SME concessions fail to promote interests of most employees.

Employers with fewer than 250 staff will be exempted from having to give staff the right to request time off for training. This is just the forerunner of what could be a series of measures designed by the UK government to assist smaller employers.

Mark Prisk, the Business Minister at a meeting with the Federation of Small Businesses in Liverpool yesterday, made the announcement that there will be a thorough review of the effect of regulations on small businesses.

Whilst it is to be welcomed that measures are being looked at to aid business recovery in the UK, there is a danger that the rights of individual workers will be seriously eroded. It is worth noting that SMEs account for the employment of approximately 51% of all employed workers in the UK. Measures which take rights away for employees will, therefore, affect the majority of the working population.

An exemption from having to give workers the right to request time off for training is one thing, but if there are reductions in the more basic employment rights, such as changing the right to claim unfair dismissal so that a qualifying employee must have 2 years' continuous service, the progress that has been made over many years in protecting employees could be reversed.

Employment rights have been established for good reasons. There has to be a balance between the right of free enterprise on the one hand and the right of individuals to have some form of security of job tenure and freedom from oppression.

Some say that the scales have tipped too far in favour of workers. Others argue that the law should remain as it is and that it is for employers to learn to act reasonably, fairly and without discrimination when managing their staff.

In times when there is a scarcity of national funding to inject into UK businesses to aid recovery, is this simply a case of the Government wanting to be seen to be doing something to assist SMEs and playing with legal restrictions as some kind of token gesture at the expense of employee rights in the longer term?

Employment Lawyers Want Reforms to the Employment Tribunal System

11 days ago Andrew Berk asked a question on LinkedIn (Employment Lawyers Networking & Referral Group):

"What reform(s) to the Employment Tribunal System Would You recommend?"

Lawyers responded with the following suggestions and concerns:

• increase to £75,000 the power of the tribunals to deal with contractual claims
• do ETs have the expertise to deal with the range of issues that one sees across the employment/commercial contract sphere?
• there are too many cases brought which have no reasonable prospect of success; a more robust approach to awarding costs would help address this , especially where a party has made reasonable attempts to settle and the other party has refused, been obstructive or delayed entering into negotaitions. The cap on. costs which can be made by a Tribunal without having costs assessed , should be removed
• There ought to be an equivalent Part 36 jurisdiction in ET proceedings.
• I would like to see the tribunal's jurisdiction extended to cover freestanding bullying and harassment outside of discrimination.
• It's controversial, but how about this - a Claimant who is dismissed for alleged poor performance or misconduct and whose dismissal letter and references record that,should be able to go to an ET and if successful, get those documents expunged from their record with a "Tribunal ordered" document or record to replace them.
• My experience of Judicial mediation has been very positive but all too often one party will not agree to using it only to settle at a later stage - unreasonable refusal should also have some sort of penalty ?
• To introduce a more robust costs regime (and I include a Part 36 type procedure as part and parcel of that) would only serve to increase costs for both parties. It inevitably carries the danger of detailed assessment by either an Employment Judge (and they are busy enough already) or by a District Judge with little or no knowledge of the complexities of an Employment case. The tools are there, the ET just needs to be willing to use them.
• Surely, there should be some sort of Pre-Hearing Review mechanism (without the stigma) for each case (although it may not be administratively workable) so that each case is reviewed at an earlier stage so that any possible issues i.e. limitation/jurisdiction, poor merits etc are dealt with and claims and responses without any reasonable prospect of success are thrown out.
• In my view the current rules are fine, they're just not used effectively by the Tribunals. I agree completely about the failure to punish those parties who do not comply with Orders.

So there we have it. In a matter of a few days we see different views from various practitioners. This debate itself shows the difficulties that face the architects of new legislation on how the tribunal system should function for the better. The lack of consensus is to be encouraged, for it demonstrates the varied creativity of the professionals in this arena. To get the best ideas, you need to start with lots of ideas (ref. Thomas Edison).

Let's have more views, please.

Videos of Employment Tribunal Process

The Employment Tribunals Service has now published two videos online to show briefly how a case runs in practice.

Viewers can see what a typical tribunal hearing room looks like, how witnesses book in with the tribunal clerk, take the oath or make an affirmation, read out their statements and undergo cross-examination.

Financial details of payout under compromise agreement to CEO of Council were disclosable

Craven District Council has been forced to disclose the financial details of a compromise agreement it entered into with a former Chief Executive Officer, because this information concerned the use of public funds. This was the recent decision of the First-tier Tribunal (Information Rights).

It was accepted by the tribunal that the majority of the information in the compromise agreement was exempt from disclosure under section 40(2) of the Freedom of Information Act 2000, because there was a strong expectation of privacy in connection with a compromise agreement. It would be unfair to require disclosure.

However, the Tribunal did not consider it reasonable to expect that information relating to the use of public funds could be kept back from the public on the strength of a confidentiality clause in the compromise agreement. The Tribunal was influenced by the fact that the former CEO was the most senior officer at the Council. In addition, they took into account the circumstances in which the CEO had left the council: there was an ongoing financial crisis at the time,an £800,000 overspend and a requirement to save £2.5 million.

ACTION POINT

One of the motivating factors for an employer to settle matters with a disgruntled employee is to avoid publicity. Negotiated figures sometimes reach higher levels when the employer is confident that the monetary terms are protected from disclosure by a confidentiality provision in the settlement agreement.

With this latest case, publicly funded bodies are reminded that when considering what can be withheld from public knowledge, it is not as clear cut as they might otherwise have thought.

Top 3 Employment Law Focus Areas in 2011

There are so many issues in employment law at present that it is far from easy to pick what are arguably the 3 top areas to receive focus this year. Nevertheless, I have given it a crack and here are my top 3:

1. Agency Workers Regulations (AWRs)

This has to be my number 1 foucs area. It will have huge commercial impact for those companies that use temporary workers and for the agencies that supply them.

The AWRs are due to come into force in October 2011. The key feature is that after a qualifying period of 12 weeks agency workers will be entitled to receive the same pay as comparable workers within the client business or organisation.

I know that agencies who supply temps and companies that hire them are looking at ways of minimising the adverse commercial effect of the AWRs. This is going to be a difficult task; the AWRs contain anti-avoidance provisions.

Businesses have for a long time looked upon the availability of agency workers as a means of keeping a lid on labour resource costs. At a time when UK plc is looking to pull itself out of recession, increased workforce costs are most unwelcome and restrictive. We will have to wait and see what ingenious solutions arise.

2. The abolition of the default retirement age

The UK workforce was used to the situation for many years where their employer could dismiss them and there would be no unfair dismissal claim if the employee was over the retirement age. Then the Age Regulations permitted "retirement" as a fair reason for dismissal, provided a fairly complex procedure was followed. So long as the employer followed that procedure, the employee could not complain of being dismissed on retirement.

All this will change from October 2011. From that point on, age alone cannot be a fair reason for dismissal. What can an employer do, then , if it has concerns that the age of the employee may affect their ability to do the job properly?

If an employer wants to dismiss fairly an employee over the retirement age for poor attendance or poor performance, they are going to have to follow a fair capability procedure or fair performance procedure. They will also need to show that they do not in a discriminatory way just apply those procedures to older staff. The procedures will have to be used throughout the workforce, whatever the age.

3. TUPE and administrations.

In a post on my blog on 24 Febraury 2011 I dealt with the recent case OTG Ltd v Barke and others.

The upshot of that case is that a sale of a business by an administrator, whether the sale is by way of a pre-pack or other administration process, will be caught by the Transfer of Undertakings (Protection of Employment ) Regulations 2006 so that employees will transfer to the buyer and any pre-transfer dismissals will be connected to the transfer and so automatically unfair.

This situation may appear to be good news for employees. But I feel it is likely to be disastrous for both employees and businesses. The requirement to take on a workforce which the previous employing company has been struggling to sustain is likely to be a deterrent to many buyers. The result could well be that administrators are unable to sell the business and are left with no alternative than to make all staff redundant, break up the business and sell off its assets.

That result is neither in line with the interests of good commerce, nor a sustained level of employment. For me, this development will be a material one for administrations in 2011.