How Tribunal Reforms affect your rights as an employee

April 6th 2012 marked the commencement of forthcoming Employment Tribunal reforms which could potentially seriously affect your rights as an employee.

The key reform that came into force on 6 April (and affects employees starting new jobs from 6 April 2012) is that the amount of time you need to work at an organisation before you are protected from unfair dismissal will increase from one year to two years. This takes the position back to pre-1999, when the one-year qualifying period was introduced. 

This reform means that effectively employers have carte blanche for a period of two years from hiring to dismiss an employee without having to worry about a possible unfair dismissal claim, as long as the employee has not been discriminated against or blown the whistle. 

It is possible that the decision to amend the legislation could be open to a challenge as age discrimination.  Younger workers are more likely adversely affected by this change on a generic basis, as they are less likely to have been employed for long enough to qualify for unfair dismissal protection. However, although this is a possibility, I think we can safely say that the tides are shifting for employment protections and employee rights are loosening somewhat.

In that light here are some practical tips to survive the new employment environment:

• If you already have more than one year’s worth of service and are considering a job change after 6thApril, you should be aware that you will lose unfair dismissal protection for two years. Although this should not prevent you from taking up your dream job, bear in mind you will be sacrificing some security for a period.
   
• Some claims other than unfair dismissal do not require a qualifying period of service, most notably discrimination and whistleblowing. If you are unable to bring an unfair dismissal claim, consider whether it is possible to bring a claim on other grounds.
   
• If you are in a position to do so it would be wise if possible to try to negotiate a longer notice periods at the start of a new job, as this will provide a vital financial buffer in the event of dismissal in the first two years. In practice however, this is usually not something that most employees other than very senior executives are in a position to do. 

The business community has argued that this reform will allow businesses greater flexibility and help them to take on new staff (although only 51 per cent of those surveyed by the Institute of Directors, which formed part of the Government’s consultation, said it was a 'significant' or 'very significant' factor in recruitment) thereby helping to reduce unemployment and promoting growth.

It is hard to see how businesses can argue that they need longer than the current one year to determine whether an employee is suitable, particularly as probation periods are usually 3-6 months. 

There is an economic argument that if employees do not feel secure in their positions they will not be as productive, countering the 'growth' argument from businesses and the Government.

Arguably if anything, this will provide employees with a disincentive to move jobs as any employee could lose valuable rights. This could make the labour market less mobile, which could be bad for the economy.

Additionally, there could be a rise in other types of claims which do not require a qualifying period of service, most notably discrimination and whistleblowing, which are more complex, incurring more costs for both parties and the Tribunal. 

 Other reforms from 6th April relate to the cost regime in the Employment Tribunal, witness statements being taken as read and judges sitting along in unfair dismissal cases.  These are less controversial, although there is a concern that lay members will not be trained up enough on the less complex cases so that they can deal with the complex discrimination cases. 

Also, reforms are expected with the introduction of a fees regime for the Employment Tribunal in order to bring cases.  This is of great concern as many individuals (particularly low paid workers) may find that their access to justice is denied due to the upfront costs in pursuing a claim. 

We wait for further announcements on this issue. The Government is keen to reform the law but there is a risk that 20 years of progressive employment legislation will be undermined.

Richard Macmillan is a solicitor in the employment team at national law firm Russell Jones & Walker.