There is a softening proposed here.
Clause 26 of the draft Bill contains a ban on dismissing an employee for refusing to agree to a contract variation.
This proposed to add a new section 104I to the Employment Rights Act 1996 and any dismissal was to be automatically unfair unless (i) the change was essential to avert calamitous financial distress and (ii) the employer had broadly observed a six-point consultation list.
The ban on fire and rehire will now only cover restricted variations not any variation to the contract.
Restricted variations will cover changes to pay, pension, hours of work, holiday entitlement, and anything else the Secretary of State sets out in subsequent Regulations.
There is separate proposed amendment which excludes any minor variations not relating to pay, working hours or location of work from the automatic unfair dismissal rules.
If an employer dismisses because an employee refuses to accept a non-restricted variation (i.e. one which is not included in the list above), it will not amount to an automatic unfair dismissal.
There will be no statutory checklist. Once an employer establishes that there is serious financial distress in play the employment tribunal will revert to the normal section 98(4) reasonableness test for unfair dismissal. Only if an employer cannot establish imminent business collapse will the dismissal be automatically unfair.
Another amendment which is proposed states that where a redundancy takes place due to outsourcing it will be automatically unfair unless the employer can establish serious financial distress.
Standard location redundancies will continue to be governed by the ordinary redundancy regime.
We will keep you posted on further updates as they come in.
This blog was written by Yavnik Ganguly, Senior Solicitor at didlaw.Â
