Autumn statement: employment law changes

By: Georgina Harris

Date: 8 December 2011

So after November’s Autumn Statement, HR law for employers has changed. Again. As have pension rules. In very brief, here’s what you need to know and do now, plus advance warning on key dates for your 2012 diary 

Unfair dismissal qualifying period to rise

Currently, employees can usually only bring a claim for unfair dismissal if they have been continuously employed for one year at the time their job is terminated. As from 6 April 2012, the Government has announced the qualifying period will, in most cases, double to two years.

What do firms have to do?

Nothing immediately. But bear in mind that some HR experts have warned that firms might see a rise in claims that don’t rely on unfair dismissal, such as equality and discrimination protection that employees have as Day One rights in any job. Make sure your equality policies are up to date and that everyone understands and follows them.

Compulsory pension schemes delayed for small firms

Firms with fewer than 50 employees will not have to start enrolling staff in new ‘automatic enrolment’ pension schemes (into which both employee and employer must pay monthly) until May 2015. The smallest firms will get until 1 February 2016 to enrol. The original start date for smaller firms was April 2014.

But the whole scheme will begin on time in autumn 2012 and all employers must still join it at some point. The larger the firm, the earlier the start date – firms with 50-plus staff will have to be enrolled by mid-2014.

What do firms have to do?

New staging dates for small firms will be announced in January 2012. In the meantime, however, work out how many of your staff must be enrolled. Start budgeting for payments and admin costs for your firm. Look at your existing pension arrangements to see if they can be adapted for all employees, and if necessary start considering new schemes that fill official criteria. Ask yourself if your payroll and HR provisions can cope, and get ready for questions from employees. Stay aware of changes to the state pension age, too – this will rise to 67 in 2026 (not in the 2030s as planned).

Don’t forget these two for your diary….

2012 Diamond Jubilee gives UK businesses extra bank holiday

An extra bank holiday will take place on Tuesday 5 June 2012, with the late May bank holiday moving forward to Monday 4 June.

What do firms have to do?

Check employment contracts to work out if you need to pay staff for the extra day off. Workers are not automatically entitled to be paid for the extra day unless their contract says so, as bank holidays can be included in the statutory paid holiday entitlement of 5.6 weeks’ (28 days’) paid annual leave for full-time workers.

But it depends on the wording of the employment contract – for example, if employees’ contracts state that they are due paid holidays including all bank holidays – eg “20 days’ holiday plus bank holidays” - they should be paid for the extra day.

Small business rate relief holiday extended to April 2013

From 1 October 2012, businesses will have the opportunity to defer 60 per cent of the increase amount of their 2012-13 business rate bills. The extra can be repaid equally across the following two years.

What do firms have to do?

Apply for the deferral when your rates bill arrives next year.

What does the * mean?

If a link has a * this means it is an affiliate link. To find out more, see our FAQs.