Video: Employment law under a new Government

With a general election due in the next few months, XpertHR editors Jo Stubbs and David Shepherd examine the institutional constraints, both European and national, that will limit any new UK Government’s freedom of manoeuvre on employment law. They also identify potential areas where current rules could be changed easily and therefore early in the life of a new administration. 

 

Video: Employment law under a new Government

 

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Employment law under a new Conservative Government
We consider those areas of employment law on which an incoming Conservative Government might focus. We look at the indications about Conservative policy in these areas, and at how easy it would be for a new Conservative Government to change the current rules, and the mechanisms that it might use. Our guidance covers:

  • Primary or secondary legislation required?
  • Europe and the social chapter
  • Equality law
  • The Equality and Human Rights Commission
  • Trade unions and industrial action
  • Individual employment rights
  • The national minimum wage

 

The video questions in full

How easy would it be for a new Conservative Government to restore British control of social and employment legislation?
This would involve the agreement of all the member states. This would be a possibility, but not particularly easy. Given that the Lisbon Treaty has still not been ratified almost two years after it was agreed, such a change would be extremely unlikely to occur within a short time frame. 

What scope would a new Conservative Government have to amend existing domestic legislation based on European Directives?
In practice, domestic legislation has tended not to go beyond the minimum required to implement the relevant Directive. The exception is the additional 1.6 weeks' minimum annual leave that the Labour Government has brought into force over the last couple of years, which goes beyond the four weeks' leave provided for in the Working Time Directive. However, it is unlikely that a new Conservative Government would want to cut holiday entitlement as an initial measure. 

Going beyond the constraints of Europe, what factors would impact on the ability of a new Conservative Government to change domestic employment law?
One thing that is likely to be important is whether a change could be brought about relatively easily by secondary legislation - a statutory instrument - or whether it would need an Act - primary legislation - and all the parliamentary time that this entails. Because any new administration has a large number of potential Acts competing for parliamentary time, changes that require extensive primary legislation would be unlikely to be made early in a new Government's first term. 

Which areas of individual employment law might attract attention from a new Conservative Government?
While it must be stressed that the Conservatives have not indicated that it is their intention to do so, they could amend the qualifying period for unfair dismissal, which currently stands at one year. This could be done without primary legislation. The qualifying period is set out in s.108 of the Employment Rights Act 1996 and can be varied by the powers set out in s.209. It was last amended in 1999 when it was reduced from two years to one by the incoming Labour Government. 

At the moment, to qualify for the right to claim unfair dismissal an individual must be an employee. Could the scope of the right be amended to exclude certain categories of employee?
Yes. s.209 of the Employment Rights Act 1996, the Secretary of State can use an order to provide that any provision of the Act does not apply to classes of people or employment set out in the order. This is subject to a number of exceptions, but the right not to be unfairly dismissed is not one of them. Although no such proposals have been put forward, this could mean that a new Government could use an order of this kind to exclude, for example, employees of small businesses from the right to claim unfair dismissal. 

Could compensation for unfair dismissal be dramatically decreased with ease?
Prior to the coming into force of the Employment Relations Act 1999, the maximum unfair dismissal compensation award stood at £12,000 and the annual uplift was a matter for individual ministerial decision. The Labour Government’s Employment Relations Act 1999 changed that. It increased the maximum to £50,000 and provided for a specific mechanism linking the maximum to inflation, under which it is now £66,200. This could not be reduced to pre-Labour-Government levels without primary legislation. 

The national minimum wage was a key plank of the Labour Party manifesto in 1997 and was strongly opposed by the Conservatives. Is it likely to be abolished under a Conservative Government?
No, David Cameron has said that a Conservative Government would not seek to abolish it. That does not mean, however, that some reform of the way in which the national minimum wage works would be out of the question. Although the National Minimum Wage Act 1998 governs the national minimum wage as a whole, much of the detail of its application is set out in regulations (chiefly the National Minimum Wage Regulations 1999 (SI 1999/584)), which could be amended relatively easily. 

 

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