10 August 2018 #Employment
The Court of Appeal held in Office Equipment Systems v Hughes that even where a party is debarred from contesting liability at a hearing, they should normally be permitted to contest remedy.
In Hughes the Respondent failed to submit a defence by the specified time limit (and the tribunal refused an application to extend the deadline made after the original deadline date), so liability was found in favour of the Claimant. When the Respondent asked to participate in the remedy hearing, the tribunal refused (save for being allowed to comment on how the net awards should be “grossed up”). The Respondent appealed. The Court of Appeal (overturning the EAT and original ET decisions) upheld the appeal, deciding that the Respondent could defend all issues other than liability.
While some cases determine liability and remedy in the same hearing (so written submissions could be made on remedy and sent in advance), more complex hearings often have separate liability and remedy hearings. The Court of Appeal held that it would only be in exceptional circumstances that a Respondent could be barred from a remedy hearing, and even more exceptional to not be able to rely on written representations on remedy.
While the above provides useful clarity, it is clearly pivotal that employers respond to claims they receive. As tribunal judgments are now published online, an automatic ruling against a Respondent for failing to submit a defence in time will be available for all to see and may cause reputational damage. Tribunals allow 28 days for responses to claims to be lodged, so actions need to be taken quickly. In Hughes, the key employee instructing on the case being on long term sick when the claim was received was not a justifiable reason for failing to make the deadline (or failing to make an application for an extension prior to the deadline). In nearly all scenarios, legal advice on compiling the response will be prudent.