Tribunal Reforms: Give with One Hand, Take with the Other?
The Government has today published draft legislation to
introduce a number of reforms to Employment Tribunals.
Although there are a number of initiatives that employers will
welcome, there is a significant sting in the tail.
So what's the good news?
- more power for the Government to limit the compensation payable
for unfair dismissal complaints - there are different proposals for
the limits applicable. One proposal is to cap the award at a
sum equivalent to one year's gross salary for the dismissed
- overhaul of the definition of 'qualifying disclosure' under the
whistleblowing legislation. This is intended to restrict
whistleblowing protection to disclosures which a genuinely "in the
What about the bad news?
- the introduction of a "bad employer tax" - if an Employment
Tribunal finds in favour of an employee, as well as awarding
compensation to the employee, the Tribunal can also issue a penalty
to the employer (payable to HM Government!)
The "bad employer tax" would be 50% of the award of compensation
but capped at £5,000. It is also to be payable within 21 days
of Tribunal's judgment.
- There are other proposals which could result in employees
having more time to lodge complaints in the Employment Tribunal - a
change reminiscent of the ill-fated statutory dispute resolution
The draft legislation has not yet been enacted. The
details of these proposals (and others) could change as the Bill
passes through Parliament. So the enacted legislation could
be quite different.
However, in the week that the Government publishes the Beecroft
Report (to de-regulate employment law and stimulate the economy),
it publishes a bill to introduce a "bad employer tax" - that irony
will not be lost on employers!