April 2012 employment law changes: six things employers need to know

Every April a host of changes are made to employment legislation and 2012 is no exception. This year, important amendments include those relating to tribunal procedures, unfair dismissal and statutory maternity and sick pay. Personnel Today sets out the key reforms that will affect employers.

1. Employment tribunal procedure reformed

On 6 April 2012, the maximum amounts of deposit and costs orders increase with the aim of reflecting more accurately the cost to employers of defending tribunal claims. To minimise the cost of tribunal proceedings to the taxpayer, tribunals have a new power to direct that the parties to a dispute are responsible for paying witnesses’ expenses, and employment judges hear unfair dismissal cases alone. To speed up tribunal hearings, witness statements are taken “as read”.

2. Statutory maternity, paternity, adoption and sick pay increase

On 1 April 2012, the weekly rate of statutory maternity, paternity and adoption pay increases from £128.73 to £135.45.

The weekly rate of statutory sick pay also increases, from £81.60 to £85.85, on 6 April 2012.

On 6 April 2012, the lower earnings limit for primary Class 1 national insurance contributions increases from £102 to £107, the income tax personal allowance increases to £8,105, and the threshold at which employees pay the higher income tax rate of 40% is reduced to £34,371.

3. Qualifying period for unfair dismissal increases

On 6 April 2012, the qualifying period for making an unfair dismissal claim (in most circumstances) increases from one to two years. The change applies only to employees who start their job on or after 6 April 2012.

The qualifying period for the right to receive a written statement of reasons for dismissal, on request, also increases from one to two years.

4. Calculation of staging date for pensions auto-enrolment

From October 2012, employers will be required to auto-enrol eligible jobholders into a qualifying workplace pension scheme. The date from which employers must auto-enrol employees (known as the “staging date”) is based on the number of employees in their PAYE scheme on 1 April 2012.

Employers should check how many people are in their PAYE scheme to determine their staging date.

5. Accident-reporting requirements change

On 6 April 2012, the required period of incapacity following an injury caused by an accident at work, which triggers the employer’s requirement to report the accident to the enforcing authority, increases from more than three days to more than seven days. The deadline by which the employer must report the accident increases from 10 days to 15 days.

6. Definition of “independent adviser” for compromise agreements clarified

Section 147 of the Equality Act 2010 is amended on 6 April 2012 to confirm that an employee’s representative can be an “independent adviser” for the purpose of a compromise agreement. This deals with one of the conditions of a valid compromise agreement, which is that the employee has received advice from an independent adviser about the terms and effect of the agreement.