Although it may still be some time before the Employment Rights Bill is passed and the changes will mostly likely be implemented in stages, we thought it would be helpful to highlight some of the key changes to look out for in preparation of the Bill becoming legislation. Below we have highlighted four key changes that we feel both employers and employees should be aware of.
1. Qualifying Period for Unfair Dismissal
The Employment Rights Bill seeks to eliminate the current two-year service requirement to be able to bring a claim for unfair dismissal. Employees will have the right not to be unfairly dismissed from day one. Regulations are expected to set out a light touch procedure that allows dismissal during an “initial period” as long as the employer follows the correct procedure. The procedure is likely to include requirements such as having a meeting with the employee to discuss concerns and showing that the reason for dismissal is related to the employee’s conduct, capability, statutory restrictions or some other substantial reason related to the employee. Notably, redundancy is not included. The Government has not yet specified how long the “initial period” will be for but its current preference is nine months.
2. Limitations on Fire and Rehire
Previously, if an employee refused to agree changes to the terms of their employment contract, they could be dismissed and then rehired on the new terms. The Employment Rights Bills proposes changes that would mean that if an employee is dismissed for this reason, then the dismissal would be treated as automatically unfair. As a result of business raising complaints that this would severely limit their ability to make legitimate changes to employment contracts, the Government has proposed amendments in an effort to soften the ban. The proposed amendments include changes such as the dismissal only being automatically unfair if the employee refused to agree to a “restricted variation”. A list of “restricted variations” has been provided and they include variations to pay, hours, pensions and time off.
3. Changes to Whistleblowing Laws
Although not currently backed by the Government, major changes have recently been proposed to the whistleblowing laws. One key change is that it will be a requirement for the disclosure to actually be in the public interest rather than the whistleblowing just having to show they reasonably believed it is in the public interest. Changes will also be made to the list of qualifying disclosures that fall under current whistleblowing laws to include mismanagement of public funds and abuse of authority. Employers with over 50 members of staff, a turnover of £10 million+ or certain named sectors will have a new obligation to take reasonable steps to investigate any protected disclosure and an employer that intentionally or recklessly subjects a whistleblower to detriment is at risk of being issued a maximum fine of up to 10% of their global turnover by the Employment Tribunal.
4. Banning of NDAs and Confidentiality Agreements
If an agreement between an employer and a worker contains clauses that purports to prevent the worker from making allegations or disclosing information relating to certain work-related harassment or discrimination, the contract will be void. The Government has said that this will not apply to ‘excepted agreements’ that satisfy conditions set out in regulations by the Secretary of State but we currently do not have any further information as to what will constitute an “excepted agreement”. Our thoughts are that they will be similar to Employment Settlement Agreements where it is a requirement to seek independent legal advice before the agreement can become legally binding.
If you require any further information or advice, please contact our Employment Department.
