UK: Employment Law Update

After lengthy consultation, the UK government has announced that the following employment law changes will go into effect in April 2012:

• The qualifying period for unfair dismissal will increase from one year to two years.
• In an attempt to weed out weak cases, the maximum deposit amount that a tribunal can order a claimant to make if that party wishes to proceed with a weak case will increase from £500 to £1,000.
• The maximum costs that can be awarded by a tribunal without detailed assessment will double from £10,000 to £20,000.
• Employment tribunals will also have the power to direct parties to pay for witness costs (which will no longer be state funded) and to order the losing party to reimburse the successful party for these costs.
• Judges will be allowed to sit alone when deciding unfair dismissal cases.

In other HR-related news, effective in April, statutory maternity and paternity pay will increase from £128.73 to £135.45 per week, and statutory sick pay will increase from £81.60 to £85.85 per week.

April 5 is also the last day an employee can be retired using the Default Retirement Age (DRA) transitional provisions, unless there is an agreed statutory extension. 

On February 1, 2012, new limits on employment tribunal awards regarding unfair dismissals went into effect. The new legislation increases the maximum compensatory award for unfair dismissal from £68,400 to £72,300 and raises the limit on a week’s pay for calculating statutory redundancy pay and the basic award for unfair dismissal from £400 to £430.