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Same Old, Same Old – Or New Age?

January 17, 2006

In common with recent years 2005 brought a variety of new employment laws into force as well as introducing wide ranging changes to existing law. These changes included:

  • New rights for employees to be informed and consulted by their employers over a range of issues. These changes affected organisations with 150 or more employees requiring them to inform and consult with works councils (where appropriate) on management decisions including changes in the organisation of the work or workforce such as redundancies and job transfers.
  • The Sex Discrimination Act 1975 was updated to bring into UK law the provisions of the EU Equal Treatment Directive, introducing a new definition of indirect sex discrimination and sexual harassment.
  • The scope of the Disability Discrimination Act was extended to include definitions of disability to cover persons with progressive illnesses such as HIV, multiple sclerosis and cancer and ensure that people with mental illness are protected in the same way as other disabled persons.
  • The Civil Partnership Act 2004 created a new legal relationship allowing same sex couples to gain formal recognition of their relationship to make the status of the civil partner comparable to that of the spouse, which affects employment related legislation dealing with maternity, paternity and adoption leave and pay, flexible working and sexual orientation.

Again, in common with recent years, radical changes are expected on the Employment Law front in 2006. The main legislative development concerns age discrimination. To implement the EU's equal treatment framework, the UK is required to introduce national legislation prohibiting discrimination on the grounds of age by December 2006. Draft regulations have been published and employers now have a short time to assess how the provisions might work, to update their policies and to develop a workplace culture in which age discrimination and harassment are unacceptable.

The legislation aims to ban age discrimination in recruitment, promotion and training (and this means discrimination against the young as well as the old), ban retirement ages below the default retirement age of 65 (except when objectively justified), remove upper age limits for unfair dismissal and redundancy rights and introduce a duty for employers to consider employee's requests to consider working beyond retirement.

The final version of the regulations is scheduled for publication by the end of March 2006 and will come into force on 1st October 2006. The first draft of the regulations have attracted much criticism. The provisions relating to retirement are complex and as such, many commentators believe that if the provisions are implemented in accordance with the current draft it is possible that employers will be inclined to dismiss all their employees at a default retirement age to demonstrate that dismissal was genuinely by reason of retirement. This would obviously be contrary to the Government's intention of enabling older workers to continue working beyond the current retirement age.

The age discrimination draft legislation is markedly different from other discrimination legislation in that employers may lawfully treat employees less favourably on the grounds of their age provided that they can show that the treatment is a proportionate means of achieving a legitimate aim, in other words, direct age discrimination unlike race or sex discrimination may be objectively justified, but the most controversial policy decision is the decision to introduce the default retirement age of 65.

Other changes on the radar for 2006 include:

  • the much hyped revisions to the regulations governing the Transfer of Undertakings (TUPE). TUPE reform has been mooted for some years on a continuous basis. A final version of the new Regulations is anticipated shortly, but this has been the case for some years;
  • new compensation limits for Tribunal Claims take effect as usual in February. The maximum compensation in an unfair dismissal case will increase to £58,400 and the maximum weekly pay to be taken into account when calculating statutory redundancy payments and the basic award in unfair dismissal claims will increase to £290;
  • in April the statutory maternity, paternity and adoption pay and sick pay rates will increase to £108.85 per week (or 90% of average weekly earnings if less);
  • in October the Age Discrimination Legislation is expected to take affect and the national minimum wage will increase to £5.35 per hour.

Elsewhere there are a number of employment related bills making their way through Parliament this session, although as yet there are no anticipated dates for these bills.

  • The centrepiece of this is the Work and Families Bill. This is planned to extend maternity pay from six to nine months by April 2007 and will extend the right to request flexible working hours to carers of adults from April 2007. There are also provisions allowing fathers to take up to six months additional paid paternity leave during the child's first year if the mother returns to work. Significant consultation on this Bill is expected.
  • The Immigration, Asylum and Nationality Bill is likely to introduce fixed penalty fines for employers who employ illegal workers and will create a new criminal offence of knowingly employing an illegal worker.
  • The Equality Bill was reintroduced to the Commons in May 2005, and if passed (it failed to reach Royal Assent in the last session) it will create a Commission for Equality and Human Rights from October 2007 which will bring together the work of the Commission for Racial Equality, the Disability Rights Commission and the Equal Opportunities Commission. The Bill will also place a duty on Public Authorities to have regard when carrying out their functions to the need to eliminate discrimination and promote equal opportunities between men and women.
  • The Health Bill includes provisions relating to a smoke-free environment from summer 2007.

Further new bills may be introduced covering corporate manslaughter and further pension reform.

So a busy year ahead for HR Professionals!

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