What’s new in employment law for 2014? My Top 5

This year has felt like a busy one for employment law.  Companies have been dealing with the impact of fees in the Tribunal, a new cap on unfair dismissal compensation, the introduction of “protected conversations” and the re-branding of compromise agreements as settlement agreements.  I am finding the last one the most difficult – I just can’t stop calling them compromise agreements!

2014 looks like it should be a little quieter but I have selected five changes that are of most relevance to our clients.

1.  Small changes to the TUPE Regulations.

In January 2014 we are due to see some changes to TUPE.  The government had proposed to dis-apply TUPE from “service provision changes” where a particular service is brought in-house by a client, outsourced or transferred to another contractor.  This change would have been of particular interest to our many IT clients but it is not to be.  Service provision changes will remain but  the activities carried on after the change must be “fundamentally or essentially the same” as those carried on before it.  This reflects existing case law and so is nothing extraordinary.

The main changes are that the deadline for the transferor to provide the transferee with certain employee liability information will be extended to 28 days before the transfer, rather than just 14 days at present.

In addition, a change in the location of the workforce following a transfer will be expressly included within the scope of an economic, technical or organisational reason entailing changes in the workforce (ETO reason). This mean that dismissals as a result of a change of location will not be automatically unfair.

Finally, micro businesses (fewer than 10 employees) will be able to consult directly with affected employees where there is no trade union in place.

2.  Mandatory pre-claim ACAS conciliation

From 6th April 2014 all would-be Employment Tribunal claimants will have to submit details of their claim to ACAS.  In return ACAS will offer pre-claim early conciliation for a period of one month.  If either party refuse or it goes ahead but doesn’t result in settlement, then the claimant will be able to issue their Tribunal claim as normal.  In addition, the conciliation process will “stop the clock” on the (normally three month) limitation period.  The prospective claimant will be unable to pursue most Tribunal claims without the ACAS certificate to confirm that conciliation has been tried but failed.

It will be interesting to see if this results in fewer Tribunal claims.  Coupled with the recently introduced fees (£250 to start an unfair dismissal claim and a further £950 to get to a hearing) I can see some employers simply waiting to see if the Claimant is serious about paying to start the claim.  On the other hand, it might save money to deal with these issues promptly and the employer could end up paying those fees on top of any compensation or settlement payment.

I also expect that there will be some litigation over the “stop the clock” provisions so watch this space.

3.  New flexible working regime

In Spring 2014 we should have new rules on flexible working.

They will extend flexible working rights to all employees with 26 weeks’ service, rather than just those employees who qualify as parents or carers.

Businesses will no longer be required to follow the statutory procedure regarding flexible working requests, which are considered by some as being too rigid and daunting.  Instead requests must be considered reasonably.

There will be a code of practice surrounding the new regime, which in its draft form is just one and a half pages long.  In my view most employers will not have to make amendments to their existing procedures in order to comply.

4.  New approach to sickness absence management

In February 2011, the government commissioned a review of sickness absence in the workplace.  This is a real issue for many clients who can find sickness and returning to work difficult to handle.

In response to the review the government is introducing a Health and Work Assessment and Advisory Service from Spring 2014 which will provide:

– A state-funded assessment by occupational health professionals for employees who are off sick for four weeks or more.

– Case management for employees to help facilitate their return to work.

Many employers rely on occupational health assessments already but this public-funding could help many more.  The government also intends at some point to abolish the SSP record-keeping obligations and allow businesses to keep records in a flexible manner more suited to their organisation.

5.  Financial penalties for employers who lose Employment Tribunal claims

From 6th April 2014 Employment Tribunals will have the discretion to impose a financial penalty on employers who lose their cases of up to 50% of any financial award.  There will have to be “aggravating features” in the claim and the award will be between £100 and a maximum of £5,000.  Similar to other “fines” only half the amount will be due if payment is made within 21 days.  Interestingly, the money goes to the government and not the claimant. Notwithstanding the recipient, this will no doubt put some pressure on employers to settle claims rather than defend them at a hearing.