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Beecroft Report published

The government has published the Beecroft report on Employment Law. The report was published early after an initial draft was leaked to the Daily Telegraph. The report was commissioned as part of the Red Tape Challenge and was compiled by Adrian Beecroft, venture capitalist. He was asked to provide his thoughts on areas of employment law that he considered may have potential for further improvement or simplification to help business.

The report makes recommendations in relation to employment law but there is no obligation on the government to implement them. David Cameron’s spokesperson has said that he “is not wedded to one set of proposals or another, but he does believe he should look at what can make the process (on employment) easier”.

The report, dated 24 October 2011, has set out a number of recommendations under 16 different headings. You can read the full report here. The government has already taken action on a number of these recommendations through consultations and calls for evidence.

In addition to the “Compensated No Fault Dismissal” proposals (which the report suggests would apply to all employers), discussed in Jesse’s blog post yesterday, some of the more newsworthy recommendations are:

  • Businesses with less than 10 employees could choose to opt out of certain (current and potential) regulations. The business would have to make clear to potential employees which regulations they have opted out of. The regulations include unfair dismissal, auto-enrolment for pensions, the right to request flexible working (other than for parents and carers) and flexible parental leave.
  • The impact of the removal of the Default Retirement Age (DRA) should be closely monitored and if the impact is very negative, a DRA, probably at a higher age than previously, should be reintroduced. The government has previously indicated that it will review the impact of the abolition of the DRA in 2016.
  • The ACAS guidelines relating to unfair dismissal should be reviewed and made simpler.
  • The cap of £72,300 for compensation on unfair dismissal should also apply to discrimination-related unfair dismissals. At present, the cap does not apply if the dismissal relates to discrimination. The recommendation would mean that an individual would receive an injury to feelings award in respect of the discrimination (injury to feelings awards typically range from £600 – £30,000) and no more than £72,300 in respect of loss of earnings arising from the dismissal.
  • Micro businesses with less than 5 employees should be excluded from the auto-enrolment pension scheme.
  • An enhanced work permit system should be created to record everyone with a right to work in the UK. Employers would then automatically be told when the employee’s right to work is about to expire. Employers would no longer need to keep records or spend significant amounts of time checking new employees’ paperwork to confirm they had the right to work in the UK.
  • A number of changes in relation to TUPE should be made. These include providing for the harmonisation of the terms and conditions of transferred and original employees after a period of one year; and giving a clear definition of what an ETO reason is (an economic, technical or organisation reason which allows employers to change the contract or dismiss the employee).
  • The consultation period for collective redundancy should be 30 days (or 5 days in the case of insolvency) regardless of the number of employees to be made redundant. The calls for evidence on TUPE and redundancy consultation reform both closed in January and we are waiting for the government’s response.
  • Repeal the third party harassment provisions in the Equality Act 2010. The government has launched a consultation on this proposal, which will close on 7 August 2012.
  • Fees for employment tribunal claims should be introduced as soon as possible. The fee levels proposed by BIS in its consultation on introducing fees (which closed in March) should be accepted.

It seems that the government is not planning to take forward the suggested changes to pensions auto-enrolment or immigration law. It will be interesting to see how many of the other proposals actually come into force.

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