Those of you who know me will appreciate that I have something of a hang-up about costs awards in the employment jurisdiction and, in particular, the place of Calderbank offers.
A decision of the Court of Appeal last week has shed some light about the way in which Calderbank offers will be enforced. The case – Bluestar Print Group Limited v Mitchell – involved a question about the effectiveness of a Calderbank offer where the employee was offered a financial outcome which exceeded the award made at the end of litigation – but where the plaintiff sought “vindication” – and argued that the Calderbank offer could not be effective unless this need was also realised.
The Court of Appeal reiterated that a “steely” approach to Calderbank offers is required in employment cases, and that – whilst the importance of reputational factors must be taken into account – an offer to pay compensation at a level that is reasonable might well be regarded as conveying a distinct element of vindication to a plaintiff.
In other words, the fact that a plaintiff may be seeking an element of vindication through litigation does not mean that an effective financial offer will be rendered meaningless in the consideration of costs issues.
That, in turn, should act as encouragement for employers to make Calderbank offers, and for the employment tribunals to enforce them (when they are effective) by requiring employees to make payment towards the employer’s costs of litigation.
As anyone who has ever been involved in it knows, litigation can be a costly process. The general (civil court) principle is that the “loser” should make a contribution to the “winner’s” costs. Traditionally, that has meant payment of a fraction of actual cost (normally two thirds) – but in many cases even that is perceived as too light to be fair. 
