Stripping away job protections
Yesterday, the government announced its latest proposals aimed at stripping away basic workplace rights. Included in the announcement was the confirmation that two significant changes to unfair dismissal rules are expected to come into effect at the end of this month (on 29 July). The plans will make it cheaper and easier for employers to sack staff.
Only last summer the government decided not to implement the Beecroft proposals for no-fault dismissal. However, they now appear intent on implementing his recommendations by the back door.
Firstly, the government plans to reduce the limit on the compensatory awards paid to individuals who have been unfairly dismissed, a move which effectively punishes the victims of ill-treatment at work at the same time as letting bad employers off the hook.
The government’s proposals will mean that many individuals who are unlawfully sacked will no longer be properly compensated for loss of future earnings and pension entitlements.
The maximum compensatory award an individual will receive will be 52 times their weekly earnings. This will mean low paid employees or those working part-time will inevitably lose out. For example, the maximum compensatory award that a part-time women worker (working 16 hours a week at NMW rates) could receive would be just over £5,150; whilst top earners could be awarded up to £72,400. Older workers who are more likely to have accrued better pensions and are less likely to be able to find a new job will also be seriously disadvantaged.
Secondly, new rules making it easier for employers to use settlement agreements (formerly compromise agreements) to end an individual’s employment will also come into effect in late July. Employers will be free, at any stage, to offer an individual a sum of money in return for their agreeing to leave their job. The offer and any conversations will remain confidential and cannot be used in a future unfair dismissal claim, unless an employment tribunal decides that the employer behaved improperly, for example by discriminating against the individual.
Employees will have a theoretical right to turn the offer down and stay in their job. However, in reality, many – especially those who don’t have access to trade union advice or representation – will feel forced to accept the offer for fear of being victimised or bullied at work if they don’t.
These proposals will make it easier for employers to sack individuals for arbitrary reasons and without following a fair procedure.
And if this was not enough, these changes will be introduced on the same day as employment tribunal fees. From 29 July, an individual bringing a claim for unfair dismissal could be forced to pay up to £1,200 in fees for their case to be decided by an employment tribunal.
It’s another demonstration that the coalition government is intent on stripping away employment protections, restricting access to justice and limiting employees’ ability to challenge mistreatment in the workplace.