The Employment Bill - managing difficult and sensitive issues

By Diane Gilhooley

February 7, 2008

The Government recently published the Employment Bill, which will, among other things, repeal the statutory dispute resolution procedures. Those procedures currently form the basis for managing serious grievances and dismissals for employers. The Bill, which will eventually be known as the Employment Act 2008, received its first reading in the House of Lords in early December 2007 and its second reading on 8 January 2008.

Abolition of statutory disciplinary and grievance procedures

In March last year, the Gibbons review recommended that the Government should repeal the statutory dispute resolution procedures; it also made a number of other significant recommendations to improve dispute resolution in the workplace. In response, the Government issued a consultation paper setting out its proposed reforms and new measures.

Having collated the responses to that consultation, the Government issued the Employment Bill, the first part of which deals with dispute resolution. The Government’s consultation response is still, however, unavailable.

As expected, the Bill repeals the existing statutory dispute resolution procedures and related provisions about procedural unfairness in dismissal cases. In place of them, employers and employees alike will be expected to comply with codes of practice for resolving disputes developed by the Advisory, Conciliation and Arbitration Service (Acas). If either party unreasonably fails to follow the codes of practice, employment tribunals will be able to increase or reduce compensation by up to 25 per cent, depending on who was at fault. How onerous this requirement will be to education institutions remains to be seen, as it is likely that the current Acas Code of Practice on Discipline and Grievance will be amended.

In addition, the Bill introduces a new fast-track procedure for settling monetary disputes. Cases determined within this system will be decided without a hearing, provided that both parties agree.

Further proposed amendments make changes to the law relating to conciliation by Acas. The amendments allow Acas to prioritise cases where demand for conciliation exceeds resources available for conciliation, and to relieve them of an obligation to conciliate where there is no prospect of success. The fixed periods for conciliation are also removed.

The proposed changes also allow tribunals to award compensation for financial loss following certain types of monetary claim, such as unlawful deduction from wages or non-payment of redundancy pay. This envisages that, in appropriate circumstances, bank charges or interest payments may be recoverable, so increasing the potential damages payable in this type of claim.

What happens next?

The Bill will now move to the Committee stage. Before it can become law, the Bill will be debated in Parliament and may well be amended. The passage through Parliament can be a protracted process. So, even though the principles underpinning the Bill may not be contentious, it could be some time before the Bill is enacted, and it may not be enacted in its current form.

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