Tuesday, 11 December 2012

Employment updates: December 2012

Parental leave increases from three to four months

The permitted period of parental leave following the birth or adoption of a child is to increase from three to four months, and at least one of the four months will not be transferable between parents, according to the amended EU Parental Leave Directive. 

The change came into force in March 2012, but the Government confirmed at that time that it planned to rely on the exception that allows EU member states an extra year for implementation, and that it will implement the change by 8 March 2013.

The extension to leave presents both a benefit to new parents and an issue that can't be ignored for businesses; though before creating any anxiety it should be remembered that not all parents will wish to take four months, so keep speaking to all expectant parents about their intentions!

Confirmation: 'Employee-owner' contracts to be introduced in April 2013

The 'employee-owner' contract is a new type of employment contract which will see 'Employee-owners' given between £2,000 and £50,000 of shares in the business (exempt from capital gains tax) in exchange for forgoing certain employment rights. 

The key rights to be forfeited:
Employee-owners would not receive the standard unfair dismissal protection after two years' continuous service. 

Employee owners would be unable to make statutory requests to work flexibly or in relation to study or training. They would also  not be protected against dismissal for making such requests. The exception is a request for flexible working made on return from parental leave. 

Employee-owners would not be eligible for statutory redundancy pay.

They would also be required to give 16 weeks' notice if they wished to return early from maternity or adoption leave; this is compared with eight weeks for employees.

The decision by the Government to press ahead with this initiative is an interesting one. During the consultation on the proposals, they were supported by only a very small number of businesses, and have been universally opposed by employee representatives and Trade Unions. They have been criticised by key voices in the HR profession as "damaging" to the employment relationship, with a risk of huge impact upon staff loyalty, engagement and skills retention. 

More details are due to be announced, and we hope that companies will be prevented from offering only this type of contract in future.

Financial penalties to be imposed on employers that breach employment rights

The Enterprise and Regulatory Reform Bill gives tribunals the power to levy a financial penalty against employers that are in breach of employment rights "where the breach has one or more aggravating features."

If the tribunal makes an award of compensation, the amount of the penalty will be 50% of the award. The penalty is subject to a minimum threshold of £100 and an upper ceiling of £5,000

Employers will qualify for a reduction of 50% if they pay the penalty within 21 days. The Bill can be viewed on the UK Parliament website.

Eye tests for professional drivers

The EU Driving Licences Directive prescribes that holders of commercial driving licences will be required to have their eyes tested every five years. The UK must implement the Directive by 2013. The Directive can be viewed on the Europa website. 

The Directive is welcome news which can only serve to better protect the eye health and safety of professional drivers and increase safety on our roads.

All potential employment tribunal claims to be referred for mediation

The Enterprise and Regulatory Reform Bill requires potential claimants to lodge details of their proposed employment tribunal claim with Acas in the first instance. Acas will offer the parties the opportunity to engage in conciliation with a conciliation officer for a prescribed period. Where the conciliation officer concludes that a settlement is not possible, or where the prescribed period ends without reaching a settlement, the claimant will be issued with a certificate permitting him or her to issue proceedings. 

As accredited mediators, we welcome the news that mediation will have a part to play in early resolution- too many cases come before tribunals that could have been addressed with better communication in a dedicated space suitable for all parties.

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