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Unreasonable Employment Lawyer Costs

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Employers beware of high employment lawyer fees when defending a personal grievance claim.

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Seeking indemnity costs

The seeking of indemnity costs is where a party seeks the full amount of costs that they have incurred. This is generally not available in New Zealand’s courts unless the unsuccessful party has behaved either badly or very unreasonably during the course of the proceedings. This could include where there has been delaying tactics, timetabling breaches, or conduct that results in a party’s preparation being unnecessarily duplicated. A clearly hopeless case could possibly meet the threshold for indemnity costs. Late withdrawal certainly is not a ground for indemnity costs.

The Employment Relations Authority’s practice note on costs comprehends that costs are dealt with in a way the Authority thinks reasonable. Contribution towards costs will be modest and not intended to punish. In doing so it uses a notional daily tariff as a starting point, $4,500 for the first day of an investigation meeting, and $3,500 for subsequent days. The daily tariff is adjusted upward or downward when taking into consideration party conduct that may have caused increase in costs, or where reasonable offers to settle are rejected and not beaten.

These principles that apply to costs in the Authority should be well known to representatives. This knowledge should be shared with the client during the process and should be used effectively so that the employer defending a claim can make informed decisions regarding settlement.

Trouble recovering ERA costs from employee

JAMISON v PETS IN THE CITY MT WELLINGTON LIMITED [2022] NZERA 203

Through its advocates, Pets In The City sought against former employee Cassandra Jamison an award of indemnity costs, or alternatively a substantial uplift. The total amount sought was $41,454.42. The parties had not attended an investigation meeting; they were at the final stages of exchanging witness statements and documents.

The employer was only able to recover $2,000 from the employee, Ms Jamison.

Jamison v Pets in the city my wellington limited [2022] NZERA 203 Download File: Jamison v Pets in the city my wellington limited [2022] NZERA 203

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Unreasonable employment lawyer costs Download File: Unreasonable employment lawyer costs

Leighton Associates website: Employers beware, a costs nightmare - by Lawrence Anderson

Last Updated: May 27, 2022 0800 WIN KIWI