In the first of two articles looking at employment law changes taking effect in April 2014, we focus on legislation affecting pre-Tribunal claim situations and post-Tribunal hearings when an employer has lost a claim. These changes are particularly relevant to employers who are currently dealing with contentious situations which could lead to a break down in the employer/employee relationship and may result in a claim being made.
From 6th April 2014, anyone considering an employment tribunal claim will be required to lodge the details with Acas in the first instance. Acas will then offer both parties the opportunity to engage in conciliation with a conciliation officer.
What does it mean to me?
To business owners, this means that there is a further opportunity to resolve matters before a tribunal claim is made. It is reliant on both parties being willing to engage in the conciliation process but it may mean that a costly and time-consuming tribunal claim can be avoided, saving you time and money.
Financial penalties at Tribunal
From April 2014, tribunals will have the power to impose a financial penalty against employers that are in breach of employment rights where the breach has one or more aggravating features. The key points to note are:
- The penalty can be between £100 and £5000 and can be levied against an employer who has lost a case.
- The penalty does not go to the claimant but to the Secretary of State and the Consolidated Fund.
- A financial penalty may be ordered against an employer even if a financial award has not been made to the claimant.
- If a financial award has been made, the financial penalty must be 50% of the amount of the award.
- If the employer pays the penalty within 21 days it will get a 50% discount.
- Tribunals must take account of the employer’s ability to pay when deciding whether to order a penalty.
What does it mean to me?
Unhelpfully, the legislation itself doesn’t explain what will be considered an “aggravating feature” which means that it’s difficult to say what kind of breach/es will be taken into consideration. It has been suggested that penalties should be imposed where unreasonable behaviour has been involved, such as negligence or malice. However, it is believed that genuine mistakes by an employer will not be penalised.
As with most employment law changes, it remains to be seen just what effect these financial penalties will have once they come into play. Another incentive, if one were needed, to take advice early and get it right when dealing with your employees!
If you are currently dealing with a difficult situation with an employee, contact us today on 01487 815720 for a no-obligation chat in confidence about the options available to you.