The government has this morning issued its response to the recent consultation, ‘Ending the Employment Relationship’. It has also today launched two new consultations which will be relevant to our members relating to the TUPE Regulations and Early Conciliation...
Several pieces of information contained in the government’s press release today are likely to attract publicity – not least its plans to introduce a maximum 12 months’ pay for the compensatory award for unfair dismissal (still capped at the current limit, if 12 months' pay is greater) and to abolish the ‘service provision change provisions’ under TUPE.
The government issued several consultations relating to employment law back in Autumn 2012, including the ‘Ending the Employment Relationship’ consultation which we wrote about at the time - see Government announces proposals for changes to employment law and More flesh added to the bones of the government’s proposals for employment law reforms. The Government has today issued its response to that consultation.
The government has also launched two new consultations of interest to our members today relating to: the TUPE Regulations; and Early Conciliation.
We summarise the key changes here, but we will be producing a more detailed HR Briefing once we have had a chance to digest the papers.
Unfair dismissal – cap on the compensatory award
One of the proposed changes likely to grab the headlines today relates to the compensatory award for unfair dismissal - the government indicates that it will introduce a cap of 12 months’ pay for the compensatory award. For those for whom 12 months' pay would exceed the current cap of £72,300 (due to rise to £74,200 next month), that financial limit will remain.
In practice, we envisage that this will mean that the maximum compensatory award for an employee who earns £25,000 per annum will be £25,000 rather than the current potential compensatory award of £72,300. The maximum compensatory award available to an employee who earns £95,000 will, however, remain at £72,300. This change is good news for employers, though less significant when terminating the employment of their highest earners.
Ending the Employment Relationship
The government has demonstrated that it remains committed to making it easier to initiate settlement discussions and has clarified that ACAS will produce a statutory Code of Practice which will include template letters for beginning settlement discussions with employees and template settlement agreements. It also intends for accompanying guidance to be produced to help employers who wish to approach settlement with their employees.
The government has also issued a new consultation relating to the TUPE Regulations today. The most striking proposal is to repeal the provisions relating to so-called ‘service provision changes’. In addition, the government is consulting on: changes to the provision of employee liability information; changes on TUPE-related unfair dismissal rules; and changes to information and consultation rules in TUPE scenarios to clarify when employees can consult directly with employees rather than with appointed employee representatives. This consultation will close on 11 April 2013.
The government is consulting further on the process that ACAS will use to facilitate early conciliation, whereby most prospective claimants would be required to send the details of their claim to ACAS before being able to lodge a claim with the employment tribunal.
Watch this space!
As well as producing a more detailed HR Briefing on this topic in due course, we will also be looking at these employment law developments in our forthcoming member briefings, which are free for EEF members.
For more information and to book your place click here.