonable prospects of success and withdrawn it, particularly once the respondent had given a costs warning on the 20 January 2023, the respondent would not have incurred further costs.[6]The respondent referred to the claimant and/or his representative ‘playing lawyer’ and to a ‘game’. The Tribunal finds that Mr West (the claimant’s father) wished to appear that TLS was a substantive organisation which represented the claimant. It was not. Mr West could have easily represented the claimant as a lay representative. There was no need to pose as a quasi-legal representative. It added nothing to the representation. What it did do, was to cause the respondent to have to give the status of TLS additional consideration; instead of simply accepting Mr West was representing his son as a lay representative. It also caused the respondent and the Tribunal to have to raise additional questions about TLS. The respondent suggests that the correspondence with TLS added around £1,000 plus vat to its legal costs.[7]The claimant set out that TLS was a case management company to which he had paid fees, which was not registered with the FSA, but however was subject to an exemption (which was never properly evidenced). The fact the claimant misled the respondent and the Tribunal regarding TLS and that factor undermined his credibility.[8]Notwithstanding that however, the claimant’s case was misconceived (the unreasonable conduct) and taking into account the requirements of Rule 76(1)(a) and (b) and the relevant authorities, resulted in the Tribunal finding that conduct caused the respondent to incur unnecessary legal costs in defending the claim.[9]Although invited to do so, the Tribunal sees no basis for revisiting the amount of costs awarded to the respondent. Approved by: