LONDON, UNITED KINGDOM--(Marketwired - Apr 30, 2013) - On 6th April, sweeping changes to UK employment legislation came into effect, reducing the timeframe during which employers are legally obliged to consult with their staff before making large lay-offs. Redundancy solicitors ThomasMansfield said the implications for employees are "significant and without precedent."
The old laws required employers to consult with unions or other worker representatives at least 30 days prior to a mass redundancy affecting between 20 and 99 employees at any one establishment, and 90 days if 100 or more workers were due to be dismissed. Under the new legislation, the 90-day minimum is being reduced to 45 days, with the rules regarding fewer than 100 employees remaining the same.
The Coalition described the previous 90 day minimum as 'arbitrary' and said it impeded flexible restructuring. A government source also cited the EU Collective Redundancies Directive, which does not prescribe minimum consultation periods, as evidence of the disparity between British and European standards.
The move is expected to prompt a surge in employment litigation related to mass redundancies. A spokesperson from ThomasMansfield said of the announcement:
"Redundancy solicitors specialising in employment law are anticipating an increase in allegations of unfair dismissal. Anything that mobilises a large group of workers creates a lot more noise than a single, disgruntled ex-employee."
Of the government's comparison to EU employment laws, ThomasMansfield said, "Employer's collective redundancy obligations in other European countries are typically more proscriptive and restrictive than in the United Kingdom, casting some doubt on the government's claim of trying to achieve parity."
Two other changes were announced pertaining to the revised redundancy laws. One clarifies existing legislation, excluding fixed-term contracts that have reached the end of their natural life from any obligation toward collective redundancy consultation. And the other introduces ACAS (Advisory, Conciliation and Arbitration Service) guidance addressing key issues affecting collective redundancy consultation.
The rules surrounding fixed-term contracts will only enforce exclusion when a contract expires at its agreed termination point, meaning fixed-term employees will still fall within the scope of the new consultation rules if their employer plans to make them redundant prior to the expected date of dismissal.
The Coalition has emphasised that the new 45-day period is a minimum requirement, and employers should aim to go beyond it where appropriate. According to ThomasMansfield, the changes will be "welcomed by the majority of big employers" enabling them to restructure more quickly, cutting the costs of overhauling the payroll.