Deposit Order Employment Tribunal

Application for a Deposit Order Employment Tribunal

We can assist you in making a formal application to the Employment Tribunal (ET) for a Deposit Order. This is a powerful case management tool designed to discourage the opposing party from pursuing specific parts of their case that are unlikely to succeed, thereby saving you time, cost, and anxiety.

Our assistance focuses on applying for the Deposit Order Employment in the Tribunal order and rigorously demonstrating that the specific arguments advanced by the opposing party do not meet the statutory threshold for rejection.

I. The Power and Purpose of a Deposit Order

A deposit order requires a party (the depositor) to pay a sum of money (up to £1,000 per argument) to the tribunal as a condition of continuing to participate in proceedings or pursuing specified allegations or arguments.

A. Making the Application

The tribunal has the authority to make a deposit order on its own initiative or following a party's application.

• Written Application

  We would prepare a written application, as Rule 31 of the ET Rules 2024 permits a party to apply for a case management order by sending a written application to the tribunal. Standard documentation exists for applying for a preliminary hearing that includes a request for a deposit order and/or strike-out.

• Alternative to Strike-Out

  It is common for a party to apply for an opponent's case to be struck out, or for one or more deposit orders to be made in the alternative.

B. The Legal Test: "Little Reasonable Prospect of Success"

To succeed in obtaining a deposit order, we must demonstrate that a specific allegation or argument in the claim (or response) has "little reasonable prospect of success" (Rule 40(1), ET Rules 2024).

Crucially, this test is less rigorous than the "no reasonable prospect of success" required for a strike-out.

We must provide the tribunal with a proper basis for doubting the opposing party's ability to establish facts essential to their claim or defence.

II. Crafting the Successful Application

Our strategy focuses on identifying weak points in the opponent's case and presenting evidence to demonstrate that they fail the "little reasonable prospect" test.

A. Targeting Specific Arguments

The tribunal can order a deposit of up to £1,000 for each specific allegation or argument it considers to have little or no reasonable prospect of success.

1. Multiple Deposits

   The total required deposit can exceed £1,000, as the tribunal has the power to order deposits for multiple specified allegations or arguments. For example, the Employment Appeal Tribunal (EAT) has upheld an order requiring a claimant to pay seven separate deposits for seven allegations.

2. Proportionality Check

   When applying for multiple deposits, we must bear in mind that the tribunal is required to step back and consider the total sum awarded, taking into account the question of proportionality.

B. Evidence and Argumentation

In challenging the opposing party's case, we focus on demonstrating internal flaws and contradictions without conducting a "mini-trial".

Factual Analysis

We help test the factual account advanced by the opponent "through the prism of reality," examining the case against basic logic, internal inconsistency, or any contradiction by contemporaneous documentary evidence.

Avoiding Disputed Facts

We recognise that significant disputed matters of fact should not be determined at a deposit order hearing, as doing so would defeat the objective of the interlocutory procedure. Therefore, if the prospect of success turns on disputed factual issues, a deposit order is highly unlikely to be appropriate.

Litigants in Person

If the opposing party is a litigant in person, we ensure their case is ascertained not just from their explanation at the hearing, but also from the pleadings and any key documents.

III. Addressing the Depositor's Ability to Pay

Even if we succeed in showing the argument has little reasonable prospect of success, the tribunal must consider the opponent’s financial situation.

Mandatory Inquiry

Before fixing the level of the deposit, the tribunal must make reasonable enquiries into the paying party’s (the depositor’s) ability to pay the deposit and take this into account.

Proportionality

The purpose of the deposit order is to cause a party to reflect, but not to prevent the pursuit of a claim or case. If the sum is disproportionately high, it may be found to be an error of law because it impedes the depositor's access to justice.

Financial Details

The tribunal is required to determine a party’s income and outgoings to assess their disposable income and calculate the amount they can pay, taking into account factors such as their take-home pay, tax, and pension deductions.

IV. Consequences of a Successful Application

If the tribunal grants the deposit order, the consequences create significant pressure on the opposing party:

Strike-Out for Non-Payment

If the depositor fails to pay the deposit by the specified date, the specific allegation or argument to which the order relates will be struck out. The consequence is then treated as if no response had been presented (if the reaction was struck out), meaning the tribunal may proceed to judgment on the remaining issues.

Costs Risk

If the deposit is paid, but the tribunal later decides the specific allegation or argument against the depositor for substantially the same reasons as set out in the deposit order, the depositor will be treated as having acted unreasonably in pursuing that specific allegation or argument. This significantly increases the likelihood that the tribunal will order them to pay your costs or compensate you for your preparation time. If a costs award is made, the deposit paid by the opposing party is then used to settle that award.