In a recent meeting of the BPP Legal Awareness Society, we discussed forthcoming developments in English law to do with employment and pensions.
This description does not constitute legal advice, and the information presented here is to the best of the knowledge of the Legal Awareness Society, as presented at BPP Law School, Holborn, 26 January, 5 pm, room 2.4
1. Qualifying period for unfair dismissal protection is increased
The Government sought to “radically slimming down” the existing dismissal processes, and seek views on how to achieve this, including, potentially, by making changes to the “Acas code of practice on disciplinary and grievance procedures”.
On 3 October 2011, the Government announced that the qualifying period for an employee to bring an unfair dismissal claim will increase from one year to two years. This change will come into force on 6 April 2012.
The increase was originally proposed in the Government’s Resolving workplace disputes: public consultation (on the BIS website), which states that the increase will: “provide more time for employers and employees to resolve difficulties, give employers greater confidence in taking on people and ease the burden on the employment tribunal process”. (This document is appended to this handout.)
In January 2012, the Government confirmed that the increase will apply only to employees who join an employer on or after 6 April 2012. The current one-year qualifying period will continue to apply to employees who started their employment prior to 6 April 2012.
Compulsory retirement dismissals instigated on or after 6 April 2011 may amount to unfair dismissal under the Employment Rights Act 1996 and direct age discrimination under the Equality Act 2010. The Employment Equality (Repeal of Retirement Age Provisions) Regulations 2011 (SI 2011/1069), which came into force on 6 April 2011, removed retirement from s.98 of the Employment Rights Act 1996 as a potentially fair reason for dismissal. Retirement dismissals are likely to be considered as “some other substantial reason” dismissals and must be effected using a fair procedure.
2. Changes to employment tribunal procedure
The Government has asked the outgoing President of the Employment Appeals Tribunal, Mr Justice Underhill, to carry out a “fundamental review” of the Employment Tribunal Rules of Procedure, with the intention of producing a streamlined procedural code that addresses concerns that the Rules have become “increasingly complex and unwieldy over time”. Underhill is to provide a recommended revised procedural code by the end of April 2012.
There is going to be a “fundamental review” of the Employment Tribunal Rules of Procedure, with substantial changes to employment tribunal procedure expected to be introduced on 6 April 2012. Employment judges will hear unfair dismissal cases alone in the tribunal, unless they direct otherwise.
3. Pensions auto-enrolment begins
The state pension system currently combines a contributory state scheme, consisting of a basic retirement pension and an additional pension (previously the State Earnings Related Pension Scheme, now the state second pension (S2P)), with a private system of occupational and personal pensions. The state pension age for men is 65. It is in the process of increasing from 60 to 65, for women. It will have reached 65 by 6 November 2018. It is due to increase to 66 for men and women by October 2020.
In what may prove to be one of the biggest challenges of the year for larger employers, starting from 1 October 2012, employers with 50 or more employees have to enrol eligible employees automatically, and make mandatory employer contributions, into a qualifying workplace pension scheme or the National Employment Savings Trust (Nest).
4. Statutory redundancy payments and guarantee payments increase
The maximum amount of a week’s pay used to calculate a statutory redundancy payment and the basic and additional awards for unfair dismissal increases from £400 to £430 on 1 February 2012. The maximum unfair dismissal compensatory award increases from £68,400 to £72,300. The limit on the amount of a guarantee payment payable to an employee in respect of any day also increases from £22.20 to £23.50.
5. Maternity, paternity, adoption and sick pay increase
Vince Cable has re-affirmed the Government’s commitment to extend the right to request flexible working, and to “modernise” maternity leave so that it becomes “shared and flexible parental leave”. The Government has confirmed that the standard rate of statutory maternity, paternity and adoption pay will increase from £128.73 to £135.45 per week from 1 April 2012. Statutory sick pay will increase from £81.60 to £85.85 per week from 6 April 2012.
6. Some various other moves afoot
Compromise agreements
The Government will create a “standard text” for compromise agreements, with guidance. It will consider amending the Employment Rights Act 1996 to allow compromise agreements to cover all existing and future claims without the need to list many separate causes of action. The Government will change the name of compromise agreements to “settlement agreements” in primary legislation.
Mediation
The Government is, following the consultation, “even more convinced” about the role that mediation can play. It intends to introduce a requirement for all potential tribunal claims to be lodged with ACAS, to give the parties a chance to resolve the matter through early conciliation. The basic early conciliation period will be one month. Where early conciliation is refused or is unsuccessful the claimant will be allowed to lodge his or her claim with the tribunal. The Government will also pilot the creation of regional mediation networks.
Financial penalties The Government intends to introduce a discretionary power for employment tribunals to impose a financial penalty on employers that have been found to have breached employment rights, payable to the Exchequer. The financial penalty will be based on the total amount of the tribunal award, with a minimum threshold of £100 and a maximum of £5,000. A penalty will be reduced by 50% if payment is made within 21 days.
TUPE
The Government has launched a call for evidence on the effectiveness of the TUPE regulations and how they might be improved. The Government is “concerned” that some businesses believe the TUPE regulations are “gold-plated” and overly bureaucratic. The call for evidence is open from 23 November 2011 to 31 January 2012.
Collective redundancies
The Government has launched a call for evidence regarding the rules governing statutory consultations on collective redundancies. In particular, it wishes to “explore the consequences” of reducing the current 90-day consultation period to 60, 45 or 30 days. The call for evidence is open from 23 November 2011 to 31 January 2012.
Criminal Records Bureau checks
From 2013, once a CRB check has been completed, the results will be available online for employers to confirm that no new information has been added since the check was originally conducted. This will mean that CRB checks are portable, and that an employee will not have to have a new check every time he or she starts a new job.
