2012 employment law changes: six things employers need to know

Every year brings with it some important new employment legislation for the employer to negotiate. Whether related to unfair dismissal, pensions, employment tribunals or redundancy, 2012 presents new legislation relevant to all organisations, large or small. Read our guide to the six key updates to make sure you are ready for the year ahead.

1. Qualifying period for unfair dismissal protection is increased

The biggest change to employment rights for 2012 is the increase of the qualifying period for an employee to bring an unfair dismissal claim from one year to two years. This change comes into force on 6 April 2012. The Government has said that it intends to increase the qualifying period for unfair dismissal to “provide more time for employers and employees to resolve difficulties, give employers greater confidence in taking on people and ease the burden on the employment tribunal process”.

2. Pensions auto-enrolment begins

In what may prove to be one of the biggest challenges of the year for larger employers, starting from 1 October 2012, employers with 50 or more employees have to enrol eligible employees automatically, and make mandatory employer contributions, into a qualifying workplace pension scheme or the National Employment Savings Trust (Nest).

3. Changes to employment tribunal procedure

The Government has announced a “fundamental review” of the Employment Tribunal Rules of Procedure, with substantial changes to employment tribunal procedure expected to be introduced on 6 April 2012. Employment judges will hear unfair dismissal cases alone in the tribunal, unless they direct otherwise. The maximum amount of a deposit order, which a tribunal can order a party to pay as a condition to continuing with tribunal proceedings, will increase from £500 to £1,000. The maximum amount of a costs order, which a tribunal may award in favour of a legally represented party, will increase from £10,000 to £20,000. Witness statements are to be taken “as read” unless a tribunal directs otherwise.

4. Statutory redundancy payments and guarantee payments increase

The maximum amount of a week’s pay used to calculate a statutory redundancy payment and the basic and additional awards for unfair dismissal increases from £400 to £430 on 1 February 2012. The maximum unfair dismissal compensatory award increases from £68,400 to £72,300. The limit on the amount of a guarantee payment payable to an employee in respect of any day also increases from £22.20 to £23.50.

5. Maternity, paternity, adoption and sick pay increase

The Government has confirmed that the standard rate of statutory maternity, paternity and adoption pay will increase from £128.73 to £135.45 per week from 1 April 2012. Statutory sick pay will increase from £81.60 to £85.85 per week from 6 April 2012.

6. Watch this space…

There are a number of other employment law developments that are in the pipeline, but for which no date has been set. Employers can keep up to date with employment law developments throughout 2012 using the XpertHR legal timetable and HR calendar. For example, there are proposals for the introduction of employment tribunal fees and plans for the introduction of “protected conversations”, and there have been calls for evidence over whether or not the law on TUPE and collective redundancy consultation should be amended to reduce the burden on businesses. The Government has also announced that it will consult on reforming the law on employment disputes and removing the third-party harassment provisions of the Equality Act 2010.

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