The government has recently published the second version of the Employment Rights Bill (Bill) following a series of amendments and initial read throughs in parliament. Interestingly, so far, there appears to have been little opposition to the Bill which still looks to be the most important piece of employment legislation in the UK in more than a decade – perhaps a sign of the times given there are (clearly!) far more pressing concerns regarding the general world order…

Several aspects of the new Bill are already subject to discussion, with a number of consultations kicking off before the Christmas holidays. You can find our summary of these and other aspects of the Bill here, here, here and mainly, here. There’s been no formal response to these consultations yet, but we’ll be keeping our eyes peeled and update you as soon as we hear more.

Circling back to the latest amendments, most of these are of the Claudio Ranieri mould – i.e. tinkering around the edges. However, there’s an extremely significant update hidden amongst the weeds. The Bill is now set to extend the time limit for bringing all types of employment tribunal claims from three to six months. This wasn’t previously in the initial draft of the Bill, nor prefaced in the Kings Speech. This couldn’t be anything other than pretty material news!

What does this mean for businesses? Let’s take a look.

Current position

Under the current rules, employees have a relatively short period of three months to bring an employment claim (although there is scope to extend this in certain circumstances, including stopping the limitation clock during a short period of ACAS conciliation). However, if employees have twice the amount of time to bring claims, they will naturally have more time to reflect, gather evidence and present a more compelling case to their former employers. It seems inevitable that this will increase the number of tribunal cases businesses face, particularly when combined with the proposed changes to unfair dismissal protection.

The government argues that extending the timeframe will present opportunities for everyone, including: (i) improving access to justice, in that employees will have more time to assess their claims and seek advice; (ii) encouraging resolutions between parties, as a longer window for negotiations will hopefully lead to more pre-tribunal settlements; and (iii) exchanging rushed claims for better-prepared cases will hopefully mean fewer procedural delays and tribunal inefficiencies. These are, on the face of it, sensible aims, but it is debatable whether extending the time limits in this way will actually achieve the aims in points (ii) and (iii). On the flipside, there is the possibility that longer limitation periods could increase uncertainty for businesses and impact the fairness of some tribunal hearings (as claims being heard later may, for example, mean evidence is harder to recall for witnesses).

We’ll see how this plays out in due course, but some of the key takeaways for employers are likely to be as follows:

• Increased exposure – a six-month claim window means more time for disputes to arise, even in circumstances where cases might have seemingly been resolved;
• Longer record-keeping – potential disclosure materials (such as documentation related to dismissals, grievance, and disciplinaries, etc.) will need to be retained for extended periods of time given claims may be received months later than currently expected;
• Increased likelihood of pre-claim negotiations – the ACAS early conciliation process could take more prevalence if there’s a little more time to breathe before a claim deadline.

What happens next?

The amended Bill is still working its way through parliament and there are likely to be more twists and turns before any of the proposals become law. We’ll be reporting on any further interesting insights as they develop.