Background
Jaiden Nash worked as a Members Services Assistant at Costco’s Chingford warehouse from July 2022 until his dismissal in September 2022, ostensibly for failing his probation. Having complained of race discrimination to the General Manager — complaints that were ignored — he presented an Employment Tribunal claim on 27 December 2022, naming the warehouse’s correct address on the ET1 and bringing complaints of direct race discrimination and race-related harassment.
Costco filed no response. The Tribunal sent four items of postal correspondence to the warehouse over the following year — including the claim, hearing notices, and a notice that no response had been received — all of which the Employment Tribunal found were received and ignored. Six further emails, including the case number and title in the subject line, were sent directly to the General Manager; the Tribunal found these were seen and deliberately deleted by her, rejecting her evidence that they must have gone to spam. Costco asserted it was unaware of the proceedings until 19 December 2023, when a record of a preliminary hearing reached its head office. A response was eventually submitted on 22 December 2023, ten months out of time, accompanied by an application to extend time.
Employment Judge S. Knight refused the application after a hearing in February 2024, finding that the explanation for the delay was untruthful, that the claimant had been prejudiced by a year’s delay, that no strong defence had been put forward, and that justice did not require granting the extension. Costco appealed to the Employment Appeal Tribunal.
The Court’s Holding
HHJ James Tayler dismissed the appeal, holding that the Employment Tribunal had not erred in law. Applying the leading authority of Kwik Save Stores Ltd v Swain [1997] ICR 49, the EAT confirmed that the discretion to extend time under Rule 20 of the Employment Tribunal Rules 2013 requires an overall balancing exercise across three factors: the explanation for the delay, the balance of prejudice, and the merits of the proposed defence. Crucially, the EAT rejected Costco’s argument that the Tribunal was required to determine as a binary threshold which party would suffer greater prejudice; the prejudice to each side can instead be weighed as components of the overall assessment without any mandatory interim finding.
The EAT upheld the Employment Tribunal’s reasoning in full: the delay of ten months was very substantial; the proffered explanation was not merely inadequate but actively untruthful, with the General Manager having deliberately deleted tribunal correspondence; the claimant suffered real prejudice from a year’s delay that costs orders could not remedy; and the defence, presented without supporting witness evidence on the substantive allegations, was not strong. Where such factors weigh heavily against an extension, the EAT confirmed that countervailing considerations must be correspondingly strong — and they were not here.
The EAT also used the appeal to clarify the proper approach to Kwik Save: it is not a statute or a checklist of hard rules; the three factors need not be addressed in any fixed order; a finding that an arguable defence exists is not itself a threshold requiring an extension to be granted; and a rejected explanation — even a false one — does not automatically foreclose an extension, though it may prove decisive. On the facts, the Employment Tribunal’s decision to refuse fell well within the permissible range of the discretion.
Key Takeaways
- A deliberate or dishonest explanation for delay in filing a response can be the decisive factor in refusing an extension of time, particularly where the delay is lengthy — here, ten months.
- Employment tribunals are not required to find as a binary matter which party faces greater prejudice; they may weigh the prejudice to each party as part of a holistic assessment.
- An arguable defence does not guarantee an extension of time: the tribunal may assess the apparent strength or weakness of the defence and, where other factors are strongly adverse, require the defence to be correspondingly compelling.
- Respondents who ignore tribunal correspondence — whether postal or by email — do so at their peril; the failure to have any system for routing legal proceedings to those responsible for responding provides no mitigation.
- Appeals against the exercise of this discretion face a high threshold: the EAT will not re-weigh the factors itself and will only intervene where the discretion was exercised contrary to established legal principles.
Why It Matters
This decision serves as a stark reminder to corporate respondents that the time limit for filing an ET3 response is a procedural requirement that must be met, not a default starting point for negotiation. Large employers with distributed operations are expected to have functioning internal processes for identifying and escalating employment tribunal proceedings; the absence of such processes, or their deliberate circumvention by a senior manager, will not excuse a lengthy delay. The case underscores that where a respondent’s own misconduct — including the destruction of evidence by deletion — has caused the default, the balance of justice will rarely favour granting relief.
More broadly, the EAT’s clarification of Kwik Save provides useful guidance on how tribunals should structure the balancing exercise: there is no mandatory sequence, no binary threshold on prejudice, and no automatic entitlement flowing from an arguable defence. The overall assessment must be conducted through the lens of the overriding objective, including the systemic impact that condoning delay has on other litigants awaiting hearings.