Employment Law: What to expect in 2012

Employment law is a rapidly changing area.  This year alone, we have seen radical reforms to the rights of agency workers, the abolition of the default retirement age, and the Bribery Act 2010 come into effect.

The pace of change shows no sign of slowing, as we look ahead to 2012.  In April, the qualifying period for unfair dismissal claims will rise from one to two years.  Employers will be able to dismiss employees with fewer than two years' service without giving a fair reason, although they will need to be careful to avoid any claim of discrimination, which will stay open to all employees. It remains to be seen whether there will be any transitional provisions to protect those employees who currently qualify, but would not from April next year.  

From October, employers will be obliged to automatically enrol eligible employees in a pension scheme and contribute to that pension. Pensions auto-enrolment will be implemented in stages over a four-year period, meaning, in the first month, only the largest employers (with more than 120,000 employees) will be affected.  Employers should check now at what point they will be obliged to comply with the new duties and assess the likely costs of doing so.

These are just a couple of the major reforms we already know about.  It is likely that more changes will be announced over the coming months.  For example, a consultation will be taking place on the introduction of fees for bringing employment tribunal claims.  The level of these fees will clearly determine how effective they are in reducing claims.  The Government has also confirmed that it is seeking opinions on the introduction of compensated, no-fault dismissals for small businesses with 10 or fewer employees.  If implemented, dismissed employees would be paid a fixed sum, based on a statutory formula, rather than being able to challenge the fairness of their dismissal in an Employment Tribunal.

In these times of change, it is more important than ever for employers to keep their practices and policies under review, and to take legal advice where they are unsure about the practical impact of any new legislation.

Ashfords LLP is regulated by the Solicitors Regulation Authority. The information in this note is intended to be general information about English law only and not comprehensive. It is not to be relied on as legal advice nor as an alternative to taking professional advice relating to specific circumstances.