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ERR – what does it change?

The aim of the Enterprise and Regulatory Reform Act (ERR) is to instigate greater efficiency, clarity and effectiveness into employment law. Some changes are already underway.

Reform to the tribunal system

The ERR aims to improve the employment tribunal system.

  • Tribunal judges will be able to sit alone unless otherwise ordered. Whilst concerns have been raised about the removal of lay personnel, the provision is intended to drive greater efficiency into the tribunal system.
  • The unfair dismissal qualifying period is removed where dismissal is based on the employee’s political opinions or affiliation.
  • The Secretary of State will have the power to alter the statutory upper limit on the compensatory award in unfair dismissal claims. Currently, a draft order plans to set the new limit to the lower of either the current cap (£74,200) or one year’s gross pay of the claimant.

Changes in the law on whistleblowing

The ERR also contains new provisions concerning the law on whistleblowing. Whistleblowing is when a worker reports suspected wrongdoing at work.

The first change is in relation to the definition of “qualifying disclosure”. Workers will now only be protected where the disclosure is “in the public interest”. This public interest test will apply to all the categories of protected disclosure.

Other key changes relate to the requirement for disclosure to be made in “good faith”. This requirement has been removed, a move which may be intended to counteract the “public interest” requirement above. It is also worth noting that a reduction in compensation is provided for if a disclosure is not made in good faith which offers a safety net, although a limited one, for employers.

The reforms detailed above are set to be implemented today (25 June 2013). However the remainder of 2013 and even into 2014 will see further substantial changes including reforms in relation to pre termination negotiations, financial penalties for employers that are unsuccessful at tribunal and Acas mandatory early conciliation. We will keep you posted…

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Legal news, views, trends and tools for HR Professionals. Stay ahead. Go further