Key takeaways
- Mandatory written reasons for dismissal: New day one employment right for employees to be provided with the written reasons for their dismissal within seven days of their employment ending.
- Increase to discrimination awards: The maximum compensation for discrimination claims will be significantly increased to the lesser of £30,000 or 52 weeks' pay per complaint.
- Enhanced compensation for unfair dismissal: Tribunal may now have regard to employer conduct when making an award for unfair dismissal – awards can be increased up to 25% if the Tribunal considers employer conduct to have been unreasonable.
- New bands for unfair dismissal: Two new compensation bands for employees with long service to be introduced, namely 31 weeks' pay for between 10 and 15 years' service and 36 weeks' pay for 15 plus years' service.
- General increase to compensation: Compensation for breaches of a range of statutory employment claims to be increased up to a maximum of eight weeks' pay.
Introduction
The proposed amendments to the Employment (Jersey) Law 2003 and the Discrimination (Jersey) Law 2013 will bring significant changes to Jersey's employment law regime. These changes, which were adopted by the States on 22 April 2025, are being introduced with the aim of enhancing employee rights and ensuring fair treatment in the workplace.
This article provides an overview of the key changes, including the new requirements for dismissal procedures, the increases to compensation awards for discrimination claims and the consideration of the reasonableness of employer conduct in unfair dismissal claims. Given the extensive and potentially punitive nature of these proposals, understanding the effect of the new provisions will be essential for minimising legal risk to employers and their businesses.
Mandatory written reasons for dismissal
One of the most notable of the proposed changes is the requirement for employers to provide employees with written reasons for their dismissal. This new provision will require employers to give employees a written statement setting out why they have been dismissed within seven days of their termination date. This requirement will be a day one employment right, applicable to all employees regardless of their length of service. Further, and in contrast to the UK where an employee has to request written reasons themselves, Jersey employers must provide reasons for an employee's dismissal whether the employee has made a request or not.
This change aims to promote transparency and fairness in the dismissal process, ensuring that employees are fully informed of the reasons for their termination. However, the financial implications for failure to comply with the requirement to provide written reasons for dismissal could be significant for employers. If the Tribunal determines that the employer had no reasonable excuse for failing to provide written reasons, an award of up to eight weeks' pay can be made to the affected employee. In addition, the Tribunal may still require the employer to provide the written reasons for dismissal.
If written reasons for dismissal are not provided, employers could also expose themselves to potential unfair dismissal or discrimination claims in failing to follow the correct procedure. To mitigate this risk, it is therefore advisable for employers to update their exit processes and leaver letters to ensure that they include the provision of written reasons for dismissal within the required timeframe.
Increased discrimination awards
The proposed amendments will also considerably increase the compensation that can be awarded for a successful discrimination claim. As part of the changes, the maximum compensation for financial loss and hurt and distress will be the lesser of £30,000 or 52 weeks' pay per complaint. Although, the total compensation for either financial loss and hurt or distress cannot exceed the lesser of £30,000 or 52 weeks' pay, an important point to note is that this increase is applicable to each standalone discrimination complaint. On this basis, if an employee were to successfully bring three separate discrimination claims, for example, an employer would be exposed to potentially having to pay up to three times the lesser of £30,000 or 52 weeks' pay.
It is also worth noting that within this overall cap the bracket for injury to feelings, which include "subjective feelings of upset, frustration, worry, anxiety, mental distress, fear, grief, anguish, humiliation, unhappiness, stress and depression", has been increased from £5,000 per complaint to £30,000 per complaint. Previously, the brackets were up to £1,500 for a one off or low-level act of discrimination, £1,500 - £4,000 for mid-level acts, and £4,000 - £5,000 for a serious/deliberate act or a long course of conduct. Unless the Jersey Employment and Discrimination Tribunal issues revised guidance updating the brackets, we will need to wait for the first case under the new remedies regime to be determined before understanding where the new brackets are for injury to feelings, and also how the brackets will work where an individual's earnings are less than £30,000 given the cap will be lower than the maximum award for injury to feelings.
The increase to the cap for discrimination claims is substantial, reflecting the seriousness with which the Tribunal is prepared to treat discrimination claims. In line with this trend, now more than ever employers must ensure that their policies and practices are up to date and compliant with the law to mitigate the risk of discrimination claims and reduce the corresponding financial exposure. In the first instance, employers should work to eliminate discrimination in the workplace altogether by conducting regular training sessions on the standards of behaviour expected and ensure that all employees are aware of their obligations.
Unfair dismissal compensation
Another important change is to the compensation for unfair dismissal claims. Firstly, the proposed amendments introduce two new bands to the existing regime, enabling the Tribunal to better compensate employees with particularly long service. Under the new provisions, employees with 10 to 15 years' service will be awarded 31 weeks' pay and employees with 15 or more years' service will be awarded 36 weeks' pay. These two new bands will be in addition to the existing cap on compensation for unfair dismissal which currently ranges from eight weeks' pay for employees with one year's service to 26 weeks' pay for employees with five or more years' continuous service.
Secondly, the Tribunal may consider the employer's conduct when making compensation awards for unfair dismissal claims. If an employer is considered to have behaved unreasonably, ie by failing to follow a proper process or the JACS model codes, the Tribunal may increase the compensation award by up to 25%. By way of example, if someone has five years' service, the maximum award they would be entitled to if they were to bring an unfair dismissal claim would now be 32.5 weeks' gross pay instead of 26 weeks' gross pay.
This will be a hugely significant change for employers, who will need to consider taking active steps to manage an employee's dismissal even if they are going to look to negotiate exit terms. Otherwise, they run the risk of increasing the financial exposure to the business by 25%. Obtaining legal advice will therefore be key in ensuring that employers follow a fair and consistent process when handling dismissals.
General increase to compensation for breach of statutory and contractual employment rights
Finally, the legislative proposals will also introduce a general increase in compensation for breaches of both statutory and contractual employment rights. Going forwards, the cap for a breach of a range of employment statutory rights (for example, in relation to flexible working requests, provision of statement of employment terms, and rest periods) will increase from four to eight weeks' pay.
The compensation cap for any breach of an employee's contractual rights is also set to increase from £10,000 to £30,000 per claim to align with the limit in the Petty Debts Court.
Recommendations for HR professionals and business leaders
The proposed amendments have far-reaching implications for HR professionals and business leaders. To ensure compliance and minimise legal risks, it is essential to review and update existing policies, procedures, and training programmes. Here are some key recommendations to consider:
- Update exit processes and leaver letters: Ensure that your exit processes include the provision of written reasons for dismissal within the required timeframe. Review and revise leaver letters to comply with the new requirements.
- Train managers and HR staff: Provide training to managers and HR staff on the new requirements and the importance of following fair and consistent procedures. Emphasise the potential financial and legal consequences of non-compliance.
- Review discrimination policies: Update your discrimination policies to reflect the increased compensation awards and ensure that they are legally compliant. Conduct regular training sessions to raise awareness and prevent discrimination in the workplace.
- Seek legal advice: Consider seeking legal advice to ensure that your policies and practices are in line with the new amendments. Legal advice can help you navigate the complexities of the new requirements and minimise your legal risk.
Conclusion
As outlined the proposed amendments will significantly enhance employee rights whilst greatly increasing the potential financial exposure for employers. By understanding and fully complying with these new requirements, employers can ensure fair treatment of employees, mitigate legal risks and promote a positive workplace culture. Against the backdrop of these proposals, it will be essential to stay informed and proactive in updating policies, procedures and arranging training programmes in order to align with Jersey's new legal landscape.
The proposed amendments will now be sent for Royal Assent, and they are expected to come into force later this year. Once in force, the increased remedies will apply to any claims that are still in the Employment and Discrimination Tribunal. It is therefore important to take action now, before the amendments come into force, to make sure your business is in the best place to avoid these risks.
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.
