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Red tape, TUPE and sickness changes - the first of our regularl updates on employment law

Are we facing a deluge of red tape?

Recent years have seen frequent changes to employment law. It has been hard enough at times for me as an employment lawyer to stay on top of all new legislation together with a raft of case-law decisions in both the UK and Europe courts so I have every sympathy for employers who have faced having to which employers have had to digest and in many cases spend time and money ensuring that they fully understand and implement.
The Government is committed to cutting down on red tape, and reducing the regulatory burden on employers in general which, it is hoped, will improve the competitiveness of UK business in general and give the economy a kick-start. If early indications are anything to go by, 2013 is going to continue the trend of increased regulation. The Enterprise and Regulatory Reform Bill currently being debated in Parliament will, if passed in its present form, lead to several significant changes to UK employment law. The Government has just announced several consultation papers relating to changes to employment law, as well as responses to previous consultations. Taken together, these, provide us with a clearer idea of the detail of some of the Government’s proposals and what their likely impact will be in practice.

Tribunal Compensation

First, the Department for Business Innovation and Skills (“BIS”) has announced that there will be changes in the way that Employment Tribunals calculate unfair dismissal compensation. If implemented, a maximum amount of 12 months’ loss of earnings will be awarded, but is this necessarily a good thing or could it end up being used as a new compensation benchmark in settlement discussions?  

Confidential negotiations

BIS has also published the Government’s response to earlier consultation about ways of ending the employment relationship, which will introduce the concept of “confidential negotiations”, potentially allowing employers and employees to have frank discussions about an employee’s future without the content of those discussions being raised in any subsequent Employment Tribunal claim. Whether or not these negotiations become the norm remains to be seen, but it seems to me that there is scope for plenty of debate (in Tribunal claims) about whether an employer’s behaviour during such negotiations has been “improper” or not.

TUPE changes

BIS has also announced a consultation about potential changes to the Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE”). The stated aim of the changes being consulted about is to simplify TUPE and deliver business growth. The most significant proposed change is likely to be the proposal to remove service provision changes as being TUPE transfers, which will mean potentially fewer transactions are covered by TUPE. However, there are several other proposals of interest including changes to consultation obligations, supply of employee liability information and changes to the provisions limiting changes to employee terms and conditions of employment.
It remains to be seen which of the proposed changes the Government decides to proceed with but it does seem that employers may feel that they have some more flexibility in dealing with the employment issues arising on business transfers than is currently the case. However, trades unions, particularly those in the public sector, are likely to raise strong objections to the Government’s proposals.

Employee sickness changes

Finally, the Department for Work and Pensions (“DWP”) has announced a consultation paper setting out the Government’s response to “Health at work – an independent review of sickness absences carried out by Dame Carol Black and David Frost CBE in 2011. The Government wishes to reduce the costs to UK businesses of employee absences but also to minimise the impact of long-term sickness on individuals. The key change being consulted about is the establishment of an independent health and work assessment advisory service, providing a State-funded occupational health service for employees who are off work sick for 4 weeks or more. This will be backed up with other changes including the provision of more information on GP fit notes, to assist employers with identifying alternative work they may be able to provide. If these changes are implemented they will, at the very least, mean that employers have to manage employee absences more pro-actively than they may do presently, although whilst that may mean more management time is incurred than presently, this change is not necessarily a bad thing.

We will be keeping up to speed with these consultations as they progress and will report on these in the coming weeks and months. We will also report on any other employment law changes of interest as when they happen.

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