Head-to-head: big issues facing employers in 2008

Looking ahead in 2008, what are the big issues facing organisations and how should they tackle them? Will 2008 be a year of business leading the way on employment law issues rather than government? Rachel Dineley, partner and head of diversity unit, Beachcroft, and Kevin McCavish, head of employment team, Shoosmiths, go head to head.

Q What is going to be the biggest employment law issue of 2008?

Rachel Dineley Age discrimination. I see lots of cases coming through that will have implications for employers because the legislation is really starting to bite and that means employers who thought they had got it right are perhaps discovering now that they haven’t. Others will have the opportunity to learn from these mistakes as we get decisions from the EAT.

Kevin McCavish I think there’s going to be a shortage of workers. The immigration amendments are coming in and that puts the onus on employers to do more checks. But there are skills shortages in a number of sectors and an ageing population. Going forward we will see a crunch in terms of the number of workers available, which is going to mean employers have to focus on retaining existing staff. Especially key working staff.

Q Will this have any knock-on effects?

Rachel Dineley If we have an economic downturn, I think we will see an increase in redundancy and restructuring. And, partly as a result of the new TUPE (Transfer of Undertakings (Protection of Employment) Regulations 2006) regulations and partly as a result of case law and age discrimination legislation, even those employers who are accustomed to dealing with reorganisation and redundancy programmes will discover there is lots to think about. Consultation, in particular, is one issue people have to be careful about these days – and specifically the duty to collectively consult whether in relation to redundancy or TUPE.

Kevin McCavish Flexible working will be a key part of retention and I imagine the government is working on it for next year, because at the moment the UK lags behind many of the continental European countries. For example, flexible working is open to 90% of people in German and Swedish companies but only in 48% of companies in the UK. At the same time only 20% of UK employers allow people to work away from the office, whereas in Germany, Sweden and Denmark it’s in the region of 40%. Those sort of restraints really affect the labour marketplace.

Q Is the lack of incoming legislation a good thing?

Rachel Dineley In one sense employers can heave a sigh of relief that while they have a lot of other problems to deal with, at least they won’t have to cater for any major changes in legislation. Particularly, the fact that the government is not forging ahead with its proposed amendment to the discrimination legislation, because many of the issues raised in the discrimination law review were not fully researched, comprehensively consulted on or carefully thought through.

Kevin McCavish We have already had a lot of the legislation we are going to have and the government has deliberately eased back because there is a lot less coming though Europe at the moment. Even the drive from Europe is that we have enough employment legislation so I don’t see anything big on the horizon there.

Q Are there any issues that need effective legislation this year, so are consequently going to get worse?

Rachel Dineley The government quite properly wants to encourage the child-bearing population to have children otherwise we will have an economic problem on our hands with an ageing population. But the balance has to be found between supporting working parents and encouraging good employment practice. Many employers feel that the opportunity to request flexible working should be extended to all workers, and while it is possible for this to happen in 2008, it is unlikely.

Kevin McCavish I see the need to reform equal pay, which is hitting county councils in the North East and the NHS, but I don’t think there will be any equal pay legislation in 2008 because it is such an important piece of legislation to bring in. I think 2008 is a period of bedding in and getting rid of legislation. If you look at the new statutory dismissal procedure rules, there is a move afoot to abolish those and the legislation will probably come in in 2009. So what legislation they have introduced they are now taking away because they’ve decided it’s too much bureaucracy and it’s not having the desired effect of securing employee rights in the workplace.

Q Will 2008 be a year of business leading the way on employment law issues rather than government?

Rachel Dineley Yes. And it is a good thing. It would be terrific if we could see employers identifying and tackling employee relations issues to create the most flexible and employee-friendly workplace in the best interests of all without being forced down that road by legislation, as legislation doesn’t necessarily get things right.

Kevin McCavish It’s good that people are now concentrating on what the law says and, particularly, whether rights should be extended to parents or all workers. We’re going to be seeing a lot more companies introducing greater flexible policies just to keep hold of their staff. If you look at paternity rights, a lot of companies have implemented greater paternity protection rights or greater paternity pay rights than the government has, and I think that attitude is feeding into flexible working. Many employers are realising that when it comes to retention, salaries aren’t everything.

Viewpoint

Adam Fuge,
Partner,
Matthew Arnold & Baldwin

The most important development this year will probably be the consultation on the Employment Bill. Although the Bill is unlikely to be passed until April 2009, the consultation process has the potential to fundamentally alter the employment law landscape in the future. After the embarrassing u-turn on the current procedures, the government will need to make sure it doesn’t replace one complex and unworkable system with another. The consultation process in 2008 will therefore be crucial to ensuring that after the difficulties of the past four years, employers are left with effective legislation on this vitally important aspect of employee relations.

Fiona Colquhoun,
Mediator and director,
Centre for Effective Dispute Resolution

One of the bigger things is the repeal of the statutory regulations on discipline and grievance matters, which will do away with the three-stage procedure that’s caused absolute confusion. The regulations were generally well intentioned but over-complicated in execution and also don’t have enough scope for processes being resolved outside a strictly single-track process. I’m not sure if it’ll be completed in 2008, as the parliamentary process takes a long time, but we’ll get nearer to change and I recommend employers prepare now by incorporating mediation into their employment policies. It could be case that business has to move faster than the government.

Kieran O’Keefe,
Policy adviser,
British Chambers of Commerce

The new Equality and Human Rights Commission has strong ambitions so I imagine there will be lots of debate about issues such as equality and equal pay in 2008. From a European perspective the temporary agency directive was debated in a council of employment ministers on 7 December and reached a stalemate. The French take up the European presidency in July and I imagine they’ll make a push for it to come up again. It gets the juices flowing on all sides of the argument, so I can foresee lots of debate about its merits in the coming months.

Ben Wilmott,
Employee relations adviser,
Chartered Institute of Personnel and Development

Age is likely to be a big issue because the anti-discrimination legislation came in last year. I think employers are still having to change their mindsets on how they manage age in the workplace because it cuts across all aspects of employment, from how you recruit to how you train, and so on. I think that’s going to be an ongoing priority and, to some extent, it’s one of those slow-burn issues as it’s going to take a little while for the momentum of cases to build up in tribunal. But we will certainly see a increase of age discrimination claims over time.

Watch out for

Changes to the Sex Discrimination Act 1975

The Equal Opportunities Commission successfully applied for a judicial review of the Equal Treatment Directive through the Employment Equality (Sex Discrimination) Regulations 2005, which amended the Sex Discrimination Act 1975. The Department for Communities and Local Government initially indicated that the revised regulations would come into force on 1 October 2007 but this has been postponed to April 2008.

Corporate Manslaughter and Corporate Homicide Act 2007

New laws on corporate manslaughter are due to be introduced in April 2008. Under the new regulations, organisations can be prosecuted for management failures that lead to the deaths of employees and others.

Information and Consultation of Employees Regulations 2004

The regulations, which implement the Information and Consultation Directive in Northern Ireland, will be extended in April 2008 to include organisations with 50 or more employees.

Age – the big issue

There are currently 19.7 million people aged 50 and over in the UK, so whatever sector you work in age is a big issue. Here’s why:

  • The percentage of people aged between 50 and pension age in employment is now higher than those aged 16 to 24. (72% compared to 56%).
  • About a quarter of older workers work part-time (25%).
  • Older workers have spent, on average, 13.3 years in their current jobs.
  • 22% of older workers say they work for personal satisfaction.
  • Practically all (95%) of older workers say they enjoy working with younger colleagues, with 40% claiming their younger colleagues teach them new skills.
  • Younger employees say older workers’ key qualities are: experience, reliability and understanding. They’re also more likely to work unsociable hours.

Sources: Labour Force SurveyAge Positive

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