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Changes in employment law

This April has seen the government make a number of changes in employment law with further alterations due to come into force in October. Here are the changes which have been made in April.

  • Increase in statutory payment rates

For the next three years statutory payments, which rise every April, will be limited to just a one percent rise. Therefore, this year statutory sick pay has risen to £87.55 per week and statutory maternity, paternity and adoption pay has gone up to £138.18 per week.

  • Collective redundancy consultation

Collective redundancies are those situations where an employer is intending to make 20 or more redundancies in 90 days or less. Before April, if there were 100 or more employees involved, consultation would have been for a minimum of 90 days but this has now been cut to 45 days. The situation with fixed term contracts is different and employers do not have to consult with employees on these types of contract unless they are being made redundant before their fixed term contract ends.

  • Protection for people dismissed for political reasons

From April 2013 anybody dismissed for their political views will no longer require two years’ employment in order to bring an unfair dismissal claim. Such cases will be judged in the usual way and dismissals of this type will not automatically be seen as unfair. However, employers will have to take more care if they intend getting rid of an employee who they know holds political beliefs.

  • Equality Act amendments

Two amendments have been made to the Equality Act 2010. Firstly, the third party harassment provisions are to be repealed. This is where a worker has a claim against an employer if they are suffering harassment of some kind from a third party such as a customer or supplier, they have complained on at least three occasions and the employer has done nothing about it.

Secondly, the discrimination questionnaire procedure has been abolished, which was when an employee with a possible discrimination claim could send their employer the questions to establish whether or not they have a claim. However, employees will still be able to put questions to the employers and tribunals will still have the power to take responses into account.

  • Increase in parental leave

The amount of time that parents can take off work as unpaid parental leave has been expanded from 13 to 18 weeks due to the Parental Leave Directive being implemented in the UK. Parents can still take a maximum of four weeks leave per year.

  • Minimum wage

As of 1 October 2013, the following minimum wages have increased:

  1st October 2012 1st October 2013
21+ £6.19 £6.31
18-20 £4.98 £5.03
16-17 £3.68 £3.72
Apprentice £2.65 £2.68
  • Pensions auto-enrolment

This is a scheme which is aimed at making it easier for people to save for their retirement while at work. toDepending on the size of the business, business will now have to automatically enrol their workers into a qualifying workplace scheme if they are not already in one, starting on 1 October 2012 for business with 250+ employees and ending on 1 April 2017 for businesses with fewer than 30 employees.

Our team of specialist employment solicitors can advise you on the implications for you.

  • Last date for retirement under default retirement age

The effect of this change is to repeal the default retirement age of 65 and the implication for businesses is that retirement dismissals could possibly be ruled as discriminatory at any age. So, at the age of 65 or indeed any age, the firm concerned will have to demonstrate that there was a fair reason and objective justification for dismissing the employee. 

This will be the case whether or not the firm decides to keep a fixed retirement age or whether it opts to retire people on a case by case basis. Whatever the firm decides it will, from now on, have to justify its decision to retire an individual employee. If they can’t, the worker may well choose to bring discrimination and unfair dismissal claims against them.  

What other implications will the abolition of the DRA have?

It is likely to have an effect on workforce planning. Those companies which do not set a fixed retirement age will leave their workers unsure when they will be expected to retire. 

There will be no natural point at which the employer will expect to meet with a particular worker about their retirement. In fact bringing up such a discussion may be thought of as discriminatory.

It will therefore make it more difficult to look at future workforce requirements and could, in theory, make it harder for younger workers. If they do not know when they will be expected to retire it will make it harder for them to predict their career path. 

  • Introduction of tribunal fees

As of 29 July 2013 there are now fees to issue claims in the Employment tribunal.

The fees are dependent on the type of claims:

Type A Claims, i.e. unpaid wages; payment in lieu of notice; redundancy payments; and your employer refusing you time off to go to antenatal classes :

£160 issue fee (payable upon issue of a claim), and

£230 hearing fee (payable shortly before the hearing).

Type B Claims, i.e.  unfair dismissal; discrimination complaints; claims under the Public Information Disclosure Act (sometimes referred to as ‘whistleblowing’):

£250 issue fee

£950 hearing fee.

Depending on your circumstances, you may be entitled to apply for a remission of all or part of the fees. More information can be found here.

The tribunal have indicated that should you be successful in your claim, any award will be increased to reflect the fees paid.

TOP TIP - when looking at settlement, take the fees into account and request reimbursement of fees.

  • Settlement Agreements and Protected Conversations 

On 29 July 2013, compromise agreements were re-named settlement agreements and the concept of protected conversations was brought into force.

Using protected conversations, employers can conduct pre-termination negotiations to bring the employment relationship to an end by mutual agreement. 

Unlike without prejudice communications (which need to follow a dispute, i.e. a grievance or disciplinary action to be protected as “off the record” for the tribunal), protected conversations can take place and receive the above protection simply if the employer believes that “things just aren’t working out”. 

However, these conversations will not be protected if they concern issues relating to automatically unfair dismissal, discrimination or where the employer has acted improperly. 

In order to act properly, employers are advised to give 10 calendar days notice of any proposed settlement offer and to allow the employees to have either a trade union representative or colleague present. Examples of improper conduct are: harassment, bullying, violence (or threat thereof), discrimination or undue pressure.

  • Increase to Tribunal awards
Type of payment 1st February 2013 1st February 2014
Maximum basic award/redundancy payment £13,500 £13,920
Maximum compensatory award £74,200 £76,574
Maximum week’s pay £450 £464
Statutory sick pay (weekly) £86.70 £87.55
Statutory Maternity Pay (1st 6 weeks) 90% of average weekly earnings 90% of average weekly earnings
Statutory Maternity Pay (remaining weeks) The lesser of either 90% average weekly earnings or £136.78 The lesser of either 90% average weekly earnings or £138.18
  • Early Conciliation

On 6 May 2014 pre-claim conciliation becomes mandatory. Under claimants will have to submit details of their dispute to ACAS before bringing a claim at which point they will be offered pre-claim early conciliation for a period of one month. If pre-claim conciliation is unsuccessful, the conciliator officer assigned to the matter will issue a certificate to that effect. The Claimant requires that certificate in order to commence a claim at an employment tribunal.