Changes to the Employment Act

Article date: 09.04.09

* When the Employment Act 2008 came into force on 6 April 2009, it repealed the unpopular statutory dispute resolution procedures which caused so much uncertainty since they were introduced in 2004.

Its overarching goal was to sweep away unnecessary employment law in an effort to improve its effectiveness for employers, trade unions, individuals and the public sector. Some of the implications of this change are:

  • A procedural breach on the part of an employer will not automatically render a dismissal unfair.
  • Employees are longer be prevented from bringing a claim in the Employment Tribunal without having first raised a grievance with their employer.
  • Provisions giving Tribunals the power to raise or lower awards by up to 50% and to extend the time limits for bringing claims in some circumstances are removed.

Other changes introduced by the Act will include:

  • Employment Tribunals now have the power to increase or reduce awards by 25% where the relevant Code of Practice has not been followed.
  • ACAS’s duty to conciliate between disputing parties are extended past the previous fixed time period to cover the entire proceedings until a judgement is delivered.
  • In cases where failure to follow the correct procedure renders a dismissal automatically unfair, tribunals have the power to reduce or even eliminate the sum of compensation paid if the dismissal would have gone ahead anyway even if the procedure had been correctly followed.
  • Where all parties have given consent in writing or where the respondent has not replied to the claim, proceedings can be determined without a hearing.
  • In cases regarding unlawful deduction of wages or payouts, Tribunals now have the power to compensate employees for the full extent of the financial losses they have suffered as a result of not obtaining the original payment from their employer, including extras such as bank charges and interest.

Disciplinary and grievance disputes are now governed by a new ACAS Code of Practice. Tribunals are able to make adjustments of up to 25% to compensatory awards to reflect unreasonable failure to comply with the Code by either the employer or employee.

Employers should remember that they must still act fairly and follow appropriate procedures when dismissing an employee.  Employers should seek legal advice with regard to their responsibilities and what is likely to be regarded as fair by a Tribunal before dismissing an employee.

If you require further information on how the new act could impact on you or your business please contact us.

* This is not legal advice; it is intended to provide information of general interest about current legal issues.