Labour Research May 2012

Law Matters

Coalition consults on sacking

The coalition government is proposing to make it easier for employers with small workforces to sack workers.

Its latest proposals to downgrade employment rights for workers are set out in Dealing with dismissal and ‘compensated no fault dismissal’ for micro businesses. The document is a “call for evidence”, meaning that the proposals are still at a formative stage.

By publishing the call for evidence, the government is making it clear that it wants to make it easier and cheaper for micro-businesses (those with less than 10 workers) to sack people more easily, without following a procedure and without giving a reason.

However, making it easier to sack people seems an odd way of tackling unemployment of 2.7 million.

The government believes that it can protect micro-employers from having to deal with most types of unfair dismissal claims. Nevertheless, individuals will still be able to bring discrimination cases irrespective of their length of service.

The government is seeking views on how such a compensated no fault dismissal scheme would operate. It has, for example, asked whether a simplified procedure need be set out in legislation or in the Acas Code of practice on discipline and grievance, and whether the level of compensation should be a flat rate, or a payment based on an individual’s wages.

The government is seeking responses by 8 June.