UK: Changes In Sight For The Labor Law English: Good News For Employers?

Last Updated: 23 October 2011
Article by Claire Christy

The Government announced the increase of length of the minimum service required to sue for unfair dismissal and the introduction of a tax for labor courts.

The Government has announced a series of reforms of labor law, with the hope of obtaining a favorable opinion of the companies concerned by the ease with which they can be involved, in spite of themselves, and in litigation. The fear is that the current system is characterized by excessive costs and time-consuming, hampering economic development.

Two major announcements regarding the dismissal without just cause and the introduction of taxes for the use of labor courts.

Length of service necessary to appeal the dismissal without just cause

In general, a dismissed employee can sue if there was just cause for his dismissal or where it was not followed the proper procedure for dismissal. However, this right is restricted to the condition that the employee has at the conclusion of their employment accrued length of service required.

  • From 6 April 2012 , the length of service necessary to challenge the dismissal will increase from one to two years of continuous service.

The ultimate goal is to encourage companies to hire more people, reducing the risk that they will find themselves involved in costly litigation should it become necessary to dismiss an employee during his first two years of service.

The most skeptical observers have already expressed their reservations. The fear is that the new restrictions on the causes for dismissal without just cause may encourage employees to seek other types of cause to bring an alternative that does not have as a prerequisite for a certain length of service. We may therefore see an increase in other causes, such as those for discrimination (sex, age, disability, etc..).

Introduction of a tax system for access to employment tribunals

At the moment, it is surprisingly easy to challenge a dismissal without just cause and this can be done, both on the internet and on paper, at no cost (the amount of costs for a company forced to respond to a cause of dismissal is however a ' another story). Therefore, it may perhaps not surprising that last year the number of lawsuits in the courts of the work has reached the impressive share of 236,000. The ease with which a lawsuit can be initiated resulting in the fact that many of these are probably unfounded, if not unconscionable.

  • From April 2013 , those deemed to appeal a case before the Labour Court will have to pay taxes, which will be returned if the cause has a favorable outcome.

The details are still a few it would seem that the system will be introduced to a fixed tax. According to journalistic indiscretions, this could amount to GBP250 for the deposition of the case before the labor court and if it was fixed GBP1.000 hearing (however, taxes are very likely to cause more of a value exceeding GBP30.000).

However, the risk is that the introduction of a system of taxes does not necessarily discourage workers from more affluent sue large value. In addition, it would seem that those who wish to sue could benefit from exemption or reduction of fees if unemployed.

The Government will begin on the introduction of a tax consulting the social partners from November 2011.

As explained so far, these reforms are intended to ease the burden of litigation in the courts of work on farms. However, a reduction in the number of cases as a result of these reforms can never be a mathematical certainty.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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