In what circumstances can an employment tribunal order one of the parties to pay the legal costs of the other party?

Employment tribunals can make awards for costs where a party, or his or her representative, has acted "vexatiously, abusively, disruptively, or otherwise unreasonably" or if the claim is "misconceived". This could be, for example, where a party has failed to comply with tribunal orders, behaved badly at the hearing or brought what is obviously a hopeless case. Costs can also be awarded where a party has caused unnecessary adjournments or postponements through poor preparation. Costs are awarded only in a small percentage of cases and the full costs of the "receiving party" are rarely awarded. When considering a costs order, the tribunal may have regard to the party's ability to pay.

As an alternative to a costs order, a "preparation time order" can be made in favour of a party that is not legally represented and has therefore not incurred legal costs. A "wasted costs order" can be made against a representative (rather than the claimant or employer) if the other party has incurred unnecessary costs due to the "improper, unreasonable or negligent act or omission" of that representative.