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September 2012 Updates

The government consults further on
employment law reform

It has been announced that the Government will not be introducing a 'no-fault dismissal' for micro businesses following its call for evidence.

However, the Government continues to consult further into employment law reform. The Department for Business Innovation and Skills (BIS) has just published its 'Ending the Employment Relationship' consultation. The consultation focuses on two key things:

  • Reducing the compensation cap on unfair dismissal awards to up to 12 month's pay (where this is less than the overall cap), and introducing a 14 day payment deadline.
  • Increasing the use of settlement agreements, a consensual, legally binding document which can be used to end an employment relationship. BIS also plans to make offers of settlement inadmissible in cases of unfair dismissal. The government has requested that Acas draft a new Code of Practice on Settlement Agreements clarifying their use.

BIS is inviting responses to its consultation, you can submit yours via this link:

For information or advice on the above, please contact us.

Here come the girls?

It has recently been reported that the number of women on European Boards has doubled from 8% to 16% in the past eight years.

According to data from Europe's largest companies, 86% of businesses have at least one woman on the board; this figure is slightly higher in the UK, at 95%. If this trend continues as expected, women are likely to account for 25% of European board roles by 2017. In fact, the EU Justice Commissioner may announce proposals later this month requiring European listed companies to reserve at least 40% of non-exec board positions for women by 2020.

Karoline Vinsrygg, a consultant at Egon Zehnder International said: "It took about 50 years for women to fill 13% of board seats in the UK; it has taken them only one year to fill an additional 5%."

National minimum wage regulations

The National Minimum Wage (Amendment) Regulations 2012 come into force on 1 October 2012.

This legislation will change the rates of the national minimum wage following recommendations from the Low Pay Commission. The hourly rates will be as follows:

  • The standard adult rate (for workers aged 21 and over): £6.19.
  • The development rate (for workers aged between 18-20): £4.98.
  • The young workers rate (for workers aged under 18 but above the compulsory school age): £3.68.
  • The apprentice rate: £2.65.

An unsettling agreement

The recent case of Gallop v Newport City Council has raised important questions, especially in light of the Governments plans to increase the use of settlement agreements.

The parties involved in the case had tried to come to a compromise or 'settlement agreement' to no avail. The case went on to reach Tribunal proceedings, during which, the aforementioned settlement was referred to as a result of an innocent enquiry. It was held that although Mr Gallop had been unfairly dismissed, had this not been the case, he was only 50% likely to enter into the agreement. As a result he was awarded 50% less compensation.

Upon appeal, it was decided that the Tribunal had made the wrong decision, as the existence of the compromise agreement was only established following an innocent enquiry. Mr Gallop was therefore awarded his full compensation.

ECHR at a 'cross' roads regarding
religious discrimination?

The European Court of Human Rights ("ECHR") has begun hearing two cases which could change the law regarding religious discrimination. Nadia Eweida and Shirley Chaplin are petitioning to be allowed to wear their crucifixes at work.

If their claims are successful, it could mean that employers will have a duty to allow their workers' to manifest their religious beliefs within the workplace, and to accommodate this wherever it is reasonable to do so. Therefore, the Court will have to consider how to balance the employee's right to act on their beliefs against the employer's discretion as to how it operates.

David Cameron announced earlier in the year that he intended to change the law so that, similarly to in the US and Canada, people could wear religious symbols at work.

In light of this, employers may consider updating their policies. Contact us for further details.

The Employment Lawyers Association supports
Employment Tribunal reform

Earlier this year the government announced the publication of Mr Justice Underhill's recommendations following his review of the Employment Tribunals procedure.

This review has been supported by the Employment Lawyers Association ("ELA) of whom Julie Stewart is a member. The ELA has conducted a number of surveys on the subject and now intend to form a working party to consider the matter further.

The recommendations include:

  • New rules to ensure effective case management (e.g. simplified and streamlined procedures for hearings and withdrawing cases).
  • New presidential guidance informing parties of what to expect at Tribunal.
  • A rule allowing Tribunals and Judges to encourage the use of alternative forms of dispute resolution at all stages of the Tribunal process.

Check our website for further details of the reform process and how it may affect you.


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