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Employment law reforms unveiled

Posted by on in Dismissal

The Government has published details of proposed employment law reforms relating to termination of employment and employment tribunals.

The proposals include:

  • the use of settlement agreements to help end employment relationships in a fair and consensual way. A consultation on how best to make this work in practice has already begun, and Acas has agreed to provide a new code of practice,
  • how it might reduce the cap on compensation for unfair dismissal claims,
  • proposals to streamline employment tribunals by making it easier for judges to dismiss weak cases,
  • responses to its call for evidence on the TUPE rules, when staff transfer to a new employer. Government has heard that businesses want this to be more efficient, and will consult on specific proposals before the end of the year, and
  • recommendations on how to improve guidance for small businesses on the Acas code of practice on discipline and grievance.

The Government also responded formally to the call for evidence on proposals for compensated no fault dismissal for micro-firms. Based on the evidence presented by business the Government will not be taking forward the proposal.

The Government is already delivering significant reforms of employment law, including extending the period for eligibility for unfair dismissal from one to two years, encouraging more effective ways to resolve disputes and thereby reduce the number of employment tribunals, creating a universally portable Criminal Records Bureau (CRB) check and removing the default retirement age. The Government has considered, or is already taking forward, 80% of proposals from Adrian Beecroft’s report on employment law, published earlier this year.

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.”

Call for Evidence on dismissal

Posted by on in Dismissal

Proposals to examine the current dismissal process have been announced by the Government with the publication of a Call for Evidence.

Through the Call for Evidence, the Government is seeking to establish a strong evidence base on the current understanding of the dismissal process, including awareness, understanding and use of the Acas Code of Practice on Discipline and Grievance. The Government will be seeking the views of employees, business organisations and all other interested parties.

The Government has also published the Employment Law Review annual update in the Houses of Parliament, outlining how the review has been taken forward. The report summarises the current programme and looks ahead to further areas it is considering as part of the Review.

In addition, it was also announced that the Employer’s Charter, first published in January 2011, has been updated to include pointers on sickness absence and recruitment. The Charter aims to counter the misconception that employment protections are all one-way - towards the employee. It will give greater clarity to managers on what they can already do to deal with issues in the workplaces, on subjects such as performance, sick leave, maternity leave, requests for flexible working and redundancy.

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