Mr R Mervin v His Majesty’s Revenue and Customs — 2024

This judgment concerns a costs application by the Respondent (HMRC) following a liability hearing whose written reasons were sent to the parties on 4 March 2024. At liability, the Tribunal had dismissed the Claimant's complaints of direct disability discrimination, harassment, and failure to make reasonable adjustments, concluding that each was misconceived from the outset. The home-working adjustment had already been put in place, the Claimant was a high performer not disadvantaged by any targets, and the harassment claim rested on internal emails the Claimant had only seen via a DSAR and which he had not in fact regarded as creating a hostile environment.

The Respondent applied for costs under rule 76(1)(a) and (b) of the 2013 Tribunal Rules, on the grounds that the claims had no reasonable prospect of success and that the Claimant had acted unreasonably in bringing and conducting the proceedings. The Respondent's schedule of costs totalled £55,587.60 but the application was limited to £20,000. The Tribunal applied the two-stage threshold/discretion test, found the threshold met, and exercised its discretion to make an order, having regard to the Claimant's means.

At the third stage, the Tribunal had regard to the Claimant's income and to the wider household income (including his parents' state pensions, which he managed), assuming a combined net household income of approximately £33,680 a year against outgoings of approximately £1,520 a month. It concluded that £20,000 was not within the Claimant's reach but that £5,000 was, taking into account the likelihood of a payment plan with his government department employer and scope to reduce discretionary outgoings. The Tribunal accordingly ordered the Claimant to pay £5,000 as a contribution towards the Respondent's costs.