The Controversial Beecroft Report: Employment Law Reforms

Mark Higgins, Employment Partner

There is little doubt that the proposal to allow “no-fault” dismissals contained in the Beecroft report (published yesterday, following a leak to the Daily Telegraph) should be consigned to the bin.

The rationale behind the proposal was that businesses employing fewer than 10 employees would have a fail-safe way of removing ‘unproductive’ staff, thereby encouraging them to have the confidence to take on more staff in the first place. What utter nonsense!

The reality is that employers already have a significant period of grace from first taking on an employee before the latter gains the right not to be unfairly dismissed. For the last decade, this period has been 12 months and has recently been extended to two years. Even then, the right is not to be unfairly dismissed – not not to be dismissed at all. It is still perfectly possible to dismiss fairly in circumstances of poor performance. What greater reassurance does Beecroft think employers need?

In any event, if Beecroft thinks that the blunt instrument he proposes will mean employers can dismiss with impunity, he should think again. If implemented, the provisions would be open to all manner of challenges, not least because they flout the laws of natural justice.

Who decides when an employee has underperformed and by what criteria?

There is no doubt that employees who were to fall victim to the provisions would seek ways to circumvent them through alternative domestic legislation including the Equality Act 2010. And it would only be a matter of time before someone produces statistics to show that the provisions disparately impact upon a group sharing one of the protected characteristics (e.g. sex, race, disability etc).

There are many factors which lead to an employer’s reluctance to recruit – lack of suitable finance, uncertain and changing markets, nervousness as to the fate of the Eurozone and its ripple effect. Re-kindling Victorian attitudes to the hiring of labour will not rebuild the lost Empire.