New year, new law – Government announces important changes to employment law

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Posted in:HR and Employment|January 17, 2013 | Join the mailing list

On 17th January 2013, the Government announced that it was pressing ahead with its proposed new laws in relation to termination of employment settlements and also with regard to new limits on unfair dismissal compensation. It also announced
a consultation process with regard to significant proposed reform of the Transfer of Undertaking Regulations (commonly known as TUPE).

Under the settlement agreement legislation, employers will be able to approach employees with regard to a possible termination of employment settlement deal without running the risk of the employee being able to refer to that approach in
a subsequent unfair dismissal claim if, in the end, no settlement is reached. The Government’s intention is that the new laws in this area should be in effect by summer 2013. 

The new legislation in relation to unfair dismissal compensation will mean that the maximum amount that a tribunal will be able to award a successful unfair dismissal claimant will be whichever is the lower of 12 month’s salary or the maximum
statutory cap (which is currently £72,300 rising to £74,200 on 1st February 2013).

The Government’s proposals with regard to TUPE include a proposal to remove from the TUPE legislation the sections in relation to "service provision change". Under those sections, TUPE applies to contracting out and contracting in of services
and also to where there is a change of contractor providing the services. The Government sees those provisions as going beyond the requirements of European law.

Partner in the Berg Employment Team, Nigel Crebbin, comments that all of this points to 2013 being another busy year for employment law.

"The Government has made clear that it wants the new legislation on settlement agreements in place by the summer and it also looks likely that that will be the time when fees in relation to Employment Tribunal claims come into effect. The
new laws in relation to employment contracts, under which employees will be able to give up certain employment rights in return for shares in their employer, are also intended to be brought in within the next few months. As always, employment law is a fast
moving field and employers will need to make sure that they keep themselves properly up to speed over the coming year".

For more information regarding these or any other employment law issues,  please contact Nigel Crebbin or Claire Haworth on 0161 833 9211 or email us at or
The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Berg or any of its partners or employees. Professional legal advice should
be obtained before taking, or refraining from taking, any action as a result of this article.

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