UK employment law is about to undergo a major face lift following an announcement by the Government on 23 November. The changes, hailed as the biggest shakeup of employment law for decades, are part of the Government's plans for growth, cutting unnecessary demands on businesses while safeguarding workers’ rights. Aimed at fundamentally improving the way employers take people on, manage disputes and let people go, the proposals include:
- consolidation of national minimum wage regulations;
- creation of a universally portable CRB check that can be viewed online instantly by employers from early 2013;
- reduction of the minimum consultation period for large scale collective redundancies from 90 days to 60,45 or 30 days;
- introducing compensated ‘no fault’ dismissal for small businesses with fewer than 10 employees;
- ‘slimming down’ and simplifying dismissal processes;
- introducing employment tribunal fees for employees to lodge a claim then a second fee to proceed to a hearing depending on the value of the claim;
- simplification of TUPE laws as they are currently perceived to be ‘gold-plated’ and overly bureaucratic;
- financial penalties to be introduced on employers who unreasonably breach employment rights through negligence or malice, payable to the Exchequer, subject to a discretion exercisable by employment judges. The penalty is likely to be half the amount of the total award subject to a £100 minimum and £5,000 maximum. The employment judge can ascribe a monetary value to a non-financial award;
- tribunals to be allowed to award costs of up to £20,000 against vexatious claimants;
- removal of protection for whistleblowing that relates to a worker’s own employment contract.
Following the conclusion of the Resolving Workplace Disputes consultation, which closed in April 2011, the Government has committed to:
- modernising maternity and paternity leave with emphasis on greater involvement for fathers;
- requiring all employment disputes to be offered Acas pre-claim conciliation before going to a tribunal;
- increasing the qualifying period for unfair dismissal to two years from April 2012;
- consulting in 2012 on ‘protected conversations’ to allow employers to have discussions with staff about retirement or poor performance, which could not be relied on in a tribunal claim with the exception of discrimination cases;
- changes to existing tribunal rules to include changes to costs and deposit orders;
- consulting on simplifying compromise agreements – renamed ‘settlement agreements’;
- developing a ‘rapid resolution’ scheme to enable simple claims to be settled within three months;
- modifying the formulae for redundancy payments to the nearest pound.
Julian Yew, employment partner in Penningtons' hotels and leisure group, commented: "Some of these proposed changes are very positive in that they will enable hoteliers and restaurateurs to exit their staff more easily and to manage any tribunal claims that arise. The new legal landscape will dramatically change how businesses handle their personnel and operational requirements."
Contact: Julian Yew
Related services: Employment, hotels and leisure