Welcome to this month's briefing for HR teams and in-house employment counsel – bringing you this month’s employment law highlights in an easy-to-read package.
We’re going to focus this month on the new Employment Rights Act, passed at the end of last year. We have already flagged some of the most significant changes introduced by the Act, but it makes sense to set out an overview of the headlines (the Act runs to 160 sections and 12 schedules) and the anticipated start dates. Much of the legislation is extremely complex, and much of the detail will come down the line in further regulations. The full effect of the Act in some areas is therefore hard to judge with any degree of certainty. In other areas however, especially unfair dismissal, the impact is obvious and dramatic.
Unfair dismissal
By far the biggest change is the scrapping of the compensation cap that has been part of the unfair dismissal regime since its invention more than 50 years ago. The cap will cease to exist for dismissals from (likely) 1 January 2027 onwards. At the same time, the qualifying service period will be cut from two years to six months, significantly shortening the period in which employers can be (a little) more relaxed about the termination procedures they adopt. The existence of the compensation cap has always been a key factor in the high volume of claims in which either discrimination or whistleblowing is alleged, as those types of claims carry potentially...
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