Reducing red tape or increasing distrust – simplification of employment law

From April this year, key changes will be made to employment law which on the surface are designed to make matters easier for employers and to reduce costs. Are we witnessing over simplification and building up issues for ourselves?  Let us examines some of the issues.

Reduced Use of Lay Members In Unfair Dismissal Cases

Employment Judges already sit alone in some cases – primarily in claims of unlawful pay deductions, disputes on redundancy payments and unpaid holiday pay. From 6th April, Judges may sit alone in unfair dismissal cases. That may have the advantage of simplifying the scheduling of hearings as one person, rather than three, is required but that will depend on a sufficient number of judges being available in the local tribunals. Costs are also likely to be reduced through the saving of members’ fees and expenses. However employers are likely to have to work harder to ensure the key facts of their case and standard practices are taken into account by the judge sitting alone.

Originally, Tribunals were composed of lay members and a professional lawyer so that the lay members could draw upon their commercial experience whether in management or trade union representation to ensure that industrial practices were taken into account. They would form opinions as to whether an employer had adopted reasonable practices or was just trying to hoodwink the tribunal. Similarly, the members would identify situations in which the employee had stepped over the line or was not prepared to recognise standard practices.

That background will be lost as an advantage to employers. The latter will have to plan and present cases in a way that highlights the importance of industry practices and norms as the Judge will not be informed of those from lay members in the future. In practice this is likely to mean extra work for employers to ensure that:

  • witness statements bring out any key practices that are in dispute or fundamemtal to demonstrating the reasonableness of the employer’s expectations.
  • questioning of witnesses will explain the importance of such practices and norms within an industry or organisation
  • links between contractual terms or agreements and the facts are explained and that assumptions are not made that a judge would ‘know’ that.

It will remain to be seen whether the cost saving of this change is of advantage to employers in view of the issues above.

It also remains to be seen whether this change leads to further legal technicalities in tribunal cases. The original hope of tribunals was for a simpler non technical approach to determining claims. However, legal representation has grown and so has the complexity of presenting cases as many cases are argued on minutiae. Tribunal judges themselves have complained about the over formality of tribunal proceedings as lawyers have sought to move in on this source of revenue.

Reducing Employment Law Rights

Another change is that employees will require 2 years continuous service to request written reasons for dismissal or claim unfair dismissal. Surely manager are able to assess whether an employee is going to be satisfactory within 12 months. Increasing the service requirement to two years is likely to lead some employers using the two year period as a means of avoiding employment rights. Employees will be terminated before acquiring the two years service during which time the employer has gained some stability but the employee is denied any recourse by a hire and fire practice.

In contrast many employers will be more balanced in their approach and not use the higher qualifying period as a ruse to avoid the law.

Even if the two year qualifying period was necessary to help SMEs to feel more confident in employing new staff, it would have been better to have left the service requirement for obtaining written reasons for dismissal at one year. Employers should be prepared to state the reasons for dismissal as that helps employees in moving on. It also helps individuals to know that their dismissal was due to financial issues rather than their own performance or conducts – written reasons would give then that extra confidence as they begin their search for another job.

Let us not pander to the groans of the few as there are many responsible employers. A better use of legal amendments would be to simplify some of the complex areas of law in discrimination, transfers and help all employers go about their business without fear of claims generated by the complexity and minefields in these areas.

© 2012 HR Management Dimensions Ltd

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