Growth and Infrastructure Act 2013 and the Enterprise and Regulatory Reform Act 2013

The government has passed two major pieces of legislation, the Growth and Infrastructure Act 2013 and the Enterprise and Regulatory Reform Act 2013, each of which have considerable impact on employers. The changes are expected to come into force, at various intervals, over the next twelve months. They include:-

• introducing compulsory conciliation via Acas before an employee can start an employment tribunal claim. The parties cannot be forced to participate in the conciliation, but unless the employee has contacted Acas and asked to conciliate, they won't be allowed to bring a claim.
• introducing fees to start an employment tribunal claim. For all but the smallest claims, it will cost £250 to start the claim, with a further £950 payable by the employee when a hearing date is set. Beware - any employer who loses will probably be ordered to refund those fees as well as pay compensation.
• penalties of up to £5,000 for employers who have breached employment rights, where there are aggravating factors (halved if paid within 21 days).
• creating a new category of worker, known as 'employee shareholders'. In exchange for giving at least £2,000-worth of shares to the employee, a company can require prospective employees to give up some employment rights (including the right to claim most types of unfair dismissal, and the right to a redundancy payment). With various limitations, existing employees can also be asked to become employee shareholders.
• bringing down the cap on the compensatory award for unfair dismissal - either limiting such awards to one year's salary for the employee, or to the current limit of £74,200. This is likely to be reviewed again in the future.
• introducing confidential pre-termination discussions, enabling employers and employees to have frank discussions about ending employment without fear of being held to account by a tribunal.
• various changes to whistleblowing legislation, in general making it harder for employees to claim, but removing the rule that the whistleblower must make their disclosure in good faith.

We'll cover these in more detail in forthcoming bulletins, as and when they come into force.