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Queen’s speech 2012 highlights employment law changes

This year’s Queen’s speech outlined the Government’s legislative programme for 2012 -2013.

The Speech included a lot of proposed changes relating to business and employment law.

In essence, the key proposals for employment law changes were four-fold:

Reforming the Employment Tribunal system

The Enterprise and Regulatory Reform Bill will look to improve the efficiency of the Tribunal system through measures designed to increase flexibility and encourage employer compliance. In particular, it is expected to allow for early resolution of employment disputes through Acas, the renaming of compromise agreements to “settlement agreements” and improving the Employment Tribunal system by “increasing flexibility and encouraging employer compliance”. It is not yet clear exactly how the latter will be achieved, but it may partly allude to the introduction of a system of financial penalties for unsuccessful companies.

Increasing shareholders’ power to control executive pay

The Enterprise and Regulatory Reform Bill will also give shareholders a binding vote on directors’ pay and on any exit packages of over one year’s basic salary. The aim of these changes is to bring director’s pay deals in line with, and conditional upon, their ability to ensure continued business success.

Increasing employers’ confidence to hire new staff by reducing regulatory burdens

Under the planned Enterprise and Regulatory Reform Bill, the Government will aim to assist economic recovery by reducing the regulatory burdens on employers that have undermined their confidence in recruiting new staff. It is not clear exactly how the Government plan to do this, and so we await further details on this from the Government.

Giving parents greater flexibility through shared parental leave

Parents will be given greater flexibility in sharing the responsibility of caring for their children through the Children and Families Bill. This will enable mothers wishing to return to work earlier the chance to transfer their maternity leave to the father.
The default length of maternity leave is expected to be reduced from 26 to 18 weeks, whilst the remaining entitlement of up to 34 weeks will be shared between both partners.

Although not expressly mentioned in the Queen’s speech, the Children and Families Bill is also expected to expand the current flexible working arrangements and give all employees with 26 week’s continuous employment the right to request flexible working.

We will, of course, continue to provide you with updates in relation to these proposals as and when they may crystallise.

For a confidential chat on any of these changes or for help putting together employment policies and procedures call 01332 226 149.

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