Summer is coming – time for eating ice-cream and sunbathing. Alright, perhaps not if last summer was anything to go by. So is there anything to look forward to this Summer? Well, there are no Olympic Games, but we can look forward to changes in Employment Law! (precise dates yet to be confirmed).
Pre-termination negotiations allow employers to make settlement offers to employees without the negotiations being referred to or relied upon in unfair dismissal proceedings, which could be used to have an honest, open conversation with employees about their performance. However, such conversations could still be referred to in discrimination, automatically unfair dismissal or breach of contract cases, and where the employer behaves 'improperly'. ACAS will issue a Statutory Code of Practice about making such offers and what constitutes 'improper behaviour'.
The Emperor's New Clothes
If employees agree to leave during pre-termination negotiations they will no longer sign compromise agreements – these will be renamed "settlement agreements". However the requirement for employees to receive independent legal advice before signing will continue.
Pay to Play
Claimants will also have to pay both an issue fee and a hearing fee to get their claim heard. For level one claims (e.g. simple claims for unpaid wages), the issue fee is £160 and the hearing fee is £230. For level two claims (more complex claims e.g. unfair dismissal or discrimination), the issue fee is £250 and the hearing fee is £950. This will hopefully deter weak claims from being brought. However it will be means tested, based on the claimant's income and benefits at the time of lodging the claim. Accordingly many ex-employees who have lost their jobs may only have to pay a reduced fee.
Show Me the Money
Finally, the Compensatory Award for unfair dismissal will be capped at either 12 months gross pay or the current statutory maximum of £74,200 – whichever is the lower figure. This should lower employee expectations about the amount of compensation they are likely to receive, encouraging them to settle for a more 'sensible' figure.
So, pop-up that deckchair, relax in the sunshine…but ensure your employment lawyer is not far away, just in case!!