Employment law is undergoing one of the most significant shake-ups in years at the moment, with more key dates looming next week as a raft of changes to employment law come into force.
Business Secretary Vince Cable has been extremely vocal in both his support and criticism of some reform suggestions.
He used his conference speech on Monday to lambast those seeking major relaxations to employment law essentially hoping for a return to a 'fire at will' employment culture.
"We have seen off the 'head bangers' who want a hire-and-fire culture and seem to find sacking people an aphrodisiac: totally irrelevant in a country with flexible labour markets which have created over a million private sector jobs in the last two years," he told the Liberal Democrat conference in Brighton.
However, he seems to remain committed to the 'deregulation agenda' proposed by the Coalition, which will see changes in several major areas of employment law.
Unfair dismissal
The Coalition is currently proposing to cut the maximum compensation available for unfair dismissal. At present the maximum award available is £72,300. The award has increased more than five times over in the past 13 years. By contrast, no such cap exists on claims for discrimination.
The Government would like to cap the maximum award for unfair dismissal and is currently considering two alternatives: one that will see it capped at around double the current average UK salary of around £20,000 per annum and another that would see it capped at just one years' salary.
However, commentators have pointed out that whilst the maximum is very high, the average award in unfair dismissal cases is around £5,000, nowhere near the proposed new limitation. This has not deterred policymakers, who favour the cap as a way of reducing the 'appeal' of making a claim. It is hoped that lowering the cap will reduce the number of unfair dismissal claims, which has risen steeply in recent years.
Employment law changes in October
October will be a busy month for employment lawyers, with a string of major changes to employment law affecting businesses. The National Minimum Wage is being increased from Monday, from £6.08 to £6.19 per hour for adults. The rates for those aged 18-20 and 16-17 are remaining the same.
Pensions are also due a shake-up on Monday 1 October, with new rules coming into force which will make it obligatory to enroll eligible staff onto a pension scheme if they have not enrolled into one already. Monday will only be significant for the biggest firms with more than 120,000 employees. Relevant dates from smaller firms are 1 October 2013 for businesses with 800-1,249 employees, and 1 April 2017 for any employer with no existing PAYE scheme.
The fifth of October is set to be the last day of work for any employee covered by the old default retirement age provisions, which were repealed on 6 April 2011. Under the rules anyone covered had to be given 12 months' notice and could apply for an additional six months' work beyond their final retirement date. The last of these employees will finish their employment next week.
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Sources:
Will new unfair dismissal plans work? (BBC News)
October 2012 employment law changes: what employers need to know (Personnel Today)
Vince Cable lambasts employment law 'head bangers' (The Telegraph)
The maximum award is frightening for employers, but the random nature of the award is frightening all-round. I see complaints online of Employment Tribunals overloaded with work, and know from experience that they can remove large parts of a case as not having a "reasonable prospect of success" without having any way of understanding what the case is about, reading any evidence, or having the claimant in the room. Failure to request evidence from the other side is another problem. And over-funded cases by public sector or public-funded employers who can complicate a case and run-up expenses in order to conceal from the court how strange and anti-social their real internal workings can be to staff and clients.