Employment law reform
The Government's formal response to the consultation on Resolving Workplace Disputes was published at the end of November 2011. The proposed reforms place an increased emphasis on freeing up tribunal resources, deterring unwarranted claims and early resolution of workplace disputes. There are also anticipated changes, some subject to further consultation, which will bring about significant reform to employment issues in the workplace.
Changes already in effect
From April this year, the following changes have taken place:
- The qualifying period of service required before an employee can bring an unfair dismissal claim increased from one to two years. This applies to all employees who commenced employment on or after 6 April 2012.
- To save time during a tribunal hearing, where witness statements are used they will stand as evidence in chief and be taken as read at the hearing, unless an employment judge or tribunal directs otherwise.
- Where employment tribunal judges (ETJ) consider that a party's case has little reasonable prospect of success they can order a party to pay a deposit of up to £1000 as a condition of continuing with the proceedings.
- The general position in employment tribunal proceedings is that each party bear its own legal costs. However, in limited circumstances, an ETJ has discretion to order a party to make a payment of up to £20,000 in respect of the other party's costs.
- Prior to April, unfair dismissal claims were heard by an ETJ and two lay wing members, one of whom would have a trade union background and one a more corporate background. Now, unfair dismissal claims will normally be heard by an ETJ sitting alone.
These changes relate to cases presented on or after 6 April and should help to deter or weed out weaker cases.
Increased payment thresholds
Statutory Maternity Pay has been increased to £135.445 a week; Statutory Sick Pay to £85.85 a week; and the weekly earnings threshold has risen to £107.
Further proposals and ongoing consultation
The Government proposes to introduce a pre-claim conciliation period designed to encourage resolution of disputes as soon as possible and before a claim is formally submitted to a tribunal. Claimants will submit their simplified claim form to ACAS and both parties will then be offered the option of a one-month conciliation period. This will not be compulsory and will have a knock on effect on the timeframes within which individuals can submit claims, effectively pausing the clock during any attempt at pre-claim conciliation.
A system of "protected conversations" has been proposed to allow employers or employees to initiate a conversation about an employment issue at any time "as a way of resolving the matter without fear". The idea is to allow employers to have a frank discussion with employees about poor performance or retirement plans. However, this proposal is fraught with practical difficulties, and could well lead to disputes around whether there was or was not a protected conversation. Although not dealt with explicitly, it is understood that an employer would not be protected from claims of discrimination or harassment in relation to these conversations. This raises the question as to how an employer could approach discussions about retirement which would be inherently age discriminatory, without exposing itself to a potential claim.
The Government intends to introduce financial penalties for employers who lose claims at tribunal. Tribunal judges will be given a discretion to consider imposing penalties where the employer's behaviour in breaching employment legislation has aggravating features. The maximum penalty will be £5,000 reduced by 50% if paid within 21 days.
No-fault compensated dismissals and the ACAS Code
Smaller dental practices may welcome news that there are proposals to introduce compensated no-fault dismissals for micro-employers (ie those with less than 10 employees). Under present rules, any dismissed employee with the required service may bring a claim for unfair dismissal and require the employer to show that it had one of the five designated reasons for dismissal, followed a fair process, and acted reasonably in dismissing the employee in the circumstances. Compensated no-fault dismissals would give micro-employers (ie small practices) - the option of bypassing these rules and making a prescribed payout to the employee. However, claims could still be brought under other jurisdictions, such as discrimination claims.
In addition, the Government will be looking at "radically slimming down...existing dismissal processes" by seeking views on how to move to a simpler, quicker and clearer dismissal process, including potentially working with ACAS to make changes to its Code to make it easier to use for smaller businesses.
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