Dismissal Process ‘Call for Evidence’Monday, March 19th, 2012
During its term in office, The Coalition Government is already conducting a review of employment laws and regulations that may prevent an employer taking on new employees. This was detailed in our news item on 26 November 2011 as a result of Business Secretary Vince Cable’s speech to the Engineering Employers’ Federation on 23 November 2011.
On 15 March 2012, as part of this Parliament-long process, the Department for Business Innovation and Skills published a ‘Call for Evidence’ document looking at proposals to examine the current dismissal process. This review was suggested by stakeholders who perceived that ‘dismissal procedures can be too onerous, particularly for smaller businesses’. The Call seeks to gather evidence from interested parties, including businesses and employee representative groups, on two topics:
The Dismissal Process
Whilst not underpinned in legislation, the current dismissal process generally follows the ACAS ‘Code of Practice on Discipline and Grievance’, which the Employment Appeals Tribunal is required to take into account in any hearings. However, research by BIS has found that the procedures contained and the language used may not be practicable for small businesses and that it was, perhaps, ‘backward-looking’ at disciplinary issues rather than ‘forward-looking’ for improving capability and performance.
The Call asks for comments about the ACAS Code plus also seeks views on whether the Australian ‘Small Business Fair Dismissal Code’ could be a suitable alternative for theUK. This Australian Code applies a checklist which the small employer can complete to help them decide whether a dismissal is fair. They are further advised to keep this checklist as a defence against possible claims for unfair dismissal in the future.
‘Compensated No-Fault Dismissals’
As a result of a proposal to come out of the Government’s Red Tape Challenge, the Call asks for views on the concept of Compensated No-Fault Dismissals. This would apply to micro businesses, i.e. those with less than 10 employees. The concept would allow businesses to dismiss an employee who is not at fault, as long as an amount of compensation was paid. The employer would not be required to go through a formal dismissal process under this concept and employees would not be able to bring an Employment Tribunal claim for unfair dismissal at a later date. As now, however, the employer would still have the right to dismiss an employee without compensation if there was fair reason for the dismissal. Likewise, the employee would still have the right to make a claim to a Tribunal if the dismissal was unfair (discrimination, whistle-blowing, asserting the right to be paid at the Minimum Wage etc).
The Call does acknowledge that the concept of Compensated No-Fault Dismissals would not give ‘complete peace of mind to an employer’.
The consultation closes on 08 June 2012, and all parties with a vested interest are encouraged to participate in these wide-ranging proposals
- Payroll Help – Employment Law Reforms 26 November 2011
- BIS – Dealing with Dismissal and ‘Compensated No-Fault Dismissal’ for Small Business Call for Evidence
- ACAS – Disciplinary and Grievance Procedures
- Fairwork – Small Business Fair Dismissal Code