The second act

The Government's latest piece of employment legislation has now had time to gear up, but still awaits clarifying regulations. Charlotte Hamer gives a guide to the Employment Act 2002


The Employment Act 2002 (the act) received Royal Assent on 8 July 2002. While not the first significant piece of legislation under Labour – that title belongs to the Employment Relations Act 1999 – it will significantly affect the employment relationship. Also, like the 1999 act, it will come into force piecemeal, as many of its provisions require secondary regulations before being fully implemented.
The reliance on regulations makes it difficult at this stage to assess the full impact of the provisions, but nevertheless a number of important issues are thrown up.

Part 1: statutory leave and pay
This introduces new rights for fathers and those adopting children and extends maternity leave. The notice periods, including those for parental leave, are also harmonised.
The act further simplifies the confusing set of maternity regulations. The new regulations also assume that women will take their full entitlement unless the employer is otherwise notified.
The maternity and paternity leave provisions apply where the expected week of childbirth (EWC) begins on or after 6 April 2003. If, however, a child is born on or after that date but with an earlier EWC, only paternity leave applies. Adoption leave (full maternity and paternity leave) is available where notification of a match takes place on or after 6 April 2003, or the child was placed on or after that date. Adoption leave only applies to new adoptions and not, for example, where a step-parent adopts a partner's child. Special provisions apply if an adopted child dies or the adoption fails for any reason.
Adoption leave could be open to abuse because, as either parent may take it, both employees may take it without their partner's employer being aware.

Part 2: tribunal reform
The most interesting are the proposed reforms to the costs rules and the changes to conciliation. The existing tribunal rules will require amendments, but these could include ordering representatives to pay costs or have their own disallowed because of their conduct at the proceedings. Tribunals may also prescribe a limited period within which conciliation should be conducted.
Costs orders could also include a party's non-legal preparation time costs, although only in the employment tribunal. A requirement to assess a party's ability to pay costs could also be introduced.

Part 3: dispute resolution
Only the regulations will allow a full assessment of the true impact of these nevertheless significant changes.
Statutory disciplinary and grievance procedures will be implied into contracts of employment and may only be enhanced by the employer. Confusingly, the act sets out a standard and a modified procedure for each. The former largely reflect the Acas code, but the latter procedure appears to presume that the employer has already decided to dismiss prior to using the procedure, and the modified grievance procedure has no provision for an appeal. Regulations will hopefully shed some light on which to use and when.
Failing to follow a contractual disciplinary procedure could amount to a wrongful dismissal, if not an automatically unfair dismissal. However, if any contractual elements of the disciplinary procedure are not followed, the dismissal may not be unfair if the employer would have dismissed the employee in any event and such a dismissal would have been fair.
The statutory procedures will also significantly affect employees: before bringing a specified claim, including for discrimination, employees must have raised a grievance in accordance with the procedure within a set period; if not, the tribunal could refuse to hear the claim. Additionally, 28 days must have elapsed after a grievance has been raised before a tribunal claim is brought. Consequently, time limits may also be amended.
Particulars of employment must contain the statutory procedures, and small employers are no longer exempt. A claim for a failure to provide the particulars may only be a parasitic claim and not a standalone one.
The remedies under this part are confusing and the provisions are littered with “just and equitable” and other exceptions. A late amendment by the House of Lords changed the compensation for failing to provide employment particulars. The statutory limits for a week's pay, maximum awards and qualifying service provisions remain.

Part 4: miscellaneous
Despite the heading, this part also contains important changes, including the introduction of equal pay questionnaires, similar to other discrimination claims, and the right for employees to request a permanent variation to their contract to allow them to work flexibly so as to care for their child.
Interesting times lie ahead.
Charlotte Hamer is a professional support lawyer in the employment, pension and benefits department of Stephenson Harwood

Statutory leave

Maternity leave
•Ordinary maternity leave (OML) – 26 weeks paid at 90 per cent earnings for first six weeks, plus 20 weeks standard maternity pay (SMP) (from April 2003, the lesser of £100 per week or 90 per cent of earnings).
•Additional maternity leave (AML) – 26 weeks unpaid, commencing day after OML ends.
•Qualify for AML after 26 weeks continuous employment by fifteenth week before the expected week of childbirth (EWC).
•OML triggered for pregnancy-related illness four weeks or less before EWC.
Paternity leave
•Father expects responsibility for child's upbringing and must be either the biological father or mother's husband or partner.
•Two weeks paid at SMP.
•Must be taken within 56 days of birth or expected date of birth, whichever is later, and taken consecutively or in two separate weekly periods.
Adoption leave
•26 weeks paid at SMP plus 26 weeks unpaid.
•Qualification is 26 weeks employment by the week in which the match is notified.
•Either parent may take this leave as well as the other paternity leave.
Notice periods
•15 weeks before EWC for notification of intention to take maternity or paternity leave for birth children with prescribed information, including date leave is to start.
•Within seven days of being informed of the match for adoption leave (either kind).
•28 days is the minimum notice required to:
(i) change the date on which leave is being taken;
(ii) request parental leave (unless the child is disabled, in which case it remains at 21 days);
(iii) give notice of when maternity, paternity or adoption pay starts;
(iv) give notice of early return from OML or AML.


Flexible working

Employees must:
•Have 26 weeks continuous employment and a child under six (or 18 if disabled).
•Apply no later than two weeks before the sixth (or eighteenth) birthday.
•Have/expect to have responsibility for the child's upbringing.
•Apply for the variation to care for the child.
•Not be exempted.
Any refusal must be:
•Reasonable in all the circumstances.
•For one of the prescribed reasons.
Remedies:
•Compensation.
•Dismissal for requesting the change is automatically unfair and employees may not suffer a detriment.


Remedies

•Employer wholly/mainly fails to complete statutory disciplinary procedure = automatic unfair dismissal plus minimum four weeks pay award.
•Either procedure not completed before proceedings begun wholly/mainly because of employer/employee = award increased/decreased by 10 per cent or less, or anything up to 50 per cent if appropriate.
•Failure to provide employment particulars = two to four weeks pay.