As part of its review of employment law, the Government has issued a Call for Evidence on the introduction of the concept that small employers will have the right to dismiss employees without cause, provided they make a statutory payment to the employee. It is suggested that this might be the equivalent of statutory redundancy pay.
For this purpose, it is proposed that small employers will be those with fewer than 10 employees. If this change is introduced, it is estimated that 21% of employees in Great Britain will be affected.
The stated purpose is to give small businesses the confidence to recruit staff without the fear of being sued if they then dismiss them. However, discrimination will not be covered by this, so if this is introduced one likely unintended consequence is that disgruntled employees will seek to bring discrimination claims if they are dismissed without cause.
In addition, the Call for Evidence is asking for views on whether the ACAS Code of Practice on Discipline and Grievance could be made more accessible and easier to use by smaller businesses. The suggestion is that we could adopt a similar system to that in Australia, where they have the Small Business Fair Dismissal Code, a copy of which can be viewed here.
There has also been suggestion recently in the Telegraph that the Government are considering exempting small businesses from providing certain family-friendly rights to their employees. At this stage there is nothing to confirm that this is a serious consideration.
The call for evidence closes on 8 June 2012. We will of course keep you updated as soon as there is any news on whether these proposals are being taken further.
For advice on this or any other aspect of employment law, please contact any member of the Pure Employment Law team on 01243 836840 or [email protected].