Tribunal blow for employers as courts could get right to raise payouts by 50%

Changes to the Employment Bill could leave employers liable for higher levels of damages at employment tribunals, experts have warned.

City law firm Reynolds Porter Chamberlain said proposed alterations to the Bill, which comes into force next April, will grant employment tribunals discretion to increase awards by 50% – twice the original amount proposed.

Simon Henthorn, solicitor at Reynolds Porter Chamberlain, said this would come as a serious blow to employers who were already opposed to the 25% increase on payouts.

“Businesses will argue that a 50% uplift could not have come at a worse time when the economy is facing a downturn,” said Henthorn.

He added the new 43-point Acas Code of Practice that is replacing the current three-step dispute resolution procedure would cause more trouble for employers, as tribunals will be able to decide whether there has been “unreasonable failure to comply”.

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“A more complex code and a lack of clear guidance on what constitutes ‘unreasonable’ will put employers at greater risk of slipping up,” Henthorn said.

Meanwhile, some employment law changes could be postponed due to the economic crisis.