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Subscribe to this list via RSS Blog posts tagged in No-Fault Dismissal

Ahead of its submission to the government’s call for evidence on compensated no-fault dismissal, Britain’s manufacturers have called on the government to refocus its efforts on the areas of employment reform that will deliver genuine benefit for business.

In its submission EEF, the manufacturers’ organisation, has indicated that the concept of compensated no-fault dismissal commands little support from Industry, that its benefits would be limited and that it would make little or no difference to recruitment plans.

Furthermore, EEF is concerned that the controversy over this is diverting attention from many of the other proposals which command much greater support from business and, where government needs to move faster. To address this EEF issued a five point plan for employment reform:

1. Accelerating plans to reduce the 90 day consultation period for collective redundancy 30 days.

2. Delivering on commitments to reduce the number and length of Employment Tribunals by streamlining the process, making greater use of conciliation and requiring claimants to lodge fees ahead of making a claim.

3. Simplifying TUPE regulations to allow employers to harmonise terms and conditions of employees a year after the transfer of the business has taken place.

4. Helping employers to manage performance by introducing protected conversations which give employers a safe space to discuss performance issues with employees without triggering legal action and making it simpler to reach compromise agreements if the employment relationship has come to an end.

5. Clarifying its plans for shared parental leave and ensuring that any such system is kept simple to operate.

Government plans to enable micro firms to dismiss employees without good reason risks creating a perverse barrier to economic growth by discouraging small businesses from hiring more workers.

This is the view of the Chartered Institute of Personnel and Development (CIPD) in response to the call for evidence by the Department for Business, Innovation and Skills on proposals to introduce compensated no fault dismissals for firms with fewer than ten employees.

Under a system of compensated no-fault dismissals, businesses with fewer than ten employees (known as micro businesses) would be able to dismiss a worker, where no fault had been identified on the part of the employee, with the payment of a set amount of compensation.

Mike Emmott, employee relations public policy adviser at the CIPD, said:

“There is no economic case to be made for the watering down of employment rights for businesses of any size. Businesses have far more to lose in lost productivity from a de-motivated and disengaged workforce than they stand to gain from the ability to hire and fire at will. The consequences for the UK’s economic growth could prove particularly perverse when it comes to micro-businesses, who may be discouraged from hiring their tenth worker and may even struggle to recruit high calibre employees because they are seen as low-road employers.”

The British Chambers of Commerce (BCC) has called for the government to do more to lift the burden of regulation on business.

Responding to the publication of the government’s Statement of New Regulation, John Longworth, Director General of the BCC, said:

“Although the costs faced by businesses have been reduced, the government has not gone far enough in terms of real deregulation in key areas such as employment. There is still a long way to go if ministers are to honour their pledge to be the first administration to leave office having significantly reduced regulation.

“Businesses tell us they are still not feeling the burden of regulation lifting. Although doubling the unfair dismissal qualifying period to two years will boost business confidence to hire, more changes are needed to create a hard-hitting and comprehensive deregulatory package.

“This includes reforming redundancy rules, introducing no-fault dismissal and tribunal fees and sufficient action to implement promised health and safety changes. Reforms to mitigate the effect of the removal of the Default Retirement Age must also be put in place. With unemployment so high, it is crucial that these changes are implemented without delay to give businesses confidence to invest and grow.

“The regulatory process must be made more robust and transparent, with the volume of proposals deemed out of scope through the One-in, One-out System reduced. Furthermore, the recommendations made by the Regulatory Policy Committee should be published so the government can be held to account for their promises. This will also help to prevent any single minister or department from creating burdensome and costly new red tape.”

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