Unfair dismissal plans: Blueprint for bias

See an article below I contributed to...

27 October 2011

The suggestion that scrapping unfair dismissal rules would create jobs and promote growth made in a report to Downing Street by the venture capitalist Adrian Beecroft is effectively a further ploy to remove ordinary workers' rights and a blueprint for discrimination, Richard Macmillan, a solicitor in the employment team at law firm Russell Jones and Walker, has told publicservice.co.uk.

It would also be unlikely that the changes would have the desired effect of boosting economic growth, he said, dismissing Beecroft's argument that employment laws impede "the search for efficiency and competitiveness" and that British organisations are deterred from taking on employees due to the labour laws in this country.

"There is no evidence that enhancing employment rights leads to economic decline or higher unemployment," Macmillan said. "For example, the qualifying period for unfair dismissal claims was changed to one year from two in 1999, and unemployment actually fell in the years that followed. Neither is there any evidence that productivity would be increased by doing away with unfair dismissal claims. Germany has wider labour laws than Britain, but productivity levels are higher. The United States' economic problems are also severe, despite lesser levels of regulation governing its labour market in comparison with our own “ suggesting Mr Beecroft's conclusions are misguided."

Macmillan went on: "Public sector employees in particular would be hit hard if this recommendation became law. At a time when job security is at extremely low levels, the removal of employees' dismissal rights would be a further blow to staff who already harbour concerns over the safety of their jobs as cuts are progressed through a whole range of public sector organisations.

"In my experience, cases end up in the tribunal because managers have failed to address performance issues early enough, leaving problems to fester. There is free ACAS guidance available to all employers so lack of guidance is not a reason to avoid a reasonable procedure. This ultimately leads to a breakdown in working relationships and tribunal claims. Employers can already dismiss employees easily in the first year of employment without worrying about possible claims unless discrimination or whistleblowing is involved. Even if an employee has not accrued unfair dismissal rights, all the law requires is for an employer to act reasonably in the circumstances, which does not necessarily mean a lengthy and onerous process. It is right that a duty on employers to act reasonably exists when someone could potentially lose their livelihood and income as a result of the employer's decision.

"The reality is that a fair balance already exists between the needs of employers and the individual rights of employees. It seems that Mr Beecroft would prefer to limit the rights and empowerment of workers, instead of looking at how we address poor management and other efficiencies within organisations, which could be the real engine for growth and productivity."

And this part came from another author....

However, whether the proposals come to fruition remains to be seen and businesses shouldn't get over excited by them, according to Michael Slade, Managing Director of employment law specialist Bibby Consulting & Support.

"We support any initiative that helps businesses overcome the burden of protracted and costly processes, especially in the current economic climate," Slade said. "But it is wrong to overstate that companies would benefit financially from the unfair dismissal rule being abolished due to reduced compensation levels."

Pointing out that the government had already agreed that from April 2012 the service period for an employee to be able to claim unfair dismissal would be extended to two years, Slade added: "There still remains a substantial amount of anti-discrimination legislation under the Equality Act 2010. So should employees feel their treatment was unfair and attribute it to a 'protected characteristic' under the Act, they would benefit from protection that could attract costly uncapped awards at employment tribunals."