Tan v Copthorne Hotels: Employee ordered to pay £432,000 in costs

Although the substantive case of Tan v Copthorne Hotels Limited dates back to 2016, it has recently made headlines due to the outcome of a subsequent costs hearing in which the tribunal ordered the claimant to pay just over £432,000 in costs to his former employer.

Those familiar with the workings of the employment tribunal will know that the tendency is for each party to bear their own costs, with costs orders only being made in exceptional cases, and so the imposition of such a huge figure on a claimant covering ostensibly all of the respondent's legal costs is shocking, not only due to the scale of the award, but also because it was against an individual claimant, rather than against an organisation. 

The claimant's employment as Senior VP with the hotel began back in 2012 and was terminated by reason of redundancy in February 2017, following which he lodged a claim with a litany of complaints including for unfair dismissal (automatic and ordinary) unlawful deductions, race, sexual orientation, marriage, disability, and age discrimination (including pay discrimination), victimisation, harassment, and whistleblowing detriment.

In a preliminary hearing, the allegations of age, sex, and marriage discrimination, and unlawful deductions were dismissed, and subsequently the whistleblowing detriment claims and certain allegations of harassment were also withdrawn.

The remaining claims were then heard over nine days from September 2018, with a bundle covering more than 3,000 pages. It is reported that deposit orders had been made in respect of some of the claimant's heads of claim which the claimant nonetheless proceeded with. The tribunal found a number of alleged incidents to be out of time, that the dismissal for redundancy was fair, and that none of the remaining allegations were made out on the facts. The tribunal therefore dismissed all of the claimant's claims.

The successful employer then sought costs against the claimant (perhaps on the basis that the claimant's claims were many, but that none of the allegations had been met with any success) and a detailed assessment then took place over a further five days in September 2020. Following the hearing, the Claimant was ordered to pay in the region of £278,000 in respondent's costs, an additional amount of around £28,000 pursuant to the Civil Procedure Rules, interest on the amount at around £14,000, and approximately £111,000 (plus interest) on an indemnity basis for the detailed costs hearing. All in all, the total awarded was a little over £432,000.  

Commentary

Whilst there are no reasons given for the imposition of such a large costs award against the respondent, we assume that some or all of the following aspects of the case may have led the costs tribunal into concluding that the claimant's conduct of the case, or his bringing of claims with little prospect of success, merited the imposition of the award at that level. It appears that the claimant had:

• made some claims which arose from a previous period of employment, which had been the subject of a settlement agreement from 2010.
• had some of his claims subjected to deposit orders, which he nonetheless proceeded with.
• submitted a 61 page witness statement (of 357 paragraphs) which covered claims previously withdrawn.
• made thousands of hours of covert recordings, much of which was transcribed and included in the 3,000 page hearing bundle, including conversations with colleagues, and occupational health, and company drivers. The liability tribunal had also found that the claimant was aware that this was wrongdoing, which "eroded trust and confidence" and which would have entitled the respondent to dismiss him had it known of the recordings; and taken an approach of making numerous claims against the respondent, none of which the tribunal found were made out.

In coming to its decision, the costs tribunal would likely have taken into account that the individual was senior in status, with an annual salary of six figures, including bonuses and other benefits, and was therefore perhaps more able to pay.

Claimants should therefore be alive to the possibility of a tribunal making a cost award against them where they insist on pursuing numerous claims irrespective of the prospects of success, do not reflect on deposit orders made (indicating that a claim's prospect of success should be carefully considered), and/or where their conduct of a claim wastes tribunal resources (such as by presenting lengthy witness statements and transcripts which are perhaps not material to the issues). Employers may wish to note that the facts of the above case were quite extreme, and it is perhaps likely that in most cases, any cost awards will remain at the lower levels more typically seen historically.  

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