11 July 2013

Employment Law Update: July 2013

Unfair dismissal cap to be altered under new proposals

A draft order, ‘Unfair Dismissal (Variation of the Limit of Compensatory Award) Order 2013', which seeks to vary the upper limit on the unfair dismissal compensatory award has been put before Parliament, presently awaiting further scrutiny from the Government.

If made the order will modify the current top limit for the compensatory award to the lower of either 52 weeks' pay or the current limit of £74,200. This will only be where the effective date of termination is after the date on which the order is made. Though at present and as always there is no firm date for when the order is likely to be made, the Government has stated it intends this to take place this month.

This can again be seen as a further extension of the employer friendly moves made by the Government, along with of course the introduction of Tribunal fees later this month of 29th July; while on that topic there has been pushback from unions:

UNISON brings judicial review challenging Tribunal fees

Mirroring a similar action in Scotland, UNISON are lodging an application in the High Court for Judicial Review (JR) into the introduction of Employment Tribunal fees. For those unfamiliar with administrative public law, JR is generally the legal mechanism by which the courts supervise government, local authorities and other public bodies to ensure that they act fairly and lawfully.

The union state that the introduction of the fees is in breach of EU law and contrary to the principles of access to justice. Beyond the wider argument of unfairness, UNISON argues that the introduction of fees are indirectly discriminatory as the fees may have a disproportionate adverse impact on women who are likely to earn only an "average income" and therefore will not be entitled to fee remissions.

At the time of writing it is too early to tell whether or not any such application could be successful. As anticipated as this challenge was, JR can still be very unpredictable given the way it relies on the case law of previous JR decisions.

Lies, Damned Lies and STATISTICS

All the chops and changes going on with Employment Law this year will eventually translate into statistics; in these times of Government belt tightening it is perhaps ultimately the numbers that inform policy as much as public opinion and consultation. With that in mind we bring you the vital statistics from the first quarter (Jan to Mar) of 2013 for the Employment Tribunal (ET) system, and with them an insight into the figures the Government are trying to reduce:

• 57,737 claims to the ET in total - a rise of 36% on the same period for 2011/12; of these 16% were for unlawful deduction from wages and 11% were for unfair dismissal.
• 27,778 disposals (claims withdrawn, settled, dismissed or going to hearing) made by the ET - 3% less than in the previous year.

Much of the quarterly increase in claims was mainly due to the claims brought under the Working Time Directive. However it is anticipated that the latter part of the second quarter for this year, that is up to 30th June, is likely to see a much sharper increase as the stampede commences to lodge claims before the introduction of ET fees.