Employment & HR - colourful people chain image

A boost for the economy… and a bonus for employers?

The Government announced two important changes this month, which are intended to reduce the number of employment tribunal claims and boost the economy – no doubt, this will be music to your ears!

Currently, employees are able to bring an unfair dismissal claim against their employers once they have been in their jobs for one year and if successful may be awarded a cash sum or be reinstated or re-engaged. However, with effect from 6 April 2012, the length of time a worker has to be an employee before being able to claim unfair dismissal will be doubled to two years.

In addition, employees will have to pay a fee to issue a claim at the employment tribunal.

So why have these changes been brought about?

These two changes indicate the Government’s aim of increasing the confidence of employers in respect of being able to take on new employees without immediately facing the prospect of tribunal hearings and thus get more people into work.

The Government claims that increasing the qualifying period to two years should see the number of unfair dismissal claims drop by around 2,000 per year.

But is it all good news?

Some people have expressed concern that the changes are unlikely to reduce the overall number of unfair dismissal claims and may actually lead to an increase in other types of claims, such as discrimination, which does not require a specified length of service. However, employees will have to have a sound basis for bringing a discrimination claim, which may prove difficult for them to do.

It seems to us that the Government has clearly recognised that too many vexatious claims are being issued by employees in the tribunals and as a result employers have been encountering a great deal of expense. Perhaps these changes are the first steps towards increased rights for employers – we will just have to wait and see!