The recent EAT decision in Costco Wholesale UK Ltd v Nash is a timely reminder of just how seriously Employment Tribunals take the deadline to respond to a claim. While tribunals will often apply some leniency where genuine reasons for missing a deadline exist, there is a clear limit to that flexibility. 

In this case, Costco attempted to submit its defence around ten months late. Its application to extend time was refused by the Tribunal, and the EAT confirmed that decision on appeal. The result was that the employer was largely prevented from defending serious allegations of race discrimination. 

A failure to engage with the claim

What makes this decision particularly striking is the Tribunal’s assessment of the underlying facts. This was not a case of administrative oversight or minor delay. The Tribunal found that multiple pieces of correspondence sent by the Tribunal had been received at the employer’s site but were simply ignored. 

Emails from both the Tribunal and the claimant’s solicitors were sent directly to a senior manager, and those emails were found to have been received and actively deleted rather than missed or diverted. The Tribunal rejected the employer’s explanation entirely and concluded that it had effectively been notified of the claim on numerous occasions but had chosen not to act.

A growing risk for employers

This decision lands at a time when we are seeing a continued increase in Employment Tribunal claims. As volumes rise across the system and new and expanded rights for workers are introduced under the Employment Rights Act 2025, the likelihood of any employer receiving a claim is increasing. For many organisations, particularly those with large or dispersed workforces, Tribunal litigation is no longer an occasional issue but an operational risk that needs to be actively managed.

Against that backdrop, the lessons from this case are particularly relevant. Tribunals will be keen to know about what systems an employer has in place to identify, escalate and respond to a claim within the time limits.

When will a Tribunal allow a late response?

The Tribunal has a broad discretion when deciding whether to accept a response out of time. 

A key factor is the explanation for the delay. The Tribunal will expect a full, honest and credible explanation, and the longer the delay, the more scrutiny that explanation will attract. In Costco, the explanation was not simply weak; it was found to be untrue, which significantly undermined the application.

The Tribunal will also consider the prejudice to both parties. Refusing an extension will almost always prejudice the employer because it may be unable to defend the claim. However, that is not decisive. The Tribunal is entitled to consider whether that prejudice has been caused by the employer’s own conduct, as well as the prejudice to the claimant caused by delay, particularly where proceedings have been stalled for a significant period.

The merits of the defence are another relevant factor. A Tribunal will usually consider whether there is some arguable defence, but that alone will not secure an extension. The strength and detail of the response matter. In this case, the Tribunal considered the employer’s defence to be lacking in detail and not particularly strong, which meant it carried limited weight in the overall assessment.

Ultimately, the Tribunal will stand back and ask what justice requires, taking into account all of these factors together.

Why the employer lost

The refusal to extend time in Costco was driven by a combination of factors. The delay was substantial, at around ten months, and there was no credible explanation for it. The Tribunal found that correspondence had been repeatedly ignored, and that the explanation given by the employer was not truthful. 

There was clear prejudice to the claimant, who had experienced significant delay in progressing the claim, and the Tribunal was concerned about the wider impact of delay on the administration of justice. While the employer would plainly suffer prejudice by being unable to defend the claim, that was considered to be a consequence of its own inaction. 

Taken together, those factors meant the Tribunal was entitled to conclude that it was not in the interests of justice to grant an extension.

Practical lessons for employers

Employers should look carefully at how Tribunal correspondence is handled in practice. It is important to have a centralised and reliable process for dealing with incoming post. Tribunal documents often arrive without a named individual and may be addressed simply to the business. There needs to be a clear system under which all such posts are opened promptly, scanned where appropriate, and logged in a way that ensures it is visible and traceable. 

The same principle applies to email communications. In Costco, emails from both the Tribunal and the claimant’s solicitors were received but ultimately deleted by a senior manager. This highlights the danger of relying on individual inboxes as the primary route for legal correspondence. Employers should consider using shared HR or legal inboxes for anything relating to claims, together with rules that flag or automatically forward messages from the Tribunal or known legal representatives. 

Clear and well-communicated escalation protocols are equally important. Managers at all levels should understand that any document or email relating to a legal claim must be treated as urgent and passed on immediately. That message needs to be reinforced through training and internal policies. A well-designed system should make it difficult for a claim to “sit” without someone being actively responsible for it.

Another key area is deadline management. The time limit for filing a response is short, and it runs from the date the claim is posted out by the tribunal. Early engagement with legal advisers is critical. Even where the employer is unsure how to respond, taking advice early allows time to assess the claim, prepare a response and, where necessary, seek an extension before the deadline expires. Tribunals are generally far more receptive to applications made in advance than those made many months after the event.

Finally, employers should not overlook the importance of internal accountability and review. Where a claim is missed, there should be a process for understanding how that happened and what needs to change. That may involve revisiting internal processes, providing further training, or clarifying lines of responsibility. As Costco demonstrates, a Tribunal is unlikely to be sympathetic where failures appear systemic or where opportunities to act have repeatedly been ignored. 

Final thought

The EAT’s decision reinforces a simple but important point. Time limits in the Employment Tribunal are not optional, and they are not treated lightly. 

As claim volumes continue to rise, the risk of receiving a Tribunal claim is only increasing. The question for employers is not whether it might happen, but whether they are equipped to respond quickly when it does.