Section 22: Payments in respect of preparation time
62.This section also inserts a new section 13A into the Employment Tribunals Act 1996. It gives the Secretary of State power by regulations to authorise tribunals to order that one party make a payment to the other in respect of the time spent in preparing the other party’s case. It is not intended that the parties should have to provide detailed evidence of the actual time they have spent preparing for a case, but that the tribunal should make an assessment based on guidelines to be set out in the Employment Tribunal Rules of Procedure. It is intended that the new awards could be made only in the circumstances in which a costs award may be made at present, that is, where the party’s case is misconceived, or they or their representative have behaved vexatiously, abusively, disruptively or otherwise unreasonably.
63.The new section 13A provides that the regulations on costs and preparation time must include a provision that the tribunal may not make an award of both costs and preparation time in favour of the same person in the same proceeding.
64.The amendments made by section 22 also contain specific powers for the procedure regulations to allow tribunals to take into account a party’s ability to pay when making a costs or preparation time award. This is because a recent Court of Appeal decision in Kovacs v Queen Mary & Westfield College and the Royal Hospitals NHS Trust ruled that a tribunal may not take into account a party’s ability to pay when making a costs award. The Government believes that the tribunal should have the discretion to consider a party’s means, where appropriate. This will be given effect in the regulations.