Employment
tribunal changes will come into effect on Friday that will make it
easier for businesses to take on staff and improve the process
when staff have to be let go.
These changes are part of a radical reform package that will
ultimately deliver direct net savings to business of more than £10
million a year with wider benefits to employers estimated at more
than £40 million a year.
The Government has streamlined employment tribunals to cut
unnecessary demands on employers, and encourage growth, while
safeguarding workers’ rights. From 6 April:
The qualifying period for claiming unfair dismissal will rise
from one to two yearsJudges will be able to sit alone in unfair
dismissal casesWitness statements can be provided in writing as
opposed to the current rules where a witness reads their own
statement out aloudThe maximum level for costs awarded to
businesses winning a vexatious tribunal claim will rise from
£10,000 to £20,000. Deposit orders required by claimants when a
judge determines that a part of claim is unmerited will increase
from £500 to £1,000.
Also from Friday, we will publish the average value of awards and
time taken to reach a hearing. Included in the guidance for
tribunal application and response forms, this information will
provide all parties with a greater understanding about what to
expect from the tribunal process before they enter the system.
Business Secretary Vince Cable said:
“For too long now the system in place for employment
tribunals has been a bloated and bureaucratic obstacle for
employers and the taxpayer. For employers they were finding that
weak and vexatious cases were too much of the norm, too easy to
bring forward, while for the taxpayer they were proving ever more
expensive to run.
“We have seen claims drop in the last year and we want to see
this continue as we introduce alternative measures in the coming
months helping both parties resolve workplace disputes.”
The improvements to the tribunals system follow a steady
stream of announcements and initiatives to reduce the burden of
regulation on business.
The Budget on 20 March included commitments to scrap or
improve 84 per cent of health and safety regulation; as well as
introducing sector-based reviews to ensure that regulations are
enforced in a way that results in the lowest possible cost to business.
The One-in, One-out rule – the first of its kind anywhere in
the world – has begun to turn back the tide since it took effect
in January 2011. Any minister who wants to introduce a new rule
which generates costs for business must first identify a
corresponding cut in regulation elsewhere with the same value.
On 28 February the Third Statement of New Regulation, which
measures the success of the One-in, One-out rule, was published
showing that around £4 million of regulatory burdens will be cut
from British businesses between January and June 2012. It also
demonstrated that there has been cumulative net reduction of
regulation since January 2011.
Business and Enterprise Minister Mark Prisk said:
“The One-in, One-out process is one of the best tools we have
to cut the costs and burden of regulation on our businesses. But
we know that changing the culture of regulation in Whitehall is a
long-term job, and all of us in Government have to, and will,
continue to root out red tape which poses more of a hindrance than
a help to UK businesses.”
Notes to editors:
Most new laws affecting businesses come into force on one of two
common commencement dates (CCDs) each year - 6 April and 1
October. CCDs enable business to prepare for the introduction of
new, amended or reduced requirements. Read more about CCDs and the
changes due to be introduced here:
http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1075320304&type=ONEOFFPAGEThere
were 218,000 tribunal claims in 2010-11, a rise of 44% since
2008-09, with each business spending nearly £4,000 per claim on
average defending itself. There is an additional average cost of a
£1,900 to the taxpayer per claim.Previously, Employment Judges
were required to sit with lay members in all unfair dismissal
employment tribunal cases. Friday’s change means that such cases
will automatically be heard by a judge sitting alone unless they
consider that it is appropriate for the case to be heard by a full
panel, for example, where there are significant disputes as to the
facts of a case. In most other civil cases judges sit alone to
determine complex and extremely sensitive factual issues.Under the
previous rules, witnesses were generally required to read out the
statement they had prepared to the court. Having them taken as
read will help to increase the efficiency of the tribunal process;
hearing times will be reduced and more claims can be heard.BIS is
currently running the ‘Focus on Enforcement’ campaign which is
asking business to tell us where enforcement can be improved,
reduced or done differently and to discover and celebrate where it
works well, so others can learn from it. The first three reviews
were announced at Budget and will cover chemicals, small
businesses in food manufacturing and volunteer events. More
information is available at:
http://discuss.bis.gov.uk/focusonenforcementOne-in, One-Out (OIOO)
means that any new Whitehall regulation that imposes a net cost to
business must be offset by a reduction in regulatory costs
elsewhere. The Third Statement of New Regulation, which measures
the success of OIOO, can be found here:
http://www.bis.gov.uk/policies/bre/better-regulation-framework/one-in-one-out/statementBIS's
online newsroom contains the latest press notices, speeches, as
well as video and images for download. It also features an up to
date list of BIS press office contacts. See
http://www.bis.gov.uk/newsroom for more information.
Contacts:
NDS Enquiries
Phone: For enquiries please contact the issuing dept
ndsenquiries@co.gsi.gov.uk
Aidan Steer
Phone: 020 7215 5245
aidan.steer@bis.gsi.gov.uk