Employment Law Roundup 

April typically sees key changes in employment law, and April 2014 has been no different.  This roundup will look at the following: 

  • Employment Tribunal Claims – Early Conciliation
  • Increases to Statutory Payments
  • Pension auto-enrolment

 

Employment Tribunal ClaimsEarly Conciliation

Major changes occurred in the Employment Tribunal in the summer of 2013 with the introduction of application fees (see our article on Employment Tribunal Claims posted on 1 August 2013).

On 6 April 2014 “early conciliation” was introduced under the Enterprise and Regulatory Reform Act 2013.  As such, from 6 May 2014 claimants must notify the Advisory, Conciliation and Arbitration Service (“ACAS”) of their intention to lodge a claim with the Employment Tribunal before they do so.  They will do this by completing an early conciliation notification form with their basic contact details and those of their employer.  It is worth noting that employers can also make use of the early conciliation process if they suspect an ongoing dispute with an employee may lead to an Employment Tribunal claim – employers should simply contact ACAS.

It is anticipated that early conciliation will enable cases to be dealt with quickly with a cost and time saving to the parties.  

Specially trained ACAS conciliators (who are impartial and will not charge for the service) will discuss the issues with both the employee and employer (both of whom can instruct representatives, such as lawyers, to liaise with the conciliator on their behalf), with a view to resolving the issues without an Employment Tribunal claim being necessary.

The parties have up to one calendar month to try and resolve the issues through the early conciliation process, although this initial period can be extended (only once) by a further 14 days if both parties agree.

Early conciliation is a voluntary process and therefore even though a potential claimant has to notify ACAS of his intention to lodge a claim at the Employment Tribunal, he is under no obligation to go through the early conciliation process.  If he indicates this to ACAS, they will issue a certificate to enable him to proceed with an Employment Tribunal claim (the certificate will contain a reference number for the claimant to insert on their Employment Tribunal application form).

If a resolution is reached during the early conciliation process, a legally binding agreement will be prepared by ACAS for the parties to sign.  The agreement will bring the dispute to an end and bar the employee from submitting a claim to the Employment Tribunal in respect of the dispute thereafter.

If the matter is not resolved within the early conciliation period (whether one calendar month or one calendar month plus the additional fourteen days), the ACAS conciliator will bring the early conciliation to a close and provide a certificate and reference number to enable the claimant to submit a claim to the Employment Tribunal.  Matters discussed during the conciliation process cannot be referred to at any subsequent Employment Tribunal proceedings.

Early conciliation will have an impact on limitation periods for Employment Tribunal claims which usually need to be made within three months of dismissal, although this period varies according to the nature of the complaint.

When the claimant contacts ACAS to start the early conciliation process, the limitation clock will stop for up to one calendar month plus a further fourteen days if the parties agree that the extra time would be beneficial in reaching a settlement.  The time in which the claimant has to make a claim will start to run again when the early conciliation certificate is issued, whether at the start of the process (i.e. when the claimant informs ACAS that he does not want to make use of early conciliation), or at the end of the calendar month (plus a further fourteen days, if necessary).

Time will tell how successful early conciliation will be because neither employee nor employer is obliged to participate and even if they agree to do so, they can put a stop to the process at any time.  It will be interesting to see how the Employment Tribunal treat employees who refused to go through the process before making a claim and indeed, how it will view both parties if they were unable to reach a settlement during the early conciliation process.

Employers should bear in mind that on 6 April 2014 the Employment Tribunal was given the power to order employers who lose claims to pay a financial penalty of between £100 and £5,000 to the Secretary of State.  Such a penalty will be ordered if the employer has breached any of the employee’s rights and the breach had one or more aggravating factors.  Reason enough for employers to actively participate in the early conciliation process?

Increases to Statutory Payments 

The following rates were introduced on 6 April 2014:

Maximum amount of “a week’s pay” for the purposes of calculating a redundancy payment

– £464.00

Statutory Maternity Pay       

– weekly rate for the first six weeks: 90% of the employee’s average weekly earnings

– weekly rate for remaining weeks:  £138.18 or 90% of the employee’s average weekly earnings, whichever is lower

Ordinary & Additional Statutory Paternity Pay

– weekly rate: £138.18 or 90% of the employee’s average weekly earnings, whichever is lower

Statutory Adoption Pay

– weekly rate: £138.18 or 90% of the employee’s average weekly earnings, whichever is lower

Statutory Sick Pay

– Standard weekly rate: £87.55

In addition, the Income Tax personal allowance was increased to £10,000. 

Pension Auto-enrolment

The government’s pension auto-enrolment scheme aims to force employees to save for retirement by being automatically enrolled in their employer’s pension scheme.  Companies which do not have a pension scheme must either use the government’s default pension provider (the National Employment Savings Trust) or they must use an insurer to set up an in-house pension scheme. 

Employers have a “staging date” from which time they must enrol their qualifying employees into an auto-enrolment scheme; the employer’s registration with the Pensions Regulator must be completed within five calendar months of the staging date.  Because a good deal of information is required, the Pensions Regulator recommends that employers start planning well in advance of their staging date.

To calculate your company’s staging date and for further information about what is expected of you, visit the Pensions Regulator’s website: 

http://www.thepensionsregulator.gov.uk/employers.aspx

 

For further details about anything in this roundup, please contact: