Government to Drop “Fire at Will” Plans

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Business Secretary Vince Cable will today announce proposed changes to employment law, following recommendations made in a Government-commissioned report by venture capitalist Adrian Beecroft. In an attempt to give businesses more confidence to recruit staff, Mr Cable will announce that payouts for unfair dismissal at employment tribunal are to be reduced. He wants to reduce the current cap of £72,300 to one year’s salary or an even lower figure to encourage small businesses to start recruiting more staff, believing that the current cap deters small companies from taking on staff for fear they could end up with a big bill. Other proposals to be confirmed include giving tribunal judges authority to review tribunal cases before reaching court to allow them the ability to dismiss weak cases without a hearing and give stronger legal protection to Companies wanting to remove under-performing staff. Mr Cable wants to bolster settlement agreements allowing employers the opportunity to offer a pay-off to resolve disputes. If the worker accepts an offer, it would become legally protected and prevent a subsequent tribunal claim. Previous controversial proposals for “no-fault dismissals” will not be implemented even though they had the backing of the British Chambers of Commerce and several Conservative MPs. Mr Cable said “People would feel intimidated if they knew that they could be fired on the spot without good reason and that is why we have said not to those proposals”. He said he was “trying to strike a balance” between helping employers whilst protecting employees. “We don’t want people to feel insecure, but at the same time small companies have got to feel confident that if they take somebody on they’re not going to get caught up in a very elaborate, legalistic, time-consuming tribunal system.”

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