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Could a tribunal claimant freeze their employer’s bank account?

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The Scottish courts have held that they can make protective orders against the assets of an employer where a claim is brought against that employer in the employment tribunal.

In Anwar v Advocate General, Ms Anwar had won an award of £75,000 in the employment tribunal against her former employer for harassment on the basis of her sex, race and religion. However, two months after the award was made, and before any payment was received, the credit of the employer’s bank account had fallen to just £4,000, meaning that she was unlikely to receive any significant payment from the employer.

Ms Anwar argued that, in order to avoid this situation occurring, she ought to have been able to obtain an order for arrestment on the dependence of her claim at the time she raised it.  That is an order allowing her to arrest or temporarily “freeze” some of her employer’s assets, such as a bank account.  If her claim was successful she would be able to seek payment from the arrested assets. Since employment judges do not have this power, she said that the UK was in breach of EU law.

The Outer House of the Court of Session held that Scots law did allow such orders to be made in respect of employment tribunal claims.  However in order to get the order the claimant would have to make an application to the sheriff court in conjunction with their claim in the tribunal. The Court held that this system did not contravene EU law.

On appeal, the Inner House upheld this decision. It said case law established that a protective action could be raised in a sheriff court even though that court had no jurisdiction to hear the merits of the tribunal claim. EU law did not require any particular form of procedure to be available, and the additional action in the sheriff court was not excessively difficult.

In the majority of tribunal claims, it is unlikely that claimants will view seeking such orders on the dependence as necessary – or, even if they do, would be able to persuade the court it was appropriate to grant them. However, there may be some cases where claimants can argue that it is reasonable to freeze an employer’s assets, for example where class actions are presented on behalf of a large number of claimants, or where the employee is aware of their employer or ex-employer’s financial difficulties. As the procedure for these protective measures is relatively straightforward and inexpensive, employers should be aware that, following the Anwar decision, employees may consider raising a parallel action in the sheriff court when raising an employment claim.