Business Secretary Vince Cable has announced reforms to the UK’s employment laws that make it easier for employers to dismiss under-performing employees. The amended laws include settlement agreements which will give employers the opportunity to pay-off under-performing staff to prevent future claims of unfair dismissal. Although workers are not obliged to accept a pay-off, if they do so it will be legally protected and as such cannot be brought up as evidence in a future court case or tribunal.
At the same time, the maximum limit for a pay out for unfair dismissal is being reduced. It currently stands at £72,300, but MPs want this reduced to a maximum of 12 months’ salary. The aim is to encourage employers, particularly small and medium sized firms, to employ more people.
Critics say the proposals only benefit employers and remove rights from workers, but many employers, particularly smaller firms, should find some benefits, including savings of time and resources, and greater security.
Thomas Mansfield, employment solicitors London based, points out these new settlement agreements are pretty much the same as the existing compromise agreement system. Currently employees and employers can come to a specific agreement over a financial pay out from the employer in return for the employee bringing no claims against the employer in the future. Free legal representation is offered as part of this package, and Thomas Mansfield predicts it will be included in the new settlement agreements too.
The UK’s legal system is a confusing one and often beyond the reach of the ordinary worker. Thomas Mansfield is well placed to provide advice, support and representation on matters relating to employment law, including unfair dismissal and employment tribunals. It predicts the new rules are bound to cause further confusion among both employers and employees and advises anyone confused by the new laws to seek out legal advice when necessary.