Employment Rights Bill – proposed amendments

The Government has published some proposed changes to the Employment Rights Bill which are important, but not necessarily that surprising.

Time Limits

It is proposed to amend the bill to extend time limits for all claims in the Employment Tribunal from 3 to 6 months after the alleged act.

The Labour Party had already indicated a desire to increase employment tribunal limitation periods from 3 to 6 months and it was a little surprising that this was not in the original version of the Employment Rights Bill. There has been concern over the years that the 3 month time limit is too strict, particularly in discrimination claims where it can take time for issues to be raised and for internal grievance processes to conclude. It is of note that the proposed amendment increases the time limit for all Employment Tribunal claims to 6 months and not just discrimination claims.  

Probationary period length

The amendments also offer a little more guidance on what an appropriate probationary period might look like in the new world of Day One unfair dismissal rights. The “Initial Period of Employment”, is a period during which the full “Day One” protection against unfair dismissal will not apply. The Government had said that its preference was for 9 months, but that this issue would be the subject of consultation. A Liberal Democrat MP has proposed an amendment to the bill to state that this Initial Period will be between 3 and 9 months.  

A further amendment is proposed by the Government to clarify that the Bill will enable the Secretary of State to specify the maximum unfair dismissal award for someone dismissed during this Initial Period of Employment. The original bill was very quiet on what exact protection would be available to employees during the Initial Period of Employment and this amendment crystallises the option of the Government introducing a lower maximum award for those unfairly dismissed during this Initial Period. At the moment, the maximum award for unfair dismissal is a year’s pay (up to £115,115). 

Whilst “Day One” unfair dismissal rights were one of the main headlines from the Employment Rights Bill when it was first published, there remained a lot of uncertainty. Whilst not offering clarity, these two amendments show that the legislation could have a significantly different impact on the approach of employers and the impact on the job market depending on the approaches to these two issues of the length of the Initial Period and the compensation available: for example, a 9 month Initial Period with a maximum award of 25% of a year’s pay looks relatively employer friendly, whereas a 3 month Initial Period with a maximum award of 75% of a year’s pay would be much more employee friendly.  

Equality Action Plans

Another proposed amendment that has received attention relates to Equality Action Plans that will be required to be published by large employers (those with more than 250 employees). The original bill stated that these would have to include addressing actions being taken by the employer to address the gender pay gap and support employees going through the menopause. There is now a proposal to extend this to what the employer is doing to support employees with menstrual problems and menstrual disorders. This is an issue already on the agenda of some employers and these proposed amendments may result in more employers considering these issues even before any formal changes to the law under the Employment Rights Bill.