Hello and welcome to our latest employment video. My name is Paul Griffin and I’m Head of the Norton Rose Fulbright Employment team in London.

In today’s video we’ll be looking at the key changes to employment law coming into force next month – the new rules on the conciliation of claims by Acas – and the imposition of financial penalties on employers found to have breached employment rights.

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And don’t forget to have a go at answering our quiz question at the end of the video for the chance to win a bottle of champagne.

Both of the changes covered in our video today are set out in the provisions of the Enterprise and Regulatory Reform Act 2013 - or the ERRA - which received Royal Assent last year. The relevant provisions are to come into force on the 6th of April and I’ll deal with each in turn.

Financial penalties for employers

Under current law, employment tribunals have the power to award various remedies to a successful claimant but have no power to penalise an employer for breach of employment laws. The government’s thinking behind the new provisions is to encourage employers to take steps to ensure that they meet their employment obligations and therefore reduce deliberate and repeated breaches of employment law.

When will a financial penalty be ordered?

The new provisions will apply to tribunal claims presented on or after the 6th of April 2014.

Where such claims are successful, the tribunal will have the discretion to order a penalty if the case has one or more “aggravating” features. This term isn’t defined in the new legislation but the Explanatory Notes to the ERRA state that it’s for the tribunal to decide, taking into account any factors which it considers relevant.

The Notes suggest that a tribunal may be more likely to conclude that there are aggravating features where the employer’s actions were deliberate or committed with malice – or where the employer is large enough to have a dedicated HR team or has repeatedly breached the employment right concerned.

On the other hand, the tribunal may be less likely to order a penalty where the employer has been in operation for only a short time, where the employer is a micro-business, has only a limited HR function or where the breach was a genuine mistake.

The general message seems to be that the more culpable the employer, the more likely they’ll be ordered to pay a penalty.

In exercising its discretion, the tribunal must also take into account the employer’s ability to pay. The Explanatory Notes suggest, for example, that where the employer’s business is in formal insolvency proceedings, it may be inappropriate to impose a penalty.

It remains to be seen how and when the tribunal will decide to exercise its discretion to order a penalty and how much weight will be given to each relevant factor. For example, will it be the case that small businesses with limited HR functions are rarely ordered to pay?

How much will the penalty be?

Where the tribunal does decide to impose a penalty, the ERRA states that the minimum amount ordered will be £100 and the maximum, £5,000.

Within these limits, where a financial award is made, the penalty should be equal to half the amount of the award. Where no financial award has been made – for example, where reinstatement has been ordered - the tribunal will be able to ascribe a monetary value on which to base any penalty.

If the employer pays within 21 days, he’ll only have to pay half the penalty.

Payment of the penalty will be made, not to the claimant, but to the Secretary of State.

Acas early conciliation of claims

The other change coming into effect in April is the new rules on the conciliation of claims by Acas.

As part of its plans to make the tribunal system more efficient and to avoid unnecessary tribunal proceedings, the Government decided to make it mandatory for a potential claimant to contact Acas before being able to present a claim.

The relevant provisions come into force on the 6th of April but will only apply to claims presented on after the 6th of May, so that there is sufficient time for the conciliation procedure. However, any voluntary requests to Acas for conciliation between the 6th of April and the 6th of May will be dealt with in accordance with the new rules.

Early conciliation procedure

In order to comply with the early conciliation - or EC procedure - the claimant firstly has to present a completed EC form to Acas. He can either submit this online on the Acas website, or post a hard copy to the address on the EC form.

Alternatively he can contact Acas by phone and the details provided will be transferred to the relevant form by Acas.

The form must contain both parties’ names, addresses and contact details - but doesn’t need to provide any details about the nature of the claim.

The Acas officer will then contact the parties and, for up to one month from receipt of the EC form, he must endeavour to promote a settlement between them.

Provided that the parties agree, this EC period may be extended for up to a maximum of 14 days where the Acas officer thinks that there’s a reasonable prospect of a settlement being reached.

If at any time during the EC period, the Acas officer decides that a settlement isn’t possible, or if settlement has not been reached by the end of the EC period, he’ll issue an EC certificate.

This certificate will contain a unique reference number which the claimant can then use on his ET1 to prove that he’s complied with the EC procedure when submitting his claim. In respect of the vast majority of proceedings, the claimant won’t be able to submit his claim unless he has an EC certificate.

Extension of time limit to issue proceedings

Most tribunal claims must be brought within 3 months of the breach of employment rights, whether that is the date of dismissal or a discriminatory act.

The new legislation provides that this time limit will be extended to take into account the EC procedure - so that the clock will stop from the date of receipt of the EC form by Acas until the date of receipt of the EC certificate by the claimant.

For example, if Acas receives the EC form one month after the claimant’s dismissal and the EC certificate is then received by the claimant two weeks later, he’ll still have two months from this date within which to submit his claim – giving him a total of 3 and a half months from the date of dismissal to bring his claim.

The new rules also provide that if there’s less than one month of the time limit left when the claimant receives the EC certificate from Acas, the time limit will be extended so that he’ll always have at least one month after receiving the EC certificate to bring his claim.

A prospective claimant who finds that the 3-month time limit is almost up, could take advantage of the new rules to extend time in this way. At the eleventh hour he need only phone Acas with a few details in order to stop the clock and give himself more time to prepare his claim if conciliation is unsuccessful.


This video is intended to give you a summary of the key employment changes coming into force in April, but if you would like any further information or have any questions on any aspects of today’s topic, then please don’t hesitate to contact us.

And, finally, our monthly competition. What is the location of the newly opened office of Norton Rose Fulbright? The first person to email me with the answer will receive a bottle of champagne.

Thank you.