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News & Blog

Employment Law Newsletter – April 2012

Welcome to April’s edition of our employment law newsletter, keeping you up to date with forthcoming changes to legislation and case developments.

Highlights of the changes coming into force in April 2012 are as follows:

Unfair dismissal

The qualifying period for unfair dismissal will increase from one to two years. This will only affect employees whose employment starts on or after 6 April 2012.

Employment tribunal procedure

  • Deposit orders. The maximum deposit a tribunal will be able to order a party to pay if their claim has little reasonable prospect of success will increase from £500 to £1,000. The change will affect all cases presented on or after 6 April 2012.
  • Costs awards. The maximum amount of costs an employment tribunal can award (without referring the case to the county court for detailed assessment) will increase from £10,000 to £20,000. The change will affect all cases presented on or after 6 April 2012.
  • Witness statements. Where witness statements are used, they will stand as evidence in chief and be taken ‘as read’ at the hearing, unless a judge or tribunal directs otherwise. This applies to all cases presented on or after 6 April 2012.
  • Witness expenses. State funded witness expenses are to be withdrawn. Tribunals will have the power to direct parties to bear the expenses of any witness. The government will withdraw state-funded expenses. The new power will affect claims presented on or after 6 April 2012.
  • Judges to sit alone on unfair dismissal cases. Unfair dismissal cases will be heard by a judge sitting alone without lay members, unless the judge orders otherwise. This will affect all cases heard on or after 6 April 2012. The government have said that progress on this change will be reviewed after a year.

Statutory payment rates

From April 2012, the standard weekly rates will increase for the following payments:

  • Statutory maternity pay, statutory paternity pay and statutory adoption pay: these will increase on 1 April 2012 from £128.73 to £135.45 and the weekly earnings threshold will rise from £102 to £107.
  • Statutory sick pay: this will increase on 6 April 2012 from £81.60 to £85.85, while the weekly earnings threshold will rise from £102 to £107.
  • Maternity allowance: this will increase on 9 April 2012 from £128.73 to £135.45.

Other proposed changes for the future include:

National minimum wage rates from October 2012

The government has announced the following national minimum wage rates, which will take effect from 1 October 2012:

  • The standard adult rate (workers aged 21 and over) will rise to £6.19 per hour (up 1.8% from £6.08).
  • The development rate (workers aged between 18 and 20) will remain at £4.98 per hour.
  • The young workers rate (workers aged under 18 but above the compulsory school age who are not apprentices) will remain at £3.68 per hour.
  • The rate for apprentices will rise to £2.65 per hour (up 1.9% from £2.60).
  • The accommodation offset will rise to £4.82 per day (up 1.9% from £4.73).

BIS calls for evidence on “compensated no-fault dismissal”

BIS has issued a call for evidence seeking views on two measures to address concerns that dismissal procedures can be too onerous, particularly for smaller businesses:

  • Dismissal processes. Views are sought on whether the Acas Code of Practice on Disciplinary and Grievance Procedures could be made more accessible and easier to use by smaller businesses. The Australian Small Business Fair Dismissal Code is suggested as an alternative that might be successfully applied in the UK.
  • Compensated no-fault dismissals for micro businesses (with fewer than ten staff). If implemented, compensation for a no-fault dismissal would only prevent an employee from bringing an unfair dismissal claim, not any other type of claim arising out of their dismissal.

The call for evidence closes on 8 June 2012. 

CASE DEVELOPMENTS IN MARCH

 Highlights of recent court and tribunal decisions include the following: 

Redundancy dismissal to avoid pension liability justified on particular facts

In Woodcock v Cumbria Primary Care Trust [2012] the Court of Appeal has upheld a tribunal’s decision that an NHS Trust’s dismissal of a redundant chief executive without proper consultation to avoid his qualification for an enhanced pension was not unlawful age discrimination because the treatment was justified. While the court accepted that an employer could not justify treatment solely because the elimination of that treatment would involve increased costs, on the “unusual” facts of the case, the chief executive’s dismissal could not be characterised as having been solely aimed at saving or avoiding costs. The dismissal had been a proportionate means of achieving the legitimate aim of effecting the chief executive’s redundancy and was justified.

TUPE: change in location was substantial change to employees’ material detriment

In Abellio London Lts v Musse the EAT has upheld a tribunal’s decision that a relocation of six miles because of a TUPE transfer was a substantial change in bus drivers’ working conditions to their material detriment. Therefore, they had been entitled to resign and claim that they had been dismissed for the purposes of regulation 4(9) of TUPE. In London, a move from north to south of the river was substantial, and an increase in the working day of between one to two hours was a material detriment.

Redundancy: selection pool of one was fair

The EAT has upheld a tribunal’s decision that it was not unfair for an employer to use a selection pool of just one employee where it was ceasing its operations in China and the claimant was the only employee who had been sent to China. Decisions as to pools and selection criteria are matters for the employer, and a tribunal should rarely interfere with them. However please follow this decision with care and only use a selection pool of one when you are sure it can be justified.

If you require any further clarification in relation to the above developments, or if you need any other assistance then please do not hesitate to contact our team of specialist employment solicitors on 0161 832 3304: 

Shiva Shadi                      Partner

Anna Bunting                    Partner

Claire Smith                     Associate Solicitor

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