Show me the money: Court of Session rules diligence on the dependence can be granted in Employment Tribunal claims

A recent decision by the Inner House of the Court of Session held that Scottish Courts have the ability to grant protective orders against an employer’s assets even where claims have been brought against them in an Employment Tribunal.

The case

The petitioner, Ms Anwar, successfully brought a case against her employer in the Employment Tribunal for discrimination and harassment and was awarded a substantial sum of compensation by way of remedy. However, she was unable to implement the award. It was alleged that whilst the proceedings in the Tribunal were taking place, her employer had adequate funds to meet such an award. When the time came for her employer to pay the award, the funds were no longer available. As a result, she was unable to enforce her award to the full extent.

Effective remedies

The discrimination case and subsequent remedy is rooted in EU directives prohibiting sexual, racial and religious discrimination in the workplace. As such, member states must provide effective remedies for the implementation of the community-based rights (Principle of Effectiveness), whilst also providing remedies that are equal to those available for similar claims not involving Community law (Principle of Equivalence).

Therefore, Ms Anwar raised proceedings in the civil courts on the grounds that Scots law did not provide her with an effective remedy to ensure she received her award and alleged that the failure to provide a remedy was in breach of EU law.

Protective diligence

Despite the ruling of the Lord Ordinary in the Outer House that Scots law did not allow such protective diligence, the Inner House found this not to be the case. Both Lord Drummond Young and Lord Malcolm ruled that diligence on the dependence was available in such a claim, and so a protective action of this sort could be raised in a Scottish court. This was despite their findings that, in this instance, there had been no breach of EU law.

In short, it can be rightfully assumed that Scottish civil courts are now able to grant protective orders against an employer's assets in some cases, even where claims are brought before the Employment Tribunal rather than in the civil courts.

What now?

So what does this mean going forward? It is widely accepted that as few as two thirds of all awards handed down by the Employment Tribunal are actually paid over to successful claimants. The reason for this can’t solely be attributed to employers failing to have sufficient funds to pay. A more likely reason is that simple enforcement mechanisms don’t exist or aren’t effective. As this case shows, the reality is that a further expensive bout of litigation through the courts is the only real solution.

The decision here is a triumph for claimants and we may see more individuals utilising this decision, to protect their potential award. However, only time will tell and the reality of individuals raising separate actions in both the Employment Tribunal and Sheriff Court seems somewhat unlikely.

This article was co-written by Laurie Anderson.

Employment Law at MacRoberts

Our Employment Group is the longest established specialist team in Scotland, and our clients include some of the best known employers across Scotland and the wider UK.

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