Shake-up of unfair dismissal rules to be considered

[mattbatchelor]

Staff who work for small businesses could lose their right to claim unfair dismissal under plans being considered.

Ministers want views on whether firms with 10 or fewer employees should be able to sack staff without risk of a tribunal if they pay compensation.

Business Secretary Vince Cable said he wanted the process for getting rid of staff to be "simpler and quicker".

Unions oppose the idea. Labour called for measures to make it easier to hire people, rather than to fire them.

Announcing a consultation on changes to employment legislation, Mr Cable said he wanted to help firms expand without making existing staff feel insecure.

The key points include:

a "call for evidence" on whether "micro-firms" can dismiss staff without their agreement and without them being taken to a tribunal if they pay compensation
a consultation on "protected conversations", which would allow employers to have frank discussions about poor performance with workers without fear that they could be used as evidence in a tribunal
a "call for evidence" on the length of time required for a consultation period on planned redundancies. It is currently 90 days, but the government is considering reducing that to 30
a requirement for all claims to go to the conciliation service Acas before reaching employment tribunal
options for a "rapid resolution scheme" for more simple cases to be settled within three months
The business secretary also confirmed plans to make people work two years before they can make a claim for unfair dismissal from April - up from one year at present.

Mr Cable said the proposals would not erode workers' rights but would cut "unnecessary bureaucracy" and reduce the number of cases going to employment tribunal, which have risen 40% in the past three years.

In a speech to the manufacturers organisation EEF, he said he wanted a "radical slimming down of the existing dismissal process" which would help firms grow but protect individual rights.

Ahead of the speech, he told the BBC that he was not encouraging a "hire and fire" culture, saying that would be "unhelpful" in the difficult economic climate.

But he added: "We want to create an environment in which entrepreneurs want to start businesses, expand, take on staff and feel confident that they can do that and, if they run into difficulties with a particular employee, they can have a conversation with them without worrying they are going to be taken to a tribunal."

A recent government-commissioned report suggested that unproductive workers, should lose their right to claim unfair dismissal.

The Lib Dems were reported to have rejected these proposals from the businessman and Conservative donor Adrian Beecroft, believing they would not help the labour market at a difficult time for the economy.

Business group the CBI welcomed the overall strategy and called for it to be implemented quickly.

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This will just sweep abuse under the carpet?
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Paul Kenny
 
GMB union
 Adam Marshall, director of policy at the British Chambers of Commerce, said: "Mandatory Acas involvement and new claimant fees will make the system fairer by ensuring that baseless claims are weeded out, and the pressure to settle is reduced.

"The proposal to investigate a fast-track scheme for simple claims could also help.

"Once these reforms are in place, firms won't have to waste time and money and can focus on running their business and delivering growth instead. It will also mean that genuine grievances get a better hearing."

But Paul Kenny, general secretary of the GMB union, said the agenda was "being driven by the CBI, who want the balance of power in the workplace tilted even more against the ordinary worker".

"These changes will make it harder for hundreds of thousands of workers to bring cases of victimisation, unfairness and bullying at work," he said.

'Retrograde step'
 
"This will just sweep abuse under the carpet."

Mr Kenny also said a plan to require only one judge to preside over unfair dismissal cases was "retrograde" as it would remove "the voice of business and the shop floor" from proceedings.

Shadow business secretary Chuka Umunna said Labour agreed the tribunal system needed reform.

But he said: "Watering down people's rights at work by doubling the service requirement to claim for unfair dismissal from one to two years is not a substitute for a credible plan for growth.

"Instead of seeking to make it easier to fire people the government should be looking to make it easier to hire people at a time when their reckless economic policies have pushed up unemployment to a 17-year high."

Some 218,000 claims were received by employment tribunals last year.

Source: BBC News