IN THE PIPELINE FOR 2012 AND BEYOND

Updated 29/1/12. This information updates various other sections in The Russell-Cooke Voluntary Sector Legal Handbook.

Changing in 2012
1 February 2012: Increase in "weekly pay" for calculating statutory redundancy pay; increase in maximum awards for unfair dismissal and other awards. See Weekly pay for redundancy pay and unfair dismissal awards.

6 April 2012: The national insurance earnings threshold for statutory maternity, paternity, adoption and sick pay will increase from £102 to £107. Statutory sick pay and maternity, paternity and adoption pay from £128.73 per week to £135.45. See Statutory sick pay and Statutory maternity, paternity and adoption leave and pay.

Subject to parliamentary approval, the qualifying period to claim unfair dismissal will be extended from one year to two years. This will apply only to employees whose qualifying period starts on or after 6 April 2012 — so anyone employed by the employer on 5 April will still be able to claim unfair dismissal after only one year. See Qualifying period to claim unfair dismissal.

Employees with certain types of pension will no longer be able to contract out from the additional state pension (state second pension). See Contracting out of additional state pension.

4-5 June 2012: Additional bank holiday on Tuesday 5 June for the Queen's diamond jubilee, with the late May bank holiday moved to Monday 4 June to create a long weekend.

1 October 2012: Auto-enrolment of eligible employees into a pension scheme starts, for employers with more than 120,000 workers (unlikely to apply to anyone reading this website, I think). This will be followed by phased implementation based on number of employees. See Auto-enrolment and the national employment savings trust.

In the pipeline: Resolving workplace disputes
The government consulted from 27 January to 20 April 2011 on proposals to simplify resolution of workplace disputes, and announced its response on 23 November 2011. The consultation documents and response are on the BIS website at tinyurl.com/6r66cxv.

Protected conversations. It is expected that there will be a consultation on the introduction of "protected conversations", which would allow employers to discuss issues such as retirement or poor performance in an open manner with staff, without this being used in any subsequent tribunal claims. Protected conversations would not extend to protect discriminatory acts.

Compromise agreements. The government will consider measures to simplify compromise agreements, and will rename them settlement agreements. A compromise agreement is a legally-defined agreement under which an employee whose working relationship with the employer has become irretrievable agrees, in return for a negotiated financial sum, not to bring a tribunal claim against the employer. The simplification measures could include a standard text for compromise agreements, and amendment of the Employment Rights Act 1996 s.203(3)(b) to make it easier for compromise agreements to cover current and future claims.

To make clear that compromise agreements can be safely used to settle discrimination claims, s.147 of the Equality Act 2010 will be amended [see Compromise agreements and discrimination claims].

Mediation. Mediation schemes are being set up as pilot projects, where employees who are trained as mediators can help resolve employment disputes at an early stage in small and medium enterprises. See Employment disputes and settlement.

Rapid resolution. Following on from suggestions made during the consultation process, the government will consider whether and how a scheme could be introduced as an alternative to the current tribunal process, to provide quicker, cheaper determinations in low value, straightforward claims such as holiday pay. This could involve non-judicial determination based only on papers, without an oral hearing. Any proposals would be subject to consultation.

Early conciliation. Details of all employment claims will have to be submitted initially to ACAS, before they can be lodged with the tribunal. Claimants will be offered pre-claim conciliation, but there will be no obligation on either party to take up the offer. This is different from the original proposal, which would have required all claims to go through pre-claim conciliation with ACAS before they could go to tribunal.

Modernising tribunals. A fundamental review of employment tribunal rules of procedure is being undertaken, with a view to a revised code being issued by April 2012. The review will address concerns that tribunals have become increasingly complex and inefficient over time and are no longer fit for purpose. The government intends to introduce changes in relation to cost and deposit orders, witness statements and witness expenses, and for employment judges to sit alone in unfair dismissal cases. Other changes are likely to follow from the review.

Financial penalties. Financial penalties of up to £5,000 are to be introduced for employers who breach employment rights, so as well as paying compensation to the employee, they could be required to pay a penalty (a fine) to the Exchequer of up to 50% of the tribunal award, subject to a lower limit of £100 and an upper limit of £5,000. Employment judges would have discretion as to whether to serve a penalty on the employer.

Calculation of award and payment limits. Employment tribunal awards and statutory redundancy payments will continue to be automatically up-rated [see Weekly pay for redundancy pay and unfair dismissal awards], but the formula will be modified so they are rounded to the nearest pound. Announcing this change on 23 November 2011, Vince Cable said, "We anticipate that the reduction in redundancy pay and subsequent reduction in associated compensation payments made in employment tribunals will have a direct net saving to business of £5.4 million each year" — so it seems clear they are planning to round down, not up.

In the pipeline: Red tape challenge
The government's "red tape challenge" focused from 3-26 October 2011 on 159 employment-related regulations, under four headings: taking people on, managing staff, letting people go, and compliance and enforcement. Its plans to merge, simplify or scrap 70 of those regulations were announced on 23 November 2011 and are summarised on the red tape challenge website at tinyurl.com/7nh4llr. Some are included in the government's dispute resolution proposals [above]. The other proposals include the following.

Recruitment. The government will consult in spring 2012 on streamlining the current regulatory regime in relation to the recruitment sector.

CRB checks. Criminal Records Bureau checks will be portable, so there will be no need for a fresh application when moving jobs. A universally portable CRB check will be created from early 2013, that can be viewed by employers instantly online. Work on this will be led by the Home Office. It sounds very like what was planned for 2010...

TUPE. In a call for evidence launched on 23 November 2011, the Department for Business, Innovation and Skills (BIS) asked for views on a series of questions about the effectiveness of the Transfer of Undertakings (Protection of Employment) Regulations and proposals to simplify them. Details are on the BIS website at tinyurl.com/8xs8zyp and the deadline is 31 January 2012. If the balance of evidence indicates that the regulations should be changed, there will be a consultation in 2012.

Whistleblowing. A loophole in whistleblowing law, which allows employees to blow the whistle about their own personal work contract, will be closed.

Minimum wage. 17 national minimum wage regulations will be merged into one set.

Dismissal. The government will launch a call for evidence on the implications of compensated no-fault dismissals for micro-firms with fewer than 10 employees, and on ways to slim down existing dismissal processes and how they might be simplified. This could potentially include working with ACAS to make changes to their code, or supplementary guidance for small businesses.

Micro-employers. At various times during the year (for example, in the plan for growth launched alongside the budget on 23 March 2011) the government has said there would be a three-year moratorium, starting 1 April 2011, on new regulation for businesses with fewer than 10 employees and start-up businesses. This is not going to happen, or at least not yet, and small employers should not be under the impression that new legislation will not apply to them. Similarly the media have occasionally given the impression that even current employment legislation will not apply to these micro-employers. This is not the case. The only current employment proposal that relates specifically to micro-employers is the one above, on the possibility of no-fault dismissals.

Redundancy. In another call for evidence launched on 23 November 2011 the Department for Business, Innovation and Skills asked for views on the effects of the 90-day consultation period where there will be more than 100 redundancies, and whether the period should be reduced to 60, 45 or 30 days. The call for evidence, which is likely to be followed by a consultation, is on the BIS website at tinyurl.com/8yq34fv and the deadline is 31 January 2012.

Tribunal fees. The Ministry of Justice published on 14 December 2011 a consultation on the introduction of fees for anyone wishing to take a claim to an employment tribunal. Currently there is no charge. The change is intended to bring the employment tribunal in line with other civil courts, and to encourage employees to settle disputes through mediation or conciliation.

There are two alternative options. In the first, all claims would involve payment of fees, with the fee depending on the nature of the claim. There are three suggested levels ranging from £150 to £250 for the issue of a claim and £250 to £1,250 if the claim goes to a hearing. Level 1 would cover claims for unpaid wages and redundancy payments, level 2 unfair dismissal, and level 3 discrimination and whistleblowing.

The second option would involve an issue fee of £200 to £600 with the maximum award limited to £30,000, or £1,750 where the claimant is seeking an award over £30,000.

If the first option is chosen, fees would be introduced in late 2013. The second option would require new primary legislation to set the cap on the maximum award, so would not be introduced until 2014.

For the employment appeal tribunal, an issue fee of £400 and hearing fee of £1,200 are proposed.

The government will waive fees for those who cannot afford to pay, and will continue to fund the costs of ACAS. The tribunal would be given the power to order the unsuccessful party to reimburse fees paid by the successful party.

The consultation documents are on the Ministry of Justice website via tinyurl.com/bqwo3hv. The deadline is 6 March 2012.

In the pipeline: Modern workplaces
The government consulted from 16 May to 8 August 2011 on its "modern workplaces" proposals on parental leave, flexible leave, equal pay audits, and changes to the working time regulations. The consultation documents are on the BIS website at tinyurl.com/896ojpt and the press release is at tinyurl.com/89kdkyh. The government's response is expected in early 2012.

Shared parental leave. Under proposals for a new system of shared parental leave — which would not be in effect before 2015 — mothers will be entitled to 18 weeks paid maternity leave around the time of the birth, to be taken in one block, and as at present fathers/partners will be entitled to two weeks ordinary paternity leave and pay at the time of the birth. In addition each parent will be entitled to four weeks paid leave, to be taken in the child's first year, and 30 weeks of additional parental leave will be available to either parent. Of these 30 weeks 17 will be paid. The 30 weeks can be broken into blocks between parents, and both parents could take the leave at the same time. However an employer could require an employee to take their leave in one continuous block, if agreement about the timing of the leave could not be reached. Employers would be able to ask staff to return for short periods to meet peaks in demand, or to require that leave is taken in one continuous block in order to meet business needs.

Under these proposals, the total time available for maternity/paternity leave would increase from 54 to 58 weeks.

Similar provisions would apply for same-sex couples and adopters.

Unpaid parental leave. At present, each parent is entitled to 13 weeks unpaid parental leave, to be taken before the child's fifth birthday, or 18 weeks until the child's 18th birthday if the child is disabled. It is proposed that this entitlement be extended to 18 weeks for all parents. This is expected to take effect from April 2012.

Antenatal appointments. The consultation includes a proposal giving fathers/partners the right to take unpaid leave to attend antenatal appointments.

Flexible leave. It is proposed that the right to request flexible working [see Flexible working to care for children] be extended to all employees who have been with their employer for 26 consecutive weeks, not just those who are parents or carers as at present. The current statutory procedure for flexible working requests would be replaced by a statutory code of practice for employers and a duty to consider requests reasonably, but there are no plans to alter the current eight business reasons for an employer to turn down a request.

At present employees can request flexible leave only once in a 12-month period. Under the proposals they would be able to make a further request within 12 months where the initial request was for a temporary arrangement.

Mandatory equal pay audit. An employment tribunal that has found an employer to have discriminated on the basis of gender in relation to pay will order the employer to conduct a pay audit and publish the results, except in specific circumstances such as where an audit has already been carried out in the past three years.

Working time regulations. The modern workplaces consultation also included proposals to amend the Working Time Regulations 1998 (WTR) so that annual leave entitlements can be rescheduled, and carried over to the next leave year, when a worker falls ill during planned annual leave. This would be limited to the four weeks of Working Time Directive leave. The government also intends to amend the WTR to allow the carry-over of annual leave due to maternity, paternity, parental or adoption leave — this will include the full 5.6 weeks of leave entitlement per year.

The consultation also sought views on giving businesses greater flexibility around annual leave, by allowing them to buy out untaken leave or to defer taking leave until the first six months of the following leave year where there are justifiable business grounds. These provisions would apply only to the 1.6 weeks of domestic statutory leave.

It is expected that these proposals will take effect from April 2012.

In the pipeline: Equality consultations
Third-party harassment. In its plan for growth launched on 23 March 2011 alongside the 2011 budget, the government said it would consult on removing the "unworkable" requirements in s.40 of the Equality Act 2010 for employers to take reasonable steps to prevent harassment of their staff by customers, clients and other third parties [see Equality Act part 5: Work].

Discrimination compensation. The government announced on 11 May 2011 that it would look in detail at concerns about the high level of compensation awarded by employment tribunals in some discrimination cases, and whether this leads some workers to take weak, speculative or vexatious cases in the hope of a large award and/or leads employers to settle such cases before they reach the tribunal. The press release from the Department for Business, Innovation and Skills is at tinyurl.com/85qboqk.

As far as I am aware nothing further has happened on either of these.

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