Vince Cable’s proposed changes to employment law don’t have to be seen as just for the benefit of employers, argues employment lawyer James Wilders
Tribunals can be a costly business for companies. Now Vince Cable’s come up with a list of reforms which he calls the “biggest reform of employment law in decades”.
The unions have alleged Cable’s measures are very anti-employee, but in actual fact the proposals ought to strike a chord with both sides of the fence.
So what exactly is the business secretary proposing and how will it affect both employers and employees?
Under government plans announced yesterday, the period of service required before an employee can issue an unfair dismissal claim would rise from one to two years, and fees for filing a claim would be introduced.
As part of the proposals, employers will take part in “protected conversations” with employees without it later being held against them. The protected conversation would allow both parties to speak frankly and openly about issues like retirement and poor performance, before the issue escalates to the tribunal. Currently employers are often wary about discussing these issues with their employees for fear of either the conversation being misconstrued or of undermining any later procedure.
The idea of protected conversations is novel and refreshing but whether it will work or not depends on how it will be implemented. For example, the government will need to clarify whether the employee would have to agree to having a protected conversation, in which case this might not represent so much of a leap forward as employers would like.
Cable also proposes to reduce the time for consulting on large scale redundancies from 90 days to 30 days. The current requirement to consult for 90 days only applies to a situation in which more than 100 redundancies are expected, so reducing the time period to 30 days could represent a fairer and more realistic way of dealing with redundancies for both the employer and employee. For example, consultations with unions are unlikely ever to result in an employer changing their mind and deciding not to make redundancies. And once redundancies are announced, employees usually want to conclude the process quickly rather than having it hang over them.
Another element to his proposal is a requirement for all claims be referred to ACAS before going to an Employment Tribunal. This could only ever work if ACAS were properly resourced. ACAS already has a statutory function to mediate in tribunal cases, which can be very helpful in resolving disputes, particularly where the employee is representing himself, but it is currently spread very thin, with an increased workload and reduced resources. Questions must therefore be asked of government about how it proposes to fund this, which in turn will dictate what impact, if any, this element of their proposal might have since neither a claimant nor employer can be forced to negotiate.
Finally, Cable wants to introduce a “rapid resolution scheme” so that simple tribunal cases can be dealt with inside three months. This is a practical idea for resolving straight forward cases. However, it would only work if both sides still get a fair hearing – justice should not be allowed to suffer just for the sake of churning cases through the system more quickly.
Following yesterday’s announcement, employment lawyers will all be looking forward with great interest to see how the government plans to put their proposals into practice. As is all too often the case with employment law, however, the devil will be in the detail.
James Wilders is an employment partner at law firm Dickinson Dees.
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