The Enterprise and Regulatory Reform Bill Changes

 Oh these times they are a changin’

The Enterprise and Regulatory Reform Bill, which is the Committee Stage of the House of Lords today (9January), will have far reaching implications for local business owners.

Managing Director of Vincents Employment Law arm Legal Earth, Christina Reed said: “It’s part of the Government’s Red Tape Challenge pushed through by business secretary Vince Cable and the bill is in its final stages of becoming new law.”

She added: “Business owners need to be ready for the changes which will have an enormous impact in the workplace in areas such as health and safety and breaches of employment rights.”

Here is the story so far:

• Compensatory award limit for unfair dismissal amended – An increase in the limit on the amount of the compensatory award for unfair dismissal giving the Secretary of State the power to alter the maximum award currently capped at £72,000.
• Employers Liability for Health and Safety – no more automatic liability for employers in cases for civil damages due to health and safety.
• Increases in unpaid parental leave - the right to unpaid parental leave increases from 13 weeks to 18 weeks from 8 March 2013.
• Shareholder agreements with employees: a new style contract will allow businesses to give employees shares in exchange for them forfeiting some of their employment rights.
• New name for Compromise Agreements – settlements to terminate an employee’s contract by way of a payment made in a Compromise Agreement will be renamed settlement agreements.
• Portable DBS checks: Disclosure and Barring Service (DBS) checks (formerly Criminal Records Bureau checks) are portable between employers from March 2013.
• Payroll amendments – From the 6 April 2013, businesses will have to use real-time information to report payroll deductions before or when they make them.
• Rapid Resolution Scheme – With agreement from the parties, legal officer can decide as to whether specific employment tribunal claims should be settled quickly and cheaply out of court.
• Fines for breaches of employment rights – If a breach of an employment right has one or more ‘aggravating features’ such as with malice or repeated breaches, then the tribunal has the power to fine the employer. The minimum penalty will be £100 and the maximum £5,000 with an in-built 50% reduction if they pay the penalty within 21 days.
• Third-party harassment – The business owner is no longer liable when an individual is harassed by a third party. This is in line with the Equality Act 2010.
• Secrecy regarding termination offers – Negotiations surrounding offers between an employer and employee regarding the termination of employment on agreed terms will be protected and cannot be used at a subsequent unfair dismissal hearing in an Employment Tribunal.
• Sole judges for appeal cases – Cases before the Employment Appeal Tribunal can be heard by a judge sitting alone.
• Protection for whistle-blowing – An employee will forfeit protection for disclosure unless he reasonably believes that the disclosure is made in the public interest.
• Collective redundancy consultation time reduced – employers from 6 April 2013 will need to carry out 45 as opposed to the current 90 days consultation for redundancies over 100 employees.
• Increases in statutory maternity, maternity and adoption pay - from April 2013.
• Discrimination cases amended – The employee will no longer be able to collect information from the employer prior to lodging a claim and use this information at a tribunal hearing, with the exception of an equal pay audit, where the allegation is that the employer has breached equal pay provisions under the Equality Act.
• Claimant fees to lodge a tribunal claim – Claimants will have to pay to issue a claim at an Employment Tribunal and may incur further fees if the matter progresses to a hearing.
• Shareholders given binding votes on pay policy – Increased powers for shareholders to approve directors’ exit payments, pay and expenses.
• Bankruptcy simplified – Businesses will not be bound to use court procedures.
• Statutory sick pay uplift – the rate of statutory sick pay increase from April 2013.