Vince Cable’s employment reforms will ‘put pressure’ on arbitration service

Employment lawyers have generally welcomed business secretary Vince Cable’s new employment law measures but are sceptical about areas such as the reform of the tribunal system.

Richard Fox
Richard Fox

Cable outlined plans to overhaul employment tribunals that would result in all claims initially going to the Advisory, Conciliation and Arbitration Service (ACAS) before reaching the employment tribunal and a “rapid resolution scheme” for simpler cases to be settled within three months.

Commenting on the ACAS proposal, Kingsley Napley employment head Richard Fox said that there needed to be more clarity surrounding the mooted reforms.

“ACAS, just like any other Government body, is under great financial pressure,” he said. “If they’re going to have a considerably enhanced role, they’re going to need to be adequately resourced. Unfortunately, we have seen no commitment in that respect thus far.”

Ashurst head of employment Caroline Carter believes that employers will welcome reform of the tribunal system and the introduction of tribunal claim fees, but feels that too much pressure will be placed on ACAS.

She added that the highlighted measures would give employers greater flexibility and speed to deal with employee issues.  

Other measures put forward by the business secretary include the introduction of ’protected conversations’, which will allow employers to discuss an employee’s poor performance without fear of being taken to a tribunal.

Harbottle & Lewis employment head Howard Hymanson commented: “If this ’protected conversation’ actually finds its way on to the statute books, it will not help employers in many instances to bring about an effective, pain free exiting of an unwanted employee.

“What we’ll actually get is simply another recipe for disaster, very much in keeping with the last government’s failed statutory dispute resolution procedures.”

Announcing his consultation this morning, Cable said that the proposals are aimed at making it easier for employers to take on new staff. 

The Government believes that cutting the cost and bureaucracy of laying off workers will help businesses to remain profitable through the economic downturn.

Cable said that a balance needed to be found between good employment rights for workers and creating an environment for “small companies in particular” which would encourage growth and expansion.

Among the most controversial of the plans is the scrapping of unfair dismissal laws and allowing employers to sack unproductive workers.

The proposed move was first aired in last month’s leaked Beecroft report and was slammed by employment lawyers (26 October 2011).