UK Employment Law Developments

At A Glance

Various legislative changes are proposed or will be occurring in several areas of importance to UK employers, and an important new employment law case with international implications will affect employers during certain business transfers.

  1. Legislation

    1.1 Employment Bill: Repeal Of Statutory Dismissal And Grievance Procedures Confirmed

    The Employment Bill (Session 2007?08) (the "Bill") is now working its way through the UK Parliament. It is likely to be passed this summer but most of its provisions will come into force at a later date, some via secondary legislation. The Government has not yet confirmed a date, but it is anticipated that some provisions may come into force as early as April 2009. The Bill changes UK employment law in various ways. The major changes for employers are:

    Repealing the much-criticised UK statutory dismissal and grievance procedures. The government-appointed Gibbons Review was tasked with reviewing them and proposing a better alternative (as covered in our Stay Currents of February and April 2007).

    Giving Employment Tribunals discretion to increase or decrease compensation awards by up to 25% if either employer or employee unreasonably fails to comply with a statutory Code of Practice. The most obvious applicable Code is the Advisory, Conciliation and Arbitration Service ("ACAS") Code of Practice on Disciplinary and Grievance Procedures.

    Extending ACAS' powers of conciliation and removing the fixed conciliation periods that currently apply in Employment Tribunal claims

    Changing the methods of enforcing the national minimum wage and calculating arrears.

    Amending UK law so that trade unions can exclude current or former members of particular political parties from membership. This change is necessary to comply with the European Court of Human Rights case Aslef v UK (Application no. 11002/05).

    The Bill only partially details the new employment dispute resolution regime. However, it appears to be similar to the pre-2004 regime in place before the introduction of the statutory dismissal and grievance procedures. Further details should be forthcoming later this year.

    The Bill, with explanatory notes, can be accessed at: http://services.parliament.uk/bills/2007-08/employment.html

    1.2 Pensions Bill: Further Reforms Affecting Employers

    In 2006, the UK Government put forward plans to reform the pension system in the UK, by (i) improving state pensions, and, (ii) encouraging individuals to improve their private pension provision.

    The Pensions Act 2007 (in force from 26 July 2007) reformed pensions by:

    Reducing the qualifying period for the basic state pension, and basing annual increases on earnings, not price, increases.

    Increasing state pension age for men and women to 68 by 2046.

    Reforming...

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