Strike Out, Deposit Orders and Unless Orders in the Employment Tribunal

A Strike Out of a claim, or part of a claim, prevents that claim, or the relevant part of the claim, from proceeding any further.

Strike Out can be applied for at any stage of a claim, and can be applied for by a party, or can be initiated by the Tribunal itself, subject to the rules set out below.

The rules on Strike Out are contained in Rule 37 of the Employment Tribunal rules:

Rule 37(1) provides that: At any stage of the proceedings, either on its own initiative or on the application of a party, a Tribunal may strike out all or part of a claim or response on any of the following grounds— (a) that it is scandalous or vexatious or has no reasonable prospect of success; (b) that the manner in which the proceedings have been conducted by or on behalf of the claimant or the respondent (as the case may be) has been scandalous, unreasonable or vexatious; (c) for non-compliance with any of these Rules or with an order of the Tribunal; (d) that it has not been actively pursued; (e) that the Tribunal considers that it is no longer possible to have a fair hearing in respect of the claim or response (or the part to be struck out).

Rule 37 (2) provides that: A claim or response may not be struck out unless the party in question has been given a reasonable opportunity to make representations, either in writing or, if requested by the party, at a hearing. (a) Word substituted by the Employment Tribunals (Constitution and Rules of Procedure) (Amendment) Regulations 2014 (S.I. 2014/271). (b) OJ L 174, 27.6.01, p.1. 17 (3) Where a response is struck out, the effect shall be as if no response had been presented, as set out in rule 21.

A Strike Out application is made by a Respondent who believes that the claim being made against them is unfounded or weak, and wants to make sure that the claim will not proceed any further, costing them more money and time to defend. For example, this may happen where a Claimant has filed an ET1 but it has become clear as they set out their case that they do not have sufficient evidence of the allegations they are bringing.

Employment Tribunals should apply the test set out above in Rule 37 in considering striking out a claim, as the effect of this on a Claimant is very severe – a strike out means that the claim, or the relevant part of the claim, may not proceed any further. The Employment Tribunal may be reluctant to do this where the Claimant should have their day in Court to test the evidence, but in some cases it is clear that the claim should not proceed as the Claimant has no reasonable prospects of success.

A deposit order is also applied for by a Respondent where they believe that a Claimant’s case, or part of their case, is weak or unfounded, but the situation does not meet the test under Rule 37 above for a Strike Out. Sometimes Strike Out and Deposit Orders are applied for at the same time, as alternatives.

The rule on deposit orders is contained at Rule of the Employment Tribunal rules:

Rule 39 (1) provides that: Where at a preliminary hearing (under rule 53) the Tribunal considers that any specific allegation or argument in a claim or response has little reasonable prospect of success, it may make an order requiring a party (“the paying party”) to pay a deposit not exceeding £1,000 as a condition of continuing to advance that allegation or argument.

Rule 39 (2) provides that:  The Tribunal shall make reasonable enquiries into the paying party’s ability to pay the deposit and have regard to any such information when deciding the amount of the deposit.

Rule 39 (3) provides that: The Tribunal’s reasons for making the deposit order shall be provided with the order and the paying party must be notified about the potential consequences of the order.

Rule 39 (4) provides that: If the paying party fails to pay the deposit by the date specified the specific allegation or argument to which the deposit order relates shall be struck out. Where a response is struck out, the consequences shall be as if no response had been presented, as set out in rule 21.

Rule 39 (5) provides that: If the Tribunal at any stage following the making of a deposit order decides the specific allegation or argument against the paying party for substantially the reasons given in the deposit order— (a) the paying party shall be treated as having acted unreasonably in pursuing that specific allegation or argument for the purpose of rule 76, unless the contrary is shown; and (b) the deposit shall be paid to the other party (or, if there is more than one, to such other party or parties as the Tribunal orders), otherwise the deposit shall be refunded.

Rule 39 (6) provides that: If a deposit has been paid to a party under paragraph (5)(b) and a costs or preparation time order has been made against the paying party in favour of the party who received the deposit, the amount of the deposit shall count towards the settlement of that order.

Rule 38 of the Employment Tribunal Rules gives Employment Tribunals the power to make “Unless Orders”.

Unless Orders are usually applied for by a party where the other party has failed to provide information which has been requested previously. They are often used strategically to reduce the scope of a claim which might be quite broad.

Rule 38(1) provides that: “An order may specify that if it is not complied with by the date specified the claim or response, or part of it, shall be dismissed without further order. If a claim or response, or part of it, is dismissed on this basis the Tribunal shall give written notice to the parties confirming what has occurred.”

Rule 38(2) of the Employment Tribunal Rules provides that: “A party whose claim or response has been dismissed, in whole or in part, as a result of such an order may apply to the Tribunal in writing, within 14 days of the date that the notice was sent, to have the order set aside on the basis that it is in the interests of justice to do so. Unless the application includes a request for a hearing, the Tribunal may determine it on the basis of written representations.”

If an application for Strike Out, a Deposit Order or an Unless Order is made against you, it may be made in writing, or orally at a hearing. You should be given the opportunity to representations in response before any such order is made.

It will be important to respond within the time frame set out by the Tribunal, setting out point by point why you think it would not be appropriate for the Tribunal to grant the order, with reference to the Tribunal rules as appropriate.

It may be a good idea to draw the Tribunal’s attention to the following factors, if they apply to you:

• you are a litigant in person (unrepresented)
• you believe your conduct in the case, or your bringing the claim, to have been reasonable in the circumstances
• where there is a factual dispute between the parties, it may be best for the matter to be tested at a full hearing with all the evidence available, rather than the matter being prevented from reaching that stage. Discrimination claims are often fact specific, and it is difficult to assess their prospects of success without hearing all the evidence.
• Strike Out, Deposit Orders and Unless Orders should be used to help identify cases with no reasonable prospect of success, not to prevent access to justice
• or any other factors which may apply to your situation, e.g. in the case of a deposit order, your financial circumstances and ability to pay

It may also be helpful to refer to the appropriate aspects of Rule 2 of the Employment Tribunal rules (the “Overriding Objective”).