Briefings
Employment: What to expect in 2008
In this first Briefing of 2008, we take a look at some of the legal developments that can be expected in the coming year.
Increase in compensation limits
The compensation limits on unfair dismissals and redundancy will again rise this year. For all dismissals occurring on or after 01 February 2008, the limits will be as follows:
- The maximum compensatory award that can be awarded for unfair dismissal will rise from £60,600 to £63,000
- The maximum limit on a week's pay, used to calculate basic awards for unfair dismissal and statutory redundancy payments, will increase from £310 to £330.
It is worth bearing in mind that the new limits will apply not only to dismissals that are notified on or after 01 February, but also to dismissals where the employee is given notice before 01 February and that notice expires on or after 01 February.
The Information and Consultation of Employees Regulations 2004
The Information and Consultation of Employees Regulations (the "ICE Regulations") are already in force for employers with 100 or more employees. However, with effect from 06 April 2008, they will be extended to apply to employers with 50 or more employees. This will significantly increase their reach.
An employer is not automatically obliged under the ICE Regulations to set up information and consultation arrangements. However, if 10% of employees make a valid request, the employer must negotiate with representatives of the employees to put in place an information and consultation agreement. This negotiation must take place within certain time limits and if no agreement can be reached, a standard default agreement will be imposed. If an employer already has an arrangement in place for information and consultation that satisfies certain minimum requirements, the threshold for a request from employees to negotiate a new agreement is higher, with a requirement that 40% of the workforce support a request.
Employers who are or will be covered by the ICE Regulations should consider whether:
- To be pro-active in negotiating a qualifying agreement with employees without a request (which would give the employer more control over the arrangements)
- To take a wait-and-see approach (which, if a valid request is made, would mean that the employer is under strict time limits and in the absence of a successfully negotiated agreement within those time limits, risks being forced into a standard default agreement which may not suit the business); or
- They are able to treat any existing arrangements as pre-existing agreements for the purposes of the legislation and if not, whether such arrangements can be modified in order to qualify.
Employment Bill
The Employment Bill, which was published in early December 2007, has now had its second reading in the House of Lords and will move on to Committee stage. Although it is expected that it will receive Royal Assent by summer 2008, the provisions relating to the repeal of the statutory dispute resolution procedures are unlikely to come into force before April 2009.
Corporate Manslaughter and Corporate Homicide Act
This Act, which will come into force on 06 April 2008, creates a new criminal offence of corporate manslaughter. The new offence will apply to organisations such as companies and partnerships and will have been committed where the way in which the organisation's activities are managed or organised:
- Causes a person's death and
- Amounts to a gross breach of a relevant duty of care owed to that person.
The emphasis is on a breach in the way in which the senior management managed or organised its activities.
The new offence is triable in the Crown Court by a jury. The penalty, if convicted, is an unlimited fine.
Amendments to the Sex Discrimination Act
Amendments to the Sex Discrimination Act 1975 were due to be made on 01 October 2007 but were delayed. The Government has now indicated that the amendments will be implemented by February 2008. As we have previously reported, the amendments were ordered by the High Court following a successful challenge by the Equal Opportunities Commission and will:
- Eliminate the requirement for a comparator in discrimination cases involving pregnancy and maternity leave
- Clarify women's rights in bringing such cases
- Amend the definition of harassment to facilitate claims which are not "on the grounds of sex" (but merely related to a person's sex) and claims relating to harassment by a third party.