Key employment law updates | December 2024

Welcome to our monthly update, where we share upcoming changes to employment law.

Length of time to bring an employment tribunal claim could be extended to six months

The government has proposed an amendment to its Employment Rights Bill, which would see the length of time workers have to bring tribunal claims extended. Currently, for most claims, a claimant has three months minus one day from the alleged mistreatment taking place to bring an employment tribunal claim. This proposed amendment however would extend this time limit to six months. 

Whilst this will provide parties with more time to attempt to reach a settlement and resolve disputes before a claim reaches a tribunal, this proposed change will also likely have the unintended consequences of increasing the number of claims tribunals must deal with, extending the period of uncertainty for employers, and ultimately lead to potentially higher legal costs.

To prepare for this proposed change, businesses should review their data retention policies and place a greater emphasis on documentation and record-keeping, as well as providing additional training and support for managers in dealing with grievances. 

Dismissal and re-engagement

From 20 January 2025, employers who do not comply with the dismissal and re-engagement code of practice, otherwise known as "fire and rehire", could be ordered to pay increased protective awards of up to 25%.

A protective award is a compensatory penalty awarded by an employment tribunal against an employer who has not complied with their collective redundancy consultation obligations. This can be awarded where a redundancy situation involves 20 or more employees at any establishment and can be up to 90 days' actual gross pay per affected employee. From next year, this penalty can therefore be increased by 25%.

This change, together with the proposed Employment Rights Bill which makes it nearly impossible to force through contract changes that employees will not agree, signals the government's intention to remove fire and rehire practices altogether.

Employers considering pursuing these strategies will need to consider the increased possibility of facing claims for unfair dismissal, as well as the risk of having to pay an increase in compensation to each employee impacted. 

Neonatal care leave and pay due to come into force 

The Neonatal Care (Leave and Pay) Act 2023 received Royal Assent on 24 May 2023. It is expected that new rules on neonatal care leave and pay will come into force in April 2025.

The Act introduces provisions to enable parents whose babies require specialist care after birth to take additional paid time off work up to 12 weeks, on top of other leave entitlements like maternity and paternity leave.

Neonatal care leave will be available from day-one of employment and apply to parents of babies admitted to hospital up to the age of 28 days and stay in hospital for seven full days continuously or more.

The new changes will be welcomed by employees and parents who have called for greater support during an incredibly difficult time. Many employers will also be pleased to offer better support for staff. For employers, the payments will be made by them and claimed back through payroll processes similar to other statutory payments such as Statutory Parental Bereavement Pay.