Guide to the 2014 employment law changes

A number of changes to employment law took effect from 6 April and 30 June this year, another has been delayed until October. Some of these changes are helpful to employers but others will lead to increased costs.

ACAS early conciliation

From April, claimant employees will have to submit details of their dispute to ACAS before they can issue a claim in the employment tribunal. They will be offered early conciliation for a month, which can be extended by two weeks, and the time limit for presenting a claim will be extended. If conciliation is refused by either party or does not succeed, the employee will be able to present his or her claim. There is no obligation on either party to conciliate but it is hoped that ACAS will have a high success rate and that this free service will mean a number of potential employment claims are settled before tribunal proceedings are started, which will save employers time and money.

Discrimination questionnaires

Under the Equality Act, an employee or former employee who is considering bringing a discrimination claim can send his or her employer a list of questions to answer. The employer has eight weeks to reply. If the employer fails to respond or gives evasive or ambiguous answers, the tribunal can draw an inference that discrimination has occurred. On 6 April, this questionnaire procedure was abolished but employees are still able to ask questions and the answers, or lack of them, can be taken into account by the tribunal. ACAS has published guidance on how to deal with requests.

Changes in tribunal limits

Tribunal compensation limits rose on 6 April in line with inflation. The maximum compensatory award for unfair dismissal will be £76,574 (or 52 weeks’ pay if less). A week’s pay for calculating both the basic award for unfair dismissal and statutory redundancy payments will be £464 and the maximum basic award or statutory redundancy payment will be £13,920.

Financial penalties in the tribunal

Where there are aggravating features such as unreasonable behaviour, negligence or malice, tribunals have been given the power to impose a financial penalty on employers who lose at tribunal of 50 per cent of any award. The penalty can be between £100 and £5,000 and can be reduced by 50 per cent if the employer pays within 21 days. Genuine mistakes should not be penalised and tribunals are required to take account of the employer’s ability to pay.

Increase in statutory payments

The prescribed rates for statutory maternity, paternity and adoption pay increases to £138.18 per week. Statutory sick pay rises to £87.55 per week.

Statutory sick pay (SSP) record-keeping obligations

The SSP record-keeping obligations have been abolished and employers now have the flexibility to keep sickness absence records in a manner that best suits their own business needs. From April, employers are no longer able to reclaim SSP from HMRC.

Illegal migrants

The maximum penalty for employers who employ illegal migrant workers (workers who do not have the right to live or work in the UK) has doubled from £10,000 to £20,000. The government’s aim is to strengthen and simplify the regime to prevent illegal working.

Flexible working

The right to request flexible working is being extended to all employees with 26 or more weeks’ service. They will not need to be parents or carers in order to apply. Employers will not have to follow the current statutory procedure and will be able to use their own HR procedure instead, although they will have to deal with requests reasonably and respond within three months. This change came into effect on 30 June 2014.

Health and Work Service

A new Health and Work Service is being introduced, which will carry out state-funded occupational health assessments for employees who are off sick for four weeks or more. The aim is to get employees back to work more quickly. GPs or employers will be able to refer employees and the service will give advice to both employers and employees. If an employee fails to engage with the service, no further fit notes certifying sickness absence can be issued so employees will lose their SSP. This new service will be phased in gradually between October 2014 and April 2015.

Contact: David Hacker or Emma Thompson