Further Changes to Employment Law - October 2013

By Alastair Dawson, Access 2 Barristers Direct

November 8 2013 - 2013 has been a significant year where changes to employment law and tribunal rules are concerned; but the change is still on-going. October brought further amendments to the law regarding executive pay, national minimum wage, third party harassment provisions and pension protection from TUPE. Each of these changes has been proposed by the Enterprise and Regulatory Reform Act 2013 and the Employment Tribunal (Constitution and Rules of Procedure) Regulations 2013.

These changes were set in place as of the 1st of October 2013. The changes focus on reforming the system in relation to the rising expenses of the Employment Tribunal system. In addition to reducing the costs of the Employment Tribunal system the changes to the Employment Law will also highlight the importance of developing an efficient system and will aspire to do so.

Further changes to Employment Law

• Control Over Executive Pay

  For many years there has been a large amount of speculation on the way that members of the government, media and the leaders of various organisations are rewarded for their executive roles. Due to this the department for Business, Innovation and Skills (BIS) have proposed several changes to executive pay in their legislation.

  To allow society a larger measure of control the shareholders of each company will be given a binding vote on board pay. This means that the shareholders will make the decision as to how much they believe the executives should be paid aside from their annual salary.

  If an executive such as a director of a company approves of a payment without the permission of the shareholders they will be held responsible for their actions and will face consequences for doing so.

  The purpose of these changes is to strengthen communications between shareholders and companies and to establish a transparency for board pay.

• Increase in National Minimum Wage

  Due to growing concerns over the current recession and the inflation of prices worldwide it has been decided that there will be an increase in national minimum wage. The increase will be of 12p per hour; raising the minimum wage to £6.31 per hour.

• Dismissal of Third Party Harassment Provisions

  The Third Party Harassment Provisions have been revoked as they have been found unnecessary by the Government.

  Although the Third Party Harassment Provisions have been revoked as of the 1st of October 2013; this does not mean that companies will not be held responsible for acts of harassment by third parties that occur after this date. Employees can still claim against acts of harassment through third parties; the difference is that the employee has to claim in a different way.

  An example of this would be if an employer were to ignore or fail to address the difficulties that an employee may be facing. This gross neglect by the employer could lead to a case of harassment or constructive unfair dismissal.

• Amendment to Pension Protection from TUPE

  The government proposed an amendment to the wording of the 2005 regulations and are going ahead with it as they believe that it does not reflect the intention of the policy clearly and unambiguously. The original policy intended for the employee to have the right to choose the amount that they would like to contribute to their pension scheme. This contribution would then be matched by the employer up to a maximum of 6% of the employee's basic pay.

  The amendments that have been made as of the 1st of October allow the transferee to make contributions to the pension scheme that matches the payments that are made by the transferor for the appropriate employee immediately before the transfer has taken place.

Laws and legislations are changing continuously in order to aid business owners, companies and society in general. By adapting the laws we can reflect the changes in our environment and maintain order within society; amending and abolishing laws where appropriate can also prevent problems in the future.

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