Reductions in force/collective redundancies

The Implied Term of Mutual Trust and Confidence and an Employer's Compliance with Its Own Policies

By Ben Dudley, Partner, and Adam Lambert, Solicitor, Sydney.

The Federal Court has recently handed down a decision which found that a 'serious' breach of a redundancy policy by an employer amounted to a breach of the implied term of mutual trust and confidence, even though the relevant policy was expressly excluded from being incorporated into the contract of employment.

Employers will need to carefully review and consider the interaction between their policies and contracts of employment.

Employers should consider taking advice on steps available to minimise risks in this area, including by careful drafting of relevant policy and contractual documents.

Read the full post here.

Collective Redundancy Consultation Obligations to be Relaxed

By Madeleine Jephcott

JobLossII.jpgThe Government is proposing to reduce the UK's 90-day minimum consultation period for large-scale redundancies.

While the rules governing collective redundancy consultation have remained relatively unchanged since they were introduced in the mid-1970s, the same cannot be said for the UK labour market. In an increasingly global and competitive market, the Government sees the existing redundancy consultation scheme as a barrier to competitiveness, flexibility and growth.

As a result, the Department for Business, Innovation and Skills (BIS) has published a consultation document suggesting some changes to the legislation. (This follows an earlier call for evidence on the operation of the rules, which closed in January this year.) The main proposals are:

  • reducing the 90-day minimum consultation period for large-scale redundancies; and
  • introducing a new Code of Practice to address a number of key issues affecting redundancy consultations.

Reducing the Consultation Period

Currently, employers must consult with trade unions or employee representatives for a minimum of 30 days before the first redundancy dismissal takes effect when proposing to dismiss between 20-99 employees, and for a minimum of 90 days when proposing to dismiss 100 or more. The EU Collective Redundancies Directive does not prescribe minimum consultation periods and the Government regards the time periods in the UK legislation as unacceptable "gold plating".

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Collective Redundancies in France Not Void for Lack of Economic Grounds

By Kaela Ji Eun KIM

A significant ruling of the French Supreme Court (Cass. soc , May 3, 2012, No. 11-20741) has reaffirmed that Works Councils cannot challenge collective redundancies for lack of economic grounds.

French law provides that, where a collective redundancy exercise involves ten or more employees, the employer must develop and implement a social plan. This must offer affected employees assistance in finding a new position and include a sufficient variety of services, such as training and outplacement. In cases where an employer's plan does not meet the legal requirements, the Works Council can bring proceedings to nullify it and effectively stop the redundancy procedure.

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UK Employment Law Reforms - Latest Developments

By Madeleine Jephcott

Changes SignII.jpgIn the weeks since our previous review, in April, of recent and forthcoming legal changes affecting UK workplaces, the detail of some of the Government's reform plans has become a little clearer and some novel proposals have emerged.

The Queen's Speech

The Queen's Speech on 9 May 2012 heralded two bills that will overhaul significant aspects of employment law - the Children and Families Bill and the Enterprise and Regulatory Reform Bill.

The Children and Families Bill - not yet published - will include some of the reforms mooted in last year's Modern Workplaces consultation, although possibly not all of them. The Government's formal response to the consultation is expected shortly. The most significant proposals were:

  • A new system of flexible parental leave, designed to give parents more choice about sharing childcare responsibilities in the early stages of as child's life. In outline, the scheme is likely to entail the mother taking 18 weeks' leave at or around the birth, with the remainder of the current 52-week maternity leave period being reclassified as "parental leave" to be taken flexibly by either parent.
  • Extending the right to request flexible working to all workers who have been employed for 26 weeks, irrespective of the reason for the request. This would be based on the existing system for requesting flexible working for children/adult carers, retaining the current list of eight business reasons for employers turning down a request.
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What's New in Employment Law This April and Beyond?

By Richard Lister

BarometerII.jpgIt is official policy in the UK for most changes to employment legislation to take effect in either April or October each year. This article summarises both the reforms coming into force this month and the major Government proposals for the future currently stacked up in the pipeline.

The most noteworthy changes being implemented in April 2012 are as follows:

Unfair Dismissal Qualifying Period

In a highly controversial reform that was confirmed by the Government last October, the period of employment before an employee qualifies for the right to claim unfair dismissal has increased from one to two years. This applies only to employees who start a new job on or after April 6, 2012: employees already in employment on that date retain the one-year qualifying period.

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Major Employment Law Shake-up Unveiled

By Richard Lister

Changes SignII.jpgThe UK Government has announced wide-ranging plans for what it claims to be "the most radical reform to the employment law system for decades". The proposals were set out by the Secretary of State for Business, Dr Vince Cable, in a speech to the EEF manufacturers' organization. Some of the measures had been previously floated but others were novel, including:

  • amending the UK's whistleblowing legislation so that complaints by employees about a breach of their own employment contract will no longer constitute a protected disclosure;
  • seeking views on introducing compensated no-fault dismissals for "micro employers" with fewer than ten employees;
  • simplifying and "slimming down" the processes required to carry out a fair dismissal, including potentially working with the conciliation service Acas to change their Code of Practice on Disciplinary and Grievance Procedures;
  • consolidating the myriad regulations relating to the national minimum wage; and
  • streamlining the current regulatory regime for the recruitment sector.
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Government Signals New Employment Law Reforms

By Richard Lister

Parliament & Big BenThe UK's Coalition Government has announced that it will be extending its review of employment law to cover three new areas. This forms part of a broader strategy to simplify legislation, improve efficiency and reduce business red tape. The latest announcement follows a recent major consultation on proposals to reform employment tribunal and resolution of workplace disputes, including extending the qualifying period for claiming unfair dismissal from one year to two years.

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Huge Increase in Employment Tribunal Claims

YouAreFiredIII.jpgThe latest annual statistics (PDF) published by the UK's Tribunals Service have revealed a very significant increase in claims received by Employment Tribunals, which are now at their highest ever level. The number of claims in 2009-10 rose to 236,100, representing a 56% increase on the number of claims lodged in 2008-9. However, the report suggests that this is largely attributable to a rise in the number of multiple claims (i.e. arising out of the same or similar circumstances).

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Consultations Before Decision by Parent Company

A consultation of collective redundancy with works council must be held before a decision is taken, even if the decision is not taken by the employer, but by the group. This rule follows from Art. 2 Sec. 4 of the Directive on collective redundancies. It has been recently referred to by the European Court of Justice in the Akavan v. Fujitsu Siemens case (C-44/08).

New Rules Concerning Employee Redeployment in the Event of Lay-offs

The French parliament recently approved a law which aims at guaranteeing fair conditions of remuneration to employees concerned by a lay-off procedure.

Since 1995, the French Supreme Court has imposed on employers a general obligation to offer redeployment before making any employee redundant. This obligation was incorporated into the French Labour Code in 2002.

The French Supreme Court ("Cour de cassation") ruled that the employer has to search for and propose any vacant position within the same Group, among all the entities whose activities, organization and localization permit the employees to be made redundant to switch.

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