The Government yesterday published two new consultations on proposed reforms to employment law.

The first includes very significant proposed changes to TUPE in response to the 'call for evidence' last year: 

  • the Government proposes stripping out the "service provision change" clauses added to TUPE in 2006, and reverting to the single "business transfer" test.  Although this removal of "gold-plating" may be popular with business, the consequent return to the complicated pre-2006 caselaw on when a change of contractor is a business transfer will be less welcome.  The Government has asked for views on whether domestic caselaw on business transfers needs adjusting to ensure it goes no further than required by EU law.  There will be a lead-in period before this change comes into effect;
  • the requirement on a transferor to provide employee liability information 14 days prior to the transfer may be repealed.  This issue is often dealt with by contractual agreement on business transfers and first generation outsourcing, though not commonly in second generation outsourcing.  The Government seems to be suggesting a new obligation on the transferor to provide information necessary for the transferee to confirm what measures it proposes taking post-transfer, to enable it to comply with its information and consultation duty, with a failure to co-operate affecting the apportionment of liability for failure to inform and consult;
  • the restrictions on changing terms and conditions and dismissals are to be narrowed to mirror EU law.  The Government is suggesting that only changes by reason of the transfer (and not "transfer-connected changes") would be prohibited and that the parties would be able to agree any change that they could have agreed had there not been a transfer, or where there is an "ETO reason".  Likewise, dismissals which are only "transfer-connected" rather than by reason of the transfer itself may not be automatically unfair;
  • change of location redundancies are to qualify as "ETO" dismissals and therefore not automatically unfair (the current caselaw test requires a change in the numbers or functions of the workforce, which exclude such redundancies);
  • the Government is considering reversing caselaw and providing that a transferor can rely on a transferee's ETO reason; 
  • collective redundancy consultation by a transferee with the representatives of the transferring employees started prior to the transfer will count for the purposes of the transferee's collective redundancy consultation duties;
  • currently the 'quasi-constructive dismissal' provisions enable an employee to claim unfair dismissal on the ground of a substantial change in working conditions to their material detriment, even where this would not normally amount to a repudiatory breach;  the Government proposes changing this so that the employee can still resign on these grounds but will only be entitled to notice monies and could not claim unfair dismissal (unless there is a true constructive dismissal situation);
  • depending on the outcome of the Parkwood v Alemo-Herron case concerning terms deriving from collective agreements, the Government may decide to allow such terms to be varied one year after the transfer, provided the change is no less favourable to the employee;
  • micro-businesses (with 10 or fewer employees) will not have to elect employee representatives and, if there are none already in place, can instead inform and consult with the individual affected employees.

Views are sought by 11 April 2013 and the Government hopes to bring changes into effect in October 2013.

The second consultation seeks views by 15 February 2013 on the Government's plans for implementing the pre-claim conciliation proposals included in the Enterprise and Regulatory Reform Bill.  Pursuant to the Bill, claimants are to be required to submit a form to Acas and will then be offered pre-claim conciliation for a period to be prescribed by regulation. Time limits for submitting the ET1 will be adjusted accordingly. Acas will have a duty to conciliate if requested by the parties both before and post claim.

The consultation paper proposes that the form to be submitted to Acas include contact details and a statement that the claimant is considering bringing a tribunal claim, but will not require any detail about the nature of the dispute.  This neatly avoids issues with a claimant failing to specify a type of claim which they later wish to bring, but it could make the conciliation less structured and potentially less effective.  Pre-claim conciliation is to be available for one month, with a potential for a two week extension.

The DWP has also published its response to the independent review of the sickness absence system by Dame Carol Black and David Frost.  A new health and work advisory and assessment service is to be established in 2014.  This will make occupational health advice more readily available, for example, there will be a State-funded assessment by occupational health professionals for employees who are off sick for four weeks or more.