The Government’s response to its ‘Resolving Workplace Disputes’ consultation provides further detail of its reasoning in relation to already announced decisions such as the increase in qualifying period for unfair dismissal claims. The response also contains a number of reforms not announced in Vince Cable’s speech to the EEF, such as plans to allow employment judges to sit alone in unfair dismissal cases, judges to sit alone in the Employment Appeals Tribunal and to allow tribunals to award costs of up to £20,000 against vexatious claimants. Where possible, the Government intends to implement the changes in April 2012.
The increase in the qualifying period for unfair dismissal is one of the most controversial employment law decisions yet announced by the Government. In their response the Government explains that, although the majority of consultation respondents disagreed with the proposal, it considered that business stakeholders, who were supportive of the move, were best placed to evaluate its likely impact on job creation. Although the Government accepted that an increased qualifying period would not reduce the number of claims by as much as it had originally forecast, it did not think it would lead to an increase in discrimination claims, as there is little evidence that, where there are grounds for a discrimination claim, individuals currently choose to pursue an unfair dismissal claim instead. The Government rejected only increasing the qualifying period for small businesses on the basis that ‘there does not appear to be strong evidence that small businesses are disproportionately affected by unfair dismissal rules’.
The response also indicates that, at the earliest opportunity, the Government will allow employment judges to hear unfair dismissal cases alone, unless they direct otherwise. The proposal has been adopted, despite a negative consultation response, so as to ensure maximum value for money to taxpayers. The Government will use pending academic research on the value of lay members to evaluate the first year of judges sitting alone in more cases, to see whether a reversal or extension of the policy is necessary.
The Government also intends to allow tribunals to levy financial penalties, payable to the Exchequer, on employers found to have breached employment rights where the employer’s behaviour in committing the breach had ‘aggravating features’. The Government expects penalties will be imposed where the breach involves unreasonable behaviour, e.g. negligence or malice. The financial penalty will be half the amount of the total award with a minimum threshold of £100 and an upper ceiling of £5,000. Where a non-financial award has been made, a tribunal can ascribe it a monetary value to enable a financial penalty to be made. The penalty will be reduced if there is prompt payment, by 50 per cent if paid within 21 days.
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