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Government announces further proposals for changes to employment law
Last week the Government made an announcement about its proposals following on from the Beecroft Report and other discussions regarding options to change certain aspects of employment law as reported earlier in the year. In particular:


• Proposals for the controversial ‘no fault dismissal’ have been abandoned. This has been intended to prevent employees working for small businesses from bringing an unfair dismissal claim in respect of their dismissals where employers provided monetary compensation.

• A consultation has now been launched on the possibility of ending employment relationships through the use of “settlement agreements” to replace “compromise agreements.” The consultation includes draft letters which employers could send to their employees with offers of termination and includes materials to help draft settlement agreements. ACAS has been asked to provide a new Code of Practice for settlement agreements.

• The consultation also seeks views on reducing the cap on the compensatory award for unfair dismissal (which currently stands at £72,300). It also asks for views on the proposed options for calculating the cap - the proposals are a cap of up to 12 months’ pay, a new, reduced upper limit and a limit linked to the size of the employer.

• The Government is also consulting on how to streamline employment tribunals even further and it is still expected that the new rules will come into force next April, with an emphasis on the more effective removal of weak claims at an earlier stage to reduce the number of hearings.

However, nothing has changed yet – there will still be a period of discussion before any of these changes are likely to come into effect!
Posted on 19 Nov 2016


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