The Business Secretary, Vince Cable, has today announced the start of consultation into proposed changes to Employment Tribunals. News coverage has predominantly focussed 2 things:
- reducing the statutory cap on compensation
- the introduction of “settlement agreements”
The BBC website describes a settlement agreement as a document “in which staff agree to leave without being able to go to a tribunal, but get a pay-off in return.” This may sound familiar to employers and employees alike, who are already familiar with the compromise agreement, a mainstay of employment for many years.
What is actually being proposed is the relaxation of “without prejudice” discussions in straightforward dismissals to enable employers to negotiate settlement agreements, without a Tribunal being told of those negotiations. Under the proposals, negotiations that stray into discrimination will still be admissible, as is the case now.
The proposal is intended to give employers a little more peace of mind where they want to sit the employee down and give them a choice between a dignified departure and a possibly lengthy performance improvement programme.
Contact us for more information on how the proposed changes could affect you.