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Reimbursement of Fees Paid by Union

on Friday, 14 August 2015.

Can a number of discrete fixed-term contracts be linked by a series of similar acts of less favourable treatment spanning the entire period of the engagement?

And can a costs order for the reimbursement of tribunal fees be made where the fee is paid by a trade union?

Both issues were addressed by the Employment Appeal Tribunal (EAT) in Ibarz v University of Sheffield.

Under the Employment Appeal Rules, the EAT has the power to require an unsuccessful respondent to pay an appellant's fees in respect of the issuing of an appeal and the hearing fee. As we reported in March this year, the case of Goldwater and ors v Sellafield Ltd  previously established that costs orders of this kind cannot be made where those fees have been paid by a third party on behalf of the appellant.

In Ibarz v University of Sheffield, Mr Ibarz was a lecturer who was employed by the University of Sheffield (the University) on a series of consecutive fixed term contracts for over a decade. Each contract covered a semester with a number of weeks' gap between one contract ending and the commencement of the next during the holiday periods. Following the expiry of the last of these contracts, Mr Ibarz brought claims for less favourable treatment in terms of pay and benefits against the University based on his status as both a fixed-term and part-time worker.

Mr Ibarz sought compensation in respect of his entire period of his engagement dating back to 2004 but the Employment Tribunal (ET) concluded that a series of fixed term contracts did not constitute a 'series of similar acts' for the purposes of establishing a continuous course of less favourable treatment. The ET concluded that Mr Ibarz was out of time to pursue his claim in relation to all but the most recent contract in the series of fixed term contracts.

Mr Ibarz appealed on the basis that the ET had made an error of law and should have considered whether the University's application of its policies, procedures and practices throughout his total period of engagement between 2004 and 2013 amounted to a series of similar acts regardless of the fact that his engagement was comprised of a series of fixed term contracts rather than one agreement.

The EAT upheld the appeal and the case has been remitted to the ET to determine whether there was a series of acts running across the fixed term contracts, allowing Mr Ibarz to seek compensation for the disparity in his treatment right back to 2004.

Mr Ibarz's applied for reimbursement of his application and hearing fee, £1,600, paid by his trade union on his behalf. The EAT held that it would be contrary to public policy not to order that a losing party pay the fees incurred (even if they had been paid by a third party) simply because the monies would go to an insurer or trade union. The EAT disagreed with the previous decision in Goldwater which was based on a strict interpretation of the EAT Rules. It confirmed that it does have the power to order a respondent to repay fees even where they have not actually been paid by the appellant themselves. The EAT reached this conclusion on the basis that the fee provisions in the EAT Rules could only make sense if the wording 'or on his behalf' is added to references to the 'appellant'.

The EAT therefore ordered the University to pay fees paid by the trade union on behalf of Mr Ibarz.

Best Practice

Whilst it is still for the ET to determine whether a series of acts can span a number of discrete fixed term contracts dating back over a lengthy period, the EAT's decision to remit the case will be a course for concern for those organisations routinely using fixed term contracts. The Higher Education and Further Educations sectors, in particular, are likely to be affected if Mr Ibarz is successful.

As a matter of best practice it is important to ensure equity of terms, benefits and working practices between comparable fixed-term and permanent employees. Regular reviews should be carried out to reduce liability in this regard.

In terms of tribunal fees, this case clarifies that a costs order can be made against a respondent in respect of issue and hearing fees regardless of whether those fees were paid by a third party such as trade union or insurer. The repayment of fees is therefore a factor that must be considered by an employer in its analysis of cost liability.

For more information, please contact Jo Oliver in our Employment Law team on 0117 314 5361.

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