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Reforms to the Employment Law System

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The Government has announced its proposals for reform of the employment law system following its consultation, ‘Resolving Workplace Disputes’, and the Red Tape Challenge review of employment law.

The aim is to replace overburdensome regulation whilst safeguarding workers’ rights, with a focus on settling disputes without resort to an Employment Tribunal (ET).

The proposals arising from the Resolving Workplace Disputes consultation include:

  • requiring all employment disputes to go to the Advisory, Conciliation and Arbitration Service for pre-claim conciliation before going to an ET;
  • increasing the qualification period for unfair dismissal from one to two years. This is scheduled to take effect from April 2012;
  • publishing a consultation on ‘protected conversations’, which would allow employers to discuss issues like retirement or poor performance in an open manner with staff without anything said being used in any subsequent ET claims;
  • appointing Mr Justice Underhill to lead an independent review of the existing rules of procedure governing ETs. This will seek to address concerns that they have become increasingly complex and inefficient over time and are no longer fit for purpose;
  • a consultation on the introduction of fees for anyone wishing to bring an ET claim. The consulation ends on 6 March 2012;
  • giving Employment Judges discretionary powers to impose financial penalties on employers found guilty of breaching employment law whose behaviour in so doing had aggravating features;
  • a further consultation on measures to simplify compromise agreements, which will be renamed ‘settlement agreements’; and
  • consideration as to how and whether to introduce a ‘rapid resolution’ scheme, to offer a quicker and cheaper alternative to determination at an ET. Any proposals would then be the subject of a consultation.

The Government’s full response can be found on the Department for Business, Innovation and Skills’ website.

In response to the Red Tape Challenge, the Government has recently sought views on:

  • the consultation rules for collective redundancies and whether the current 90-day minimum consultation period where more than 100 redundancies are contemplated can be reduced. The consulation document can be found here. Consultation closed on 31 January 2012;
  • ways to simplify the Transfer of Undertakings (Protection of Employment) Regulations 2006, which many businesses say are too complex and bureaucratic. The consultation document can be found here. Consultation closed on 31 January 2012.

In addition, the Government plans to merge 17 National Minimum Wage regulations into one set in order to simplify the current regime and to introduce a universally portable Criminal Records Bureau check that can be viewed by employers instantly online.