Excluded defendant given chance to contest £75k damages award

Excluded defendant given chance to contest £75k damages award

The Court of Appeal has ruled that a company who was ‘debarred’ from a liability trial should still be able to contest a future compensation remedy.

Lord Justice Bean said that the case was complex enough that the company must be given the opportunity to participate in a hearing before an employment judge.

In Office Equipment Systems Ltd v Hughes, the defendant in the employment tribunal lost liability judgement by default after failing to file a response within the required time.

The defendant company claimed staff sickness was the reason behind the missed deadline, but an employment judge concluded there was no reasonable explanation for the delay and decided against granting a time extension.

The tribunal subsequently issued a judgement upholding claims for unfair dismissal, unpaid holiday pay, unpaid wages, sex discrimination and breach of contract. Two months later the tribunal issued ‘draft findings’ in the remedy decision and awarded the claimant almost £75,000 in total.

Office Equipment Systems Ltd had already launched an appeal against the decision on liability but also added an appeal against its exclusion from participating at the remedy hearing. The liability challenge failed with it being rendered conclusive, but the Court of Appeal decided that the debarring order should not affect the remedy hearing in such a significant claim.

Lord Justice Bean added: “In a case which is sufficiently substantial or complex to require the separate assessment of remedy after judgment has been given on liability, only an exceptional case would justify excluding the respondent from participating in an oral hearing.”

The judge said there was no rule that a party debarred from defending a claim should always be entitled to participate in a remedy hearing, but on this occasion he round no reason to bar the company from making submissions on damages and said it would have been best to invite the company to do so by a specified date.