The qualifying period for an employee to bring a claim for unfair dismissal will be increased from one year to two years with effect of 6 April 2012.
Further, in an unprecedented move, by April 2013 Claimants will be required to pay a fee when lodging an employment tribunal claim in the region of £250 with a further fee of £1,000 to be paid before a case is listed for hearing. Losing Respondents will also be ordered to pay up to £5,000 by the Tribunal; not to the Claimant but to the Treasury.
The press release accompanying these announcements estimates that these changes will result in 2,000 less employment tribunal claims being brought each year. Further, not only will the reforms save businesses up £6 million per year in time, money and resources in having to defend claims, the hope is that Claimants will be deterred from bringing more speculative claims.
However, the reforms so far lack detail and, once again, employees and employers alike will be unsure how to view or even plan for the new changes as there are still many unanswered questions:
- Will the increase in the qualifying service only apply to employees who commence employment from 6 April 2012?
- If not, how will the change affect those employees who have obtained one year’s service but not two years by 6 April 2012? Do they automatically lose the right to bring an unfair dismissal based on normal principles until they have been continuously employed for two years?
- Will Claimants be means tested before they are required to pay tribunal fees?
- If so, what factors will be taken into account and will this not only serve to undermine the purpose of introducing these reforms as some Claimants may be deterred from bringing claims whereas others will not if they are exempt from paying any fees?
- It is proposed that a Claimant will recover any tribunal fees (although not necessarily legal fees) if successful in their claim. Will fees be reimbursed by the employment tribunal service or met by the Respondent?
Hopefully clarity on the finer points will follow over the coming months.
For now, what is clear is the Government’s continued policy to afford greater protection to businesses during a time of considerable financial uncertainty as part of its mission to cut red tape and to reduce the number of claims being lodged at the employment tribunal.
This is further supported by David Cameron announcing last week that the Government would shortly consult on introducing protected off the record conversations between employers and staff regarding performance and other employment issues without the employer fearing that such conversations could be relied upon if a matter becomes contentious at a later date.
If such measures are brought in, the already announced reforms are likely to be only the start of the wind of change that will sweep through current employment laws over the next 18 months.
Please call or email David Johnson with any questions on 020 7288 4714