Plans for greater business flexibility and quicker resolution for workplace disputes were announced this week by the Business Secretary, Vince Cable.
The Government plans to introduce measures with the aim of boosting business confidence and easing the handling of workplace disputes through facilitating the use of settlement agreements between employers and employees.
Under these measures, employers will be able to offer settlement agreements before a formal dispute arises and will be legally protected from this offer being used as evidence in an unfair dismissal tribunal case. Employees should also continue to enjoy full protection of their employment rights, as they can choose to reject the offer of a settlement agreement and proceed to a tribunal
“Settlement agreements are smart, fair and pro-business reforms which deliver results for employees and employers,” said Business Secretary, Vince Cable. “It empowers employers by enabling them to keep their workforce flexible and encouraging alternative ways of solving workplace problems rather than resorting to a tribunal. But crucially it does so in a way that keeps the necessary protections for employees in place.”
The Government wants to encourage greater use of settlement agreements and make it easier and quicker for employers - including SMEs - and employees to end the employment relationship by mutual agreement in a way that protects workers rights but helps businesses remain flexible.
The new clauses will be tabled in the forthcoming Committee stage of The Enterprise and Regulatory Reform Bill. A consultation will be published in the summer on the principles of guidance for using settlement agreements, including draft letters and model templates for employers and employees to use.