The government recently published its long-awaited White Paper,oyee protection? Fairness at Work. As well as dealing with the terms for compulsory trade union recognition in the workplace, it introduces substantial new rights for individual employees.
The White Paper aims to promote partnership between employers and employees and is set to have a radical impact on company relations. The first of the proposed rights for individuals is slashing the period of service in employment needed to qualify for protection against unfair dismissal to one year. The current two-year requirement is being challenged before the European Court of Justice. The change would mean employers must decide whether an individual is competent before the year is out.
The government is also planning to abolish the maximum limit on awards for unfair dismissal. These are currently limited to a basic sum, calculated according to length of service, age and a maximum weekly wage, plus a maximum compensatory award of #12,000. This limit, which often creates a disincentive for more highly paid employees to claim, will be scrapped and employees will be able to seek full compensation.
The White Paper proposes index-linked limits on 'additional' and 'special' awards. Additional awards are made when an employer refuses to re-employ a member of staff despite a tribunal's order to do so. Special awards are made when individuals suffer detrimental treatment due to a special position such as a role in health and safety or a trade union.
But the government is considering whether these proposals go far enough.
Other options include removing the limits on additional and special awards altogether, or introducing aggravated damages, for example where an employer's conduct is penalised by the courts. In addition, whistleblowers, who are set to be protected by the Public Interest Disclosure Bill, may soon be entitled to receive higher awards too.
The status of employees with fixed-term contracts who can waive their right to unfair dismissal and statutory redundancy payments when contracts expire will also come under government scrutiny. There are proposals on the agenda to allow a waiver of redundancy payments only. However, it is thought this could have a detrimental affect on the flexibility of the labour market. Similarly, the government is concerned about so-called zero hours contracts, where an individual has no right to agreed amounts of work but is part of a bank of employees called in as and when labour is required.
The disadvantage to employees, apart from uncertainty, is the difficulty of proving any loss if they are dismissed and being effectively treated as employees and, therefore, unable to claim benefit if they are underemployed.
But again, changing such practices risks undermining labour market flexibility.
Because of such issues, the government is looking more generally at the distinction between an employee under a contract of employment and someone who provides work in a more general sense, for example as a contractor or someone who is self-employed.
The European Directives which are currently being implemented into English law - for example the Working Time Directive that specifies minimum rest periods and a maximum 48-hour working week - adopt a broader definition of 'worker'. Likewise, the proposed national minimum wage exceeds the narrow interpretation of 'employee'. However, blurring that distinction could prove problematic and many contractors will resist the resulting loss of their taxation benefits.
When it comes to collective rights and trade union recognition, the government does not propose to change most of the trade union reforms of the 1980s.
For example, the closed shop is gone for good.
But the government may allow employees to have a trade union recognised by their employer where the majority of the workforce wants it - that is, where at least 40 per cent of those eligible to vote are in favour of a union. Such recognition would cover pay, hours and holiday as a minimum.
The jury is still out as to whether or not it will also include training.
Statutory procedures for both recognition and derecognition will be reintroduced. The proposed recognition procedure will give each stage a time limit. If disputes arise, the Central Arbitration Committee (CAC) will deal with the issue of whether there is reasonable support for recognition, and the appropriate bargaining unit - in other words, whether it is one site or more, or a part of the workforce. There will be a similar procedure for derecognition.
New recognition and derecognition applications to the CAC will be allowed only after three years, to prevent frivolous applications and constant applications leading to a running dispute between employer and unions.
Where more than half the workforce are trade union members, recognition will be automatic; the argument is that membership demonstrates a wish for recognition. And companies with 20 or fewer employees will be exempt - a lower threshold than the 50 employees sought by the CBI.
The government also proposes changing the law so that those dismissed for taking part in official industrial action have the right to complain of unfair dismissal to a tribunal. The aim of the clause would be to prevent wholesale dismissal of strikers.
In these circumstances, there will still be options such as withholding payment for non-performance, but if anyone other than temporary employees take over the role, it will be a case of constructive dismissal. Whether this will prove beneficial or more inflammatory, since hiring temporary workers will still be engaging 'scab' labour, remains to be seen.
The government also proposes to make it unlawful to discriminate by omission on grounds of trade union membership or activities. This will outlaw different pay and remuneration structures, for example preventing pay increases for non-membership of the union.
The government will also amend the law on giving notice of industrial action: while the union will still provide notice to the employer to identify the group of employees concerned, it need not give names. This will make it more difficult for employers to take counter measures.
Employees will also be given a legal right to be accompanied by a fellow employee or trade union representative during grievance and disciplinary procedures.
The government is also anxious to bring in measures that will help employees find a better balance between career and family responsibilities. Proposed family-friendly policies include extending maternity leave to 18 weeks; and giving employees rights to extended maternity absence - 29 weeks rather than 14 weeks - and three months' parental leave after just one year's service.
These measures are in keeping with the lower one-year threshold for triggering employment protection rights in general.
Stricter guidelines for extended maternity or paternity leave will end the uncertainty and legal arguments as to whether the contract continues or is suspended during such leave and whether notice provisions are necessary to keep the contract alive.
Providing similar rights for employees taking parental leave as well as maternity absence prevents discriminatory treatment and ensures there is a right to return to work. It will also include providing three months' parental leave for adoptive parents, providing reasonable time off for 'family emergencies'. This will be applicable to all employees regardless of their length of service.
It remains to be seen how an employer's interest in work continuing and an employee's request for such time off will be balanced. The proposals also aim to protect employees against dismissal or detrimental treatment short of dismissal, if they exercise their rights to parental leave and time off for urgent family reasons.
In conjunction with this set of proposed changes, the government is also inviting comments on a number of related issues. First, it is keen to look at ways of simplifying the unnecessarily complicated notice requirements for taking maternity leave.
Second, it is addressing the issue of whether parental leave should be flexible or taken in one block. Third, it is looking at whether small firms might face particular difficulties in complying with the Parental Leave Directive.
It is difficult to see how any employer could remain unaffected by these proposed changes. The family-friendly policies are largely a development of existing legislation, although they will have an obvious cost consequence.
More dramatic is the extension of unfair dismissal protection, which is in danger of provoking considerable numbers of additional claims.
But the burning question is whether the reintroduction of collective rights at work will lead to partnership or discord and whether the government can enforce that employees gain their rights.
VIEW FROM THE CHANNEL
A representative for Dixons Stores Group is untroubled by the government's proposals.
He says: 'The White Paper does not cause us any real concern. We are committed to quality communications and we always negotiate with our staff.
'We have had trade unions in the business for more than 30 years and we are happy to co-operate with them. However, historically, there has not been any widespread interest in joining unions and union membership has been limited to parts of the business, such as the service engineering department.
'As for the change in unfair dismissal rights (down from two years to one), we don't anticipate this causing us problems. We aim to manage our staff from the start: we get the right people, we give them a proper induction, and we manage their performance while offering training and opportunities. Any problems are found within the first year.'
Mark Mulford, chief executive of distributor Datrontech, has minor reservations about the changes. 'Our values and ethics are such that we would not fall foul of the proposals, but there are potential dangers.
I would hate to get more and more legislation that protects staff only for it to be used to make businesses unmanageable as staff push their rights to the letter of the law, not the spirit. In other words, we should not legislate mediocrity. I have no problem in principle with the government's proposals. We are a young company which is not unionised but has some staff turnover.
'Our greatest costs in relation to the hiring of employees are in the mistakes we make when we hire. If we hire someone and a problem appears, we persevere, but we may have to part company. I'm not interested in hiring and firing - our culture is open, fair and reasonable - and whether we parted company after one or two years, we would show staff the same courtesy.'
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