An interesting opinion on the Enterprise and Regulatory Reform Act 2010 (“the Act”) reported in The Lawyer, in that, ‘…the government has listened to business concerns that the weighting in tribunal claims is too strongly in favour of employees.’
While I agree that this is the case, how the Enterprise and Regulatory Reform Act 2010 will actually help businesses in practice remains to be seen.
Referring claims to ACAS for a month consultation may result in more claims being settled before they reach the Employment Tribunal.
Giving employers the option of settling claims before they have incurred significant legal fees in responding to claims, especially if the claims are misconceived or vexatious, can only be a positive step.
In addition, if the Employment Tribunal believes that the employers have breached workers’ rights they will have the power to order them to pay a penalty of between £100 and £5,000 where the breach amounts to “aggravating features”. This penalty is payable to the government. Aggravating features appears to be subjective in the sense that Employment Tribunals will take into account the size of the business etc.
We have witnessed a number of claims whereby the employee has issued a claim without the relevant qualifying service on the basis that they are protected ‘whistle-blowers’. The changes will ensure that the disclosure must be ‘in the public interest’. ‘Public interest’ is not defined in the Act which may in itself result in more litigation.
The most awaited change will be introduced in the summer. Employers will have the ability to have protected ‘settlement discussions’ with employees who are not working out or are under-performing. Again, how these discussions will take place and how they will be excluded from any unfair dismissal claims will be interesting.
The introduction of the new cap on compensation for unfair dismissal to no more than one year’s pay will provide a ceiling for employers. Settlement figures will continue as normal, this may make it easier for employers and employees to negotiate a settlement.
I believe that overall businesses will benefits from the proposals. No doubt, the repeals of the discrimination questionnaires and third party harassment will also be welcomed by businesses. All in all, this is a breath of fresh air for employers and possibly the start of more sensible legislation.
For the full article in The Lawyer: http://www.thelawyer.com/law-firms/hogan-lovells-partners-comment-on-the-enterprise-and-regulatory-reform-bill/3004264.article.
By Laura Allanson. Laura is Head of Employment at BHW Solicitors in Leicester and regularly writes on employment matters. Laura can be contacted on 0116 281 6237 or at firstname.lastname@example.org