Session 2012 - 13
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Enterprise and Regulatory Reform Bill


Enterprise and Regulatory Reform Bill
Part 2 — Employment

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(b)   

the disclosure is made for the purpose of enabling or assisting

an officer of ACAS to carry out the functions of a conciliation

officer under any enactment,

(c)   

the disclosure is made for the purpose of enabling or assisting—

(i)   

a person appointed by ACAS under section 210(2), or

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(ii)   

an arbitrator or arbiter appointed by ACAS under any

enactment,

   

to carry out functions specified in the appointment,

(d)   

the disclosure is made for the purposes of a criminal

investigation or criminal proceedings (whether or not within

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the United Kingdom),

(e)   

the disclosure is made in order to comply with a court order,

(f)   

the disclosure is made in a manner that ensures that no relevant

person to whom the information relates can be identified, or

(g)   

the disclosure is made with the consent of each relevant person

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to whom the information relates.

(3)   

Subsection (2) does not authorise the making of a disclosure which

contravenes the Data Protection Act 1998.

(4)   

A person who discloses information in contravention of this section

commits an offence and is liable on summary conviction to a fine not

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exceeding level 5 on the standard scale.

(5)   

Proceedings in England and Wales for an offence under this section

may be instituted only with the consent of the Director of Public

Prosecutions.

(6)   

For the purposes of this section information held by—

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(a)   

a person appointed by ACAS under section 210(2) in connection

with functions specified in the appointment, or

(b)   

an arbitrator or arbiter appointed by ACAS under any

enactment in connection with functions specified in the

appointment,

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is information that is held by ACAS in connection with the provision of

a service by ACAS.”

Procedure for deciding tribunal cases

11      

Decisions by legal officers

(1)   

In section 4 of the Employment Tribunals Act 1996 (composition of a tribunal),

35

after subsection (6C) insert—

“(6D)   

A person appointed as a legal officer in accordance with regulations

under section 1(1) may determine proceedings in respect of which an

employment tribunal has jurisdiction, or make a decision falling to be

made in the course of such proceedings, if—

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(a)   

the proceedings are of a description specified in an order under

this subsection made by the Secretary of State and the Lord

Chancellor acting jointly, and

(b)   

all the parties to the proceedings consent in writing;

   

and any determination or decision made under this subsection shall be

45

treated as made by an employment tribunal.”

 
 

Enterprise and Regulatory Reform Bill
Part 2 — Employment

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(2)   

In section 41(2) of that Act (orders etc subject to affirmative resolution

procedure), after “section 4(4)” insert “or (6D)”.

12      

Composition of Employment Appeal Tribunal

(1)   

The Employment Tribunals Act 1996 is amended as set out in subsections (2)

to (4).

5

(2)   

In section 28 (composition of Appeal Tribunal), for subsections (2) to (4A)

substitute—

“(2)   

Proceedings before the Appeal Tribunal are to be heard by a judge

alone.

   

This is subject to subsections (3) to (6) and to any provision made by

10

   

virtue of section 30(2)(f) or (2A).

(3)   

A judge may direct that proceedings are to be heard by a judge and

either two or four appointed members.

(4)   

A judge may, with the consent of the parties, direct that proceedings are

to be heard by a judge and either one or three appointed members.

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(5)   

The Lord Chancellor may by order provide for proceedings of a

description specified in the order to be heard by a judge and either two

or four appointed members.

(6)   

In proceedings heard by a judge and two or four appointed members,

there shall be an equal number of—

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(a)   

employer-representative members, and

(b)   

worker-representative members.

(7)   

In this section—

“employer-representative members” means appointed members

whose knowledge or experience of industrial relations is as

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representatives of employers;

“worker-representative members” means appointed members

whose knowledge or experience of industrial relations is as

representatives of workers.”

(3)   

In section 30 (Appeal Tribunal procedure rules), in subsection (2)(f) (provision

30

for dealing with interlocutory matters), for the words from “otherwise” to the

end substitute “by an officer of the Appeal Tribunal”.

(4)   

In section 41(2) (orders etc subject to affirmative resolution procedure), before

“or 40” insert “, 28(5)”.

(5)   

In consequence of the amendment made by subsection (2), omit paragraph 46

35

of Schedule 8 to the Tribunals, Courts and Enforcement Act 2007.

Unfair dismissal

13      

Dismissal for political opinions: no qualifying period of employment

In section 108 of the Employment Rights Act 1996 (qualifying period of

 
 

Enterprise and Regulatory Reform Bill
Part 2 — Employment

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employment), after subsection (3) insert—

“(4)   

Subsection (1) does not apply if the reason (or, if more than one, the

principal reason) for the dismissal is, or relates to, the employee’s

political opinions or affiliation.”

14      

Confidentiality of negotiations before termination of employment

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After section 111 of the Employment Rights Act 1996 insert—

“111A   

Confidentiality of negotiations before termination of employment

(1)   

Evidence of pre-termination negotiations is inadmissible in any

proceedings on a complaint under section 111.

   

This is subject to subsections (3) to (5).

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(2)   

In subsection (1) “pre-termination negotiations” means any offer made

or discussions held, before the termination of the employment in

question, with a view to it being terminated on terms agreed between

the employer and the employee.

(3)   

Subsection (1) does not apply where, according to the complainant’s

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case, the circumstances are such that a provision (whenever made)

contained in, or made under, this or any other Act requires the

complainant to be regarded for the purposes of this Part as unfairly

dismissed.

(4)   

In relation to anything said or done which in the tribunal’s opinion was

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improper, or was connected with improper behaviour, subsection (1)

applies only to the extent that the tribunal considers just.

(5)   

Subsection (1) does not affect the admissibility, on any question as to

costs or expenses, of evidence relating to an offer made on the basis that

the right to refer to it on any such question is reserved.”

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15      

Power by order to increase or decrease limit of compensatory award

(1)   

The Secretary of State may by order made by statutory instrument amend

section 124 of the Employment Rights Act 1996 (limit of compensatory award

etc) so as to vary the limit imposed for the time being by subsection (1) of that

section.

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(2)   

The limit as so varied may be—

(a)   

a specified amount, or

(b)   

the lower of—

(i)   

a specified amount, and

(ii)   

a specified number multiplied by a week’s pay of the individual

35

concerned.

(3)   

Different amounts may be specified by virtue of subsection (2)(a) or (b)(i) in

relation to employers of different descriptions.

(4)   

An amount specified by virtue of subsection (2)(a) or (b)(i)—

(a)   

may not be less than median annual earnings;

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(b)   

may not be more than three times median annual earnings.

(5)   

A number specified by virtue of subsection (2)(b)(ii) may not be less than 52.

 
 

Enterprise and Regulatory Reform Bill
Part 2 — Employment

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(6)   

An order under this section may make consequential, supplemental,

transitional, transitory or saving provision.

(7)   

The consequential provision that may be made under subsection (6) includes

provision inserting a reference to section 124 of the Employment Rights Act

1996 in section 226(3) of that Act (week’s pay: calculation date in unfair

5

dismissal cases).

(8)   

A statutory instrument containing an order under this section is not to be made

unless a draft of the instrument has been laid before each House of Parliament

and approved by a resolution of each House.

(9)   

In this section “median annual earnings” means—

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(a)   

the latest figure for median gross annual earnings of full-time

employees in the United Kingdom published by the Statistics Board

(disregarding any provisional figures), or

(b)   

if that figure was published by the Statistics Board more than two years

before the laying of the draft of the statutory instrument in question, an

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estimate of the current amount of such earnings worked out in

whatever way the Secretary of State thinks fit.

(10)   

In section 34 of the Employment Relations Act 1999 (indexation of amounts

etc), after subsection (4) insert—

“(4A)   

A reference in this section to a sum specified in section 124(1) of the

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Employment Rights Act 1996 does not include anything specified by

virtue of section 15(2)(b)(ii) of the Enterprise and Regulatory Reform

Act 2013 (specified number multiplied by a week’s pay of the

individual concerned).

(4B)   

As regards a sum specified in section 124(1) of the Employment Rights

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Act 1996, the duty under subsection (2) to make an order with effect

from 6 April in a particular year does not arise where an order varying

such a sum with effect from a day within 12 months before that date has

been made under section 15(1) of the Enterprise and Regulatory

Reform Act 2013.”

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Financial penalties

16      

Power of employment tribunal to impose financial penalty on employers etc

(1)   

After section 12 of the Employment Tribunals Act 1996 insert—

“Financial penalties

12A     

Financial penalties

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(1)   

Where an employment tribunal determining a claim involving an

employer and a worker—

(a)   

concludes that the employer has breached any of the worker’s

rights to which the claim relates, and

(b)   

is of the opinion that the breach has one or more aggravating

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features,

   

the tribunal may order the employer to pay a penalty to the Secretary

of State (whether or not it also makes a financial award against the

employer on the claim).

 
 

Enterprise and Regulatory Reform Bill
Part 2 — Employment

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(2)   

The tribunal shall have regard to an employer’s ability to pay—

(a)   

in deciding whether to order the employer to pay a penalty

under this section;

(b)   

(subject to subsections (3) to (7)) in deciding the amount of a

penalty.

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(3)   

The amount of a penalty under this section shall be—

(a)   

at least £100;

(b)   

no more than £5,000.

   

This subsection does not apply where subsection (5) or (7) applies.

(4)   

Subsection (5) applies where an employment tribunal—

10

(a)   

makes a financial award against an employer on a claim, and

(b)   

also orders the employer to pay a penalty under this section in

respect of the claim.

(5)   

In such a case, the amount of the penalty under this section shall be 50%

of the amount of the award, except that—

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(a)   

if the amount of the financial award is less than £200, the

amount of the penalty shall be £100;

(b)   

if the amount of the financial award is more than £10,000, the

amount of the penalty shall be £5,000.

(6)   

Subsection (7) applies, instead of subsection (5), where an employment

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tribunal—

(a)   

considers together two or more claims involving different

workers but the same employer, and

(b)   

orders the employer to pay a penalty under this section in

respect of any of those claims.

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(7)   

In such a case—

(a)   

the amount of the penalties in total shall be at least £100;

(b)   

the amount of a penalty in respect of a particular claim shall

be—

(i)   

no more than £5,000, and

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(ii)   

where the tribunal makes a financial award against the

employer on the claim, no more than 50% of the amount

of the award.

   

But where the tribunal makes a financial award on any of the claims

and the amount awarded is less than £200 in total, the amount of the

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penalties in total shall be £100 (and paragraphs (a) and (b) shall not

apply).

(8)   

Two or more claims in respect of the same act and the same worker

shall be treated as a single claim for the purposes of this section.

(9)   

Subsection (5) or (7) does not require or permit an order under

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subsection (1) (or a failure to make such an order) to be reviewed where

the tribunal subsequently awards compensation under—

(a)   

section 140(3) of the Trade Union and Labour Relations

(Consolidation) Act 1992 (failure to comply with tribunal’s

recommendation),

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(b)   

section 117 of the Employment Rights Act 1996 (failure to

reinstate etc.),

 
 

Enterprise and Regulatory Reform Bill
Part 2 — Employment

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(c)   

section 124(7) of the Equality Act 2010 (failure to comply with

tribunal’s recommendation), or

(d)   

any other provision empowering the tribunal to award

compensation, or further compensation, for a failure to comply

(or to comply fully) with an order or recommendation of the

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tribunal.

(10)   

An employer’s liability to pay a penalty under this section is

discharged if 50% of the amount of the penalty is paid no later than 21

days after the day on which notice of the decision to impose the penalty

is sent to the employer.

10

(11)   

In this section—

“claim”—

(a)   

means anything that is referred to in the relevant

legislation as a claim, a complaint or a reference, other

than a reference made by virtue of section 122(2) or

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128(2) of the Equality Act 2010 (reference by court of

question about a non-discrimination or equality rule

etc), and

(b)   

also includes an application, under regulations made

under section 45 of the Employment Act 2002, for a

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declaration that a person is a permanent employee;

“employer” has the same meaning as in Part 4A of the

Employment Rights Act 1996, and also—

(a)   

in relation to an individual seeking to be employed by a

person as a worker, includes that person;

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(b)   

in relation to a right conferred by section 47A or 63A of

the Employment Rights Act 1996 (right to time off for

young person for study or training), includes the

principal within the meaning of section 63A(3) of that

Act;

30

(c)   

in relation to a right conferred by the Agency Workers

Regulations 2010 (S.I. 2010/93), includes the hirer

within the meaning of those Regulations and (where the

worker is not actually employed by the temporary

work agency) the temporary work agency within that

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meaning;

“financial award” means an award of a sum of money, but does

not including anything payable by virtue of section 13;

“worker” has the same meaning as in Part 4A of the Employment

Rights Act 1996, and also includes an individual seeking to be

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employed by a person as a worker.

(12)   

The Secretary of State may by order—

(a)   

amend subsection (3), (5) or (7) by substituting a different

amount;

(b)   

amend subsection (5), (7) or (10) by substituting a different

45

percentage;

(c)   

amend this section so as to alter the meaning of “claim”.

(13)   

The Secretary of State shall pay sums received under this section into

the Consolidated Fund.”

 
 

Enterprise and Regulatory Reform Bill
Part 2 — Employment

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(2)   

Schedule 3 (financial penalties: minor and consequential amendments) has

effect.

Protected disclosures

17      

Disclosures not protected unless believed to be made in the public interest

In section 43B of the Employment Rights Act 1996 (disclosures qualifying for

5

protection), in subsection (1), after “in the reasonable belief of the worker

making the disclosure,” insert “is made in the public interest and”.

18      

Power to reduce compensation where disclosure not made in good faith

(1)   

Omit the words “in good faith” in the following provisions of Part 4A of the

Employment Rights Act 1996 (protected disclosures)—

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(a)   

subsection (1) of section 43C (disclosure to employer or other

responsible person);

(b)   

paragraph (b) of section 43E (disclosure to Minister of the Crown);

(c)   

subsection (1)(a) of section 43F (disclosure to prescribed person).

(2)   

In section 43G of that Act (disclosure in other cases), in subsection (1)—

15

(a)   

omit paragraph (a);

(b)   

in paragraph (b), for “he” substitute “the worker”.

(3)   

In section 43H of that Act (disclosure of exceptionally serious failure), in

subsection (1)—

(a)   

omit paragraph (a);

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(b)   

in paragraph (b), for “he” substitute “the worker”.

(4)   

In section 49 of that Act (remedies for detriment suffered in employment), after

subsection (6) insert—

“(6A)   

Where—

(a)   

the complaint is made under section 48(1A), and

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(b)   

it appears to the tribunal that the protected disclosure was not

made in good faith,

   

the tribunal may, if it considers it just and equitable in all the

circumstances to do so, reduce any award it makes to the worker by no

more than 25%.”

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(5)   

In section 123 of that Act (compensatory award for unfair dismissal), after

subsection (6) insert—

“(6A)   

Where—

(a)   

the reason (or principal reason) for the dismissal is that the

complainant made a protected disclosure, and

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(b)   

it appears to the tribunal that the disclosure was not made in

good faith,

   

the tribunal may, if it considers it just and equitable in all the

circumstances to do so, reduce any award it makes to the complainant

by no more than 25%.”

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Revised 19 March 2013