Recent case-law on Costs in the EET

In Taylor v Manx Care (2025-19) (03.09.25), the EET Chairman, Douglas Stewart, held:

“Allegation of vexatious, abusive, disruptive and otherwise unreasonable conduct – Rule 40.

27. The Tribunal has become aware that such an allegation is now quite regularly advanced on behalf of Respondents by the Chambers of the Attorney General. Such an allegation is bound to be disturbing and would intimidate the typical Complainant – especially if without legal representation. In the present case, while I accept that the Complaint Form can be improved upon by way of Particulars, it is a far cry from Mrs Taylor’s proceedings ever having been vexatious, abusive, disruptive or otherwise unreasonable in the way they had been conducted. 
28. When linking these tags to a warning that Chambers may also be seeking costs is intimidatory… costs are very rarely awarded against a Complainant, even if unsuccessful. Rule 40(2) is clear that a Tribunal must not normally make a costs order. 
29. Any litigant taking on the weight, resources and experience of Chambers… must inevitably feel that the playing-field is far from level…  
30. The required balance between the parties under Rule 7 is difficult to apply in what unrepresented litigants regard as a David v Goliath situation. Lack of understanding of legal niceties ought not to stand in the way of Complainants “having their case heard.” Litigants with prima facie arguable cases should not be driven to abandon them or be struck out as has happened too often.  
31. … it is at least arguable that for any Respondent without clear grounds to allege vexatious etc misconduct under Rule 40(3)(a) (i) and then also adding a costs warning, may itself be behaving in a manner which is unreasonable… fairness within the overriding objective in Rule 7 seems to me to require that attention should be drawn to Rule 40 (2) and that costs are not normally awarded”.

The Tribunal made similar comments in Elliott v Manx Care (2025-45) (05.09.25) (§§ 27-32).

Key provisions on EET costs

Under Rule 40(2) of the Employment and Equality Tribunal Rules 2018, the Tribunal: “must not normally make” a costs order or preparation time order. Under Rule 40(3)(a), the EET can make a costs order or a preparation time order, and must consider whether to do so, where:

• in its opinion: (i) the paying party has: “in bringing or defending the proceedings, or he or she or his or her representative has in conducting the proceedings, acted vexatiously, abusively, disruptively or otherwise unreasonably”; (ii) the paying party’s complaint or response: “had no prospect of success”; or (iii) the paying party made: “a false or exaggerated allegation in his or her complaint or response or in evidence in support of it”;
• the paying party has been in breach of any order;
• a hearing has been postponed or adjourned on the application of the apaying party; or
• the Chairperson has decided under Rule 9(5) or Rule 12(4) that the paying party’s complaint or response should not be accepted (and this had been confirmed on a review).

An application for a costs order or a preparation time order may be made at any time during the proceedings (Rule 40(6)) and no later than 21 days from the date of the final judgment or order, unless in the interests of justice: Rule 40(7). An order for a specified amount not exceeding £2,000 can be made under Rule 40(10)(a). The whole or a specified part of the costs can be ordered under Rule 40(10(b), with the amount being determined by detailed assessment by the High Court, or by the Chairman.

Earlier examples of costs orders

The Tribunal only rarely awards costs. In Midghall v Unique Fire Protection Ltd (22-69) (12.12.23), the EET referred to: “its normal policy of making no costs award except in the most egregious of circumstances”.

In Ranson v DHSC (21/20) (02.05.23) (§§ 348-375), ordering 70% of the costs of the liability proceedings, the Tribunal held that: “In effect, when an order for costs is made, it is because of gross misconduct” (§ 348): the Tribunal should consider: “the gravity, nature and effect of the proposed paying party’s conduct” and “should look at “the whole picture”” (§ 351).

In Ranson, the Tribunal considered that the proceedings: “were conducted unreasonably and involved a false allegation (and indeed more than one)” (§ 351). It found it: “inexcusable for a Chief Executive such as Miss Magson to mislead both the Tribunal and Dr Ranson The case on liability was fought tooth and nail by the DHSC on a false basis to the substantial detriment of Dr Ranson and at the expense of taxpayers on the Isle of Man. Miss Magson knew that the denials of liability in the Response contained assertions and allegations that were untrue. She knew or should have known and understood that her pleaded arguments could never survive scrutiny once the documents which needed to be revealed were in fact disclosed” (§§ 364-365).

Prior to the 2018 Rules, orders for costs were made in:

• Sutton v Creechurch Capital Ltd (16/35) (09.08.18) (“the Respondent has acted vexatiously, abusively (to the due process of law) and otherwise unreasonably in their conduct at the original Hearing and on the Review”) (§ 274) (upheld on appeal: Creechurch Capital Ltd v Sutton (ORD 2018/41) (21.01.19) (§§ 67-69)) (in Avis v D 4 Doors Ltd (18/50) (14.02.19), the Tribunal stated (at p. 22) (“In-House Counsel for Creechurch deliberately misled the Tribunal by her representations during two Hearings and by concealment of critical, indeed pivotal, documentation”); and
• Manning v Templeton (14/29) (11.09.14) (unreported) (cited in Avis v D 4 Doors Ltd (18/50) (14.02.19) (p. 23), in which an offer to withdraw a claim without costs sanction was ignored, the Tribunal held that the claim had been conducted unreasonably to the prejudice of the Respondent, and awarded costs.

Tribunal decisions appealed to the High Court, however, are routinely subject to costs orders.

Note for practitioners: It remains extremely rare for the Tribunal to award costs.