Employment Law Key Legislative Developments

Transcription

1 Employment Law Key Legislative Developments (Updated: May 2013) A summary of the key legislative changes in employment law that were introduced in the past 12 months and the developments which are expected to be implemented in the coming 12 months APRIL Tribunal Procedure Changes A number of tribunal procedure changes were made, including: The maximum deposit order was increased from 500 to 1,000; the maximum amount of a costs order was increased from 10,000 to 20,000; witness statements (where used) are now to be taken as read, unless the tribunal directs otherwise; employment judges now sit alone when hearing unfair dismissal cases unless directed otherwise and state funding of witness expenses has been withdrawn. Unfair Dismissal Qualifying Period Increased The unfair dismissal qualifying period was increased from one to two years for those whose employment begins on or after 6 April Prescribed form of 'Apprenticeship Agreement' The Apprenticeship (Form of Apprenticeship Agreement) Regulations 2012 came into force, which prescribe the form of apprenticeship agreement to be used under the Apprenticeship, skills, Children and Learning Act OCTOBER National Minimum Wage Rates Increased As of 1 October 2012, the rate of the National Minimum Wage (NMW) is as follows: 6.08 to 6.19 per hour for those aged 21 and over; The rate for those aged years old to remain at 4.98 per hour; The rate for those aged years old to remain at 3.68 per hour; and An increase from 2.60 to 2.65 per hour for apprentices Last Date for Default Retirement Age The last date for retirement under the default retirement age was 5 October Pensions Auto Enrolment The first staging date for pensions auto-enrolment was 1 October 2012, for employers with 120,000 or more employees \ah20 1

2 2013 In 2012, the Government made many announcements on its proposals to reform employment law. A number of these legislative changes have, or are likely to, come into force in FEBRUARY Increase in Compensation Limits The maximum compensatory award for unfair dismissal increased from 72,300 to 74,200; the maximum limit on a week's pay rose from 430 to 450 and the minimum basic award for certain unfair dismissals increased from 5,300 to 5,500. MARCH Revised Parental Leave Directive The UK implemented the revised Parental Leave Directive in March 2013, increasing the parental leave entitlement from 13 to 18 weeks. APRIL Changes to Immigration Rules and Fees Changes to the Immigration Rules for skilled migrant workers came into force at the beginning of April. Changes were made to the Codes of Practice for workers entering the UK under Tier 2 of the points-based system. The changes introduced new salary requirements, which differ depending on whether the worker is classed as a "new entrant" or an "experienced worker", and changes to simplify the way the resident labour market test (RLMT) is conducted. There have also been changes to the list of skilled occupations, which are intended to more accurately reflect modern occupations. The addition of a number of new Engineering jobs to the list recognises skills shortages, particularly in the energy sector. New Statutory Payment Rates The rates of statutory pay increased in April, as follows: Standard rates for statutory maternity, paternity and adoption pay increased from to with the weekly earnings threshold also rising from 107 to 109; Statutory sick pay (SSP) increased from to 86.70, again with the weekly earnings threshold also rising from 107 to 109; and Maternity allowance increased from to The earnings threshold will remain at 30. The new rate of SSP came into force on 6 April and the other new rates came into force on 7 April. Real-Time Information for PAYE The new "real-time information" regime came info force, which requires those operating Pay-As- You-Earn systems to send information to HMRC electronically at the same time as payments are made. Collective redundancy consultation Reduction in the consultation period from 90 to 45 days \ah20 2

3 The Government reformed the rules on collective redundancy consultation through amendments to the Trade Union and Labour Relations (Consolidation) Act These changes took effect on 6 April and include a cut to the minimum consultation period that must take place where more than 100 employees are at risk of redundancy, from 90 to 45 days. However, this is not current government policy in Northern Ireland, where consultation on this point has been deferred. Other changes see employees on fixed-term contracts which have come to an end excluded from consultation requirements, while new guidance on collective redundancies has been produced by Acas, the publicly-funded conciliation service. Employment Law Bills and Acts The Enterprise and Regulatory Reform Bill received Royal Assent in April 2013, becoming the Enterprise and Regulatory Reform Act 2013 (ERRA 2013). The Act legislates for a number of employment law reforms, some of which will be implemented in 2013, as outlined below. The Growth and Infrastructure Bill also received Royal Assent in April 2013, becoming the Growth and Infrastructure Act The Act introduces the new 'Employee Shareholder' status which is expected to be implemented in September Further details can be found below. JUNE Portable Criminal Record Checks The DBS will be launching an Update Service which will enable individuals to register once for a criminal records check which will then be automatically updated and available for organisations to check. This is expected to be introduced on 17 June Removal of unfair dismissal qualifying period for political affiliation/opinion dismissals The Government has legislated, through the ERRA 2013, to remove the unfair dismissal qualifying period in respect of dismissals related to an employee's political opinion or affiliation. This change is expected to come into force on 25 June Reform of whistleblowing legislation The ERRA 2013 also introduces reforms to whistleblowing legislation which include a requirement that protected disclosures be in the 'public interest' to prevent workers from making whistleblowing claims for purely private matters, such as issues regarding their own individual contract. The Act will also remove the 'good faith' requirement from whistleblowing protection. Instead, tribunals will have the power to reduce compensation by up to 25% where it finds that the disclosure has not been made in good faith. These changes are expected to be implemented on 25 June The Act will also introduce protection for individuals who blow the whistle at work, from harassment by their colleagues, making employers vicariously liable for such harassment. It is anticipated that this change will be implemented in Summer EAT judges to hear cases alone The ERRA 2013 amends introduces provision for Employment Appeal Tribunal Judges to hear cases alone, from 25 June onwards, unless they are directed otherwise. This would not apply to cases which are in the process of being heard when the change comes into force. SUMMER \ah20 3

4 New Tribunal Rules of Procedure The new Tribunal Rules of Procedure are expected to come into force in Summer Changes include: new strike out powers to ensure that weak cases should not proceed to full hearing, guidance to ensure cases are dealt with consistently and that parties know what to expect and measures to make it easier to withdraw and dismiss claims, by cutting the amount of paperwork required. The new rules will also introduce a new procedure for preliminary hearings that combines separate pre-hearing reviews and case management discussions. Tribunal fees A two-tier fee structure is expected to be introduced in July A claimant will now be required to pay a fee at the issue of their claim (an issue fee) of either 160 or 250, depending on the type of claim. If the claim proceeds to a full tribunal hearing, the claimant will be required to pay a subsequent fee (a hearing fee) of either 230 or 950, again depending on the type of claim made. There will also be a fee remission scheme in place (the details of which are currently under review). Unfair Dismissal Compensatory Award Cap The Government will introduce a cap on the unfair dismissal compensatory award, to be set at the lower of 12 months' pay and the existing limit (currently 74,200). 'Settlement agreements' and inadmissible pre-termination negotiations The ERRA 2013 will rename compromise agreements as 'settlement agreements' and introduce provisions for employers and employees to be able to reach an agreement before a formal dispute arises, and be legally protected from the offer or related discussions being used as evidence in any future tribunal claim, except where there has been 'improper behaviour'. Education and Skills Act 2008 The Act changes the Statutory Framework to put a duty on all young people to participate in education or training until the age of 17 (by Summer 2013) and 18 (by 2015). SEPTEMBER Employee-shareholder contracts Employee-shareholder contracts introduce a new type of employment status under which employees give up certain statutory employment rights in exchange for shares in their employer s business. OCTOBER Executive pay: shareholders binding vote The regime for shareholder voting in relation to remuneration is set to change, with a binding vote on forward-looking remuneration policy in addition to an advisory vote on the implementation of that policy. The format of the remuneration report is also set to change. New National Minimum Wage rates implemented The Government has announced that the NMW rates that will come into force on 1 October 2013 are as follows: Standard adult rate (Age 21+) an hour Development rate (Age 18-20) an hour \ah20 4

5 Young workers rate (Age and not apprentices) Apprentices (under 19 or in first year) Reform of the TUPE Regulations The Government has announced plans to reform the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) Regulations. Proposals include: the removal of the Service Provision Change provisions, allowing greater freedom for transferee employers to change terms and conditions after a transfer and a number of changes which aim to assist transferees to make business changes more quickly. The Government has set out its intention to begin implementing changes in October 2013, with the exception of the SPC reform. Expected 2013 Removal of discrimination questionnaires/ third party harassment - The Government is set to amend the Equality Act 2010 (EqA 2010) to abolish the discrimination questionnaire procedure and remove employer liability for harassment by third parties. This is expected to be implemented in 2013, but no exact date has been set. ON THE HORIZON There are also a number significant legislative developments which were announced in 2012/2013, and are expected to come into force in coming years or do not yet have an expected implementation date. These include: Mandatory Acas Early Conciliation (Expected 2014) Financial penalties for losing employers (Expected 2014) A new Health & Work Assessment & Advisory Service (Expected 2014) Extension of the right to request flexible working (Expected 2014) Equal pay reporting/ auditing (Expected 2014) Shared parental leave (Expected 2015) New scheme for tax-free childcare (Expected 2015) Removal of Tribunal's powers to make Wider Recommendations (No date set) Protection from caste discrimination (No date set) Amendments to Working Time Regulations (No date set) Further details of these changes can be found in our horizon watching document. To access this document, click here \ah20 5