Employment Law Changes Now In Effect

On Monday the 29 July 2013 a number of employment law reforms came into effect.

The main reforms incorporate changes to the following areas: the inadmissibility of pre-termination discussions, settlement agreements, fees in the Employment Tribunal and Employment Appeal Tribunal, new Employment Tribunal Rules of Procedure and a cap on compensatory awards.

Inadmissibility of pre-termination discussions

Parties will be able to engage in pre-termination discussions without fear of such discussions being used as evidence in tribunals.

Any party seeking to use pre-termination discussions between employer and employee as evidence during the ordinary course of an unfair dismissal claim will find them deemed to be inadmissible unless there has been improper behaviour during those discussions.

Employers should still tread cautiously.

Settlement Agreements

Agreements between employer and employee formerly known as ‘Compromise Agreements’ have now been renamed ‘Settlement Agreements’; any agreement executed must bare the new name to comply with the law.

Along with a new name, settlement agreements will be accompanied by new rules in relation to pre-termination negotiations.

Fees in the Employment Tribunal and Employment Appeal Tribunal

Employee claimants who issue a claim in the tribunal against their employers will be responsible for paying a fee. The fees will apply when a claim is presented and following notification that the claim has been listed for hearing.

There are currently two levels of claim (type A and B) and the fee will be set based on the complexity of the case. Type A includes for example claims of unlawful deduction from payments while Type B includes any unfair dismissal or discrimination claims.

Respondents will also be required to pay a fee in certain situations such as application-specific fees; for example, for reconsideration of a default judgment and counterclaims.

The introduction of fees is currently undergoing judicial review and their true application will be subject to the outcome of those proceedings.

New Employment Tribunal Rules and Procedures

The changes to the Employment Tribunal Rules and Procedures currently include:

1. The merger of pre-hearing reviews and case management discussions into a preliminary hearing.
2. Judges have been given the power to strike out weak cases.
3. A new requirement has been introduced whereby tribunals are responsible for encouraging parties to use alternative dispute resolution (ADR).

The current outstanding rules and procedures in Schedule 1 to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 (SI 2004/1861) are replaced in their entirety by Schedule 1 to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 (SI 2013/1237).

Reduced cap on compensatory awards

A new cap limiting individual compensatory awards has been introduced. The cap will be based upon the lower of gross pay equalling twelve months salary or the statutory cap that is currently £74,200.

If you would like more information regarding these employment law changes or advice regarding employment matters, Rollingsons has experienced lawyers who can advise you. Please contact Aneil Balgobin via e-mail ABalgobin@rollingsons.co.uk or by telephone on 0207 611 4848.