Legal advice: Changes to employment law

Keep abreast of the forthcoming changes in law.

By Rebecca Caws of thePublican.com's team of legal experts from London solicitors Joelson Wilson.​

The past few years have seen a lot of changes in the employment law field. If you are hoping that 2006 will be a little quieter, you're in luck. There are, however, a few changes set to take place, the most important of which are summarised below.

Compensation rates​

February will see the first of this year's changes, with the following increases to the maximum amounts of compensation payable to a successful applicant in most unfair dismissal cases:

• £290 (from £280). Maximum for a week's pay to calculate the basic award of compensation for unfair dismissal or a redundancy payment
• £58,400 (from £56,800). Maximum for the additional compensatory award where the upper limit applies.

The increase only applies to claims based on an event occurring on or after February 1, 2006. Awards for any existing claim will be calculated on the 2005 figures (shown in brackets).

Statutory maternity, paternity and adoption payApril will see the next change, with the rates for statutory maternity, paternity and adoption pay set to rise from £106 to £108.85 per week.

National Minimum Wage​

Finally, October will see changes in the National Minimum Wage. The rate for workers aged 22 or over is set to increase from £5.05 an hour to £5.35 an hour and the rate for workers aged 18 to 21 from £4.25 an hour to £4.45 an hour.

It is not yet decided whether the rate for 16 to 17-year-olds will be increased. Another consideration will be whether to reduce the age to qualify for the adult rate to 21. The introduction of financial penalties and imposition of interest for businesses that fail to pay the minimum rate are also under consideration.

Age discrimination​

If all goes according to plan, and no changes are made to the existing regulations, the new law on age discrimination will be with us for October. This will mean:

• Age discrimination in recruitment, promotion and training will be banned
• All retirement ages under 65 will be banned, unless they can be objectively justified
• The current upper age limit for claiming unfair dismissal and redundancy rights will be removed
• Employers will be required to consider a request by an employee to work beyond the date on which they were due to retire
• Employers will be required to give at least six months written notice to employees before the intended retirement date so that people can plan in advance for their retirement.

Now is a good time to prepare for the forthcoming legislation. Employers should check existing procedures (e.g. recruitment and promotion) for potential age discrimination issues. For example, they should see whether the entitlement to any employment benefits is based on seniority, experience or length of service, as this could give rise to age discrimination issues, and to consider setting up a planned retirement scheme.

Employees can look forward to gaining new rights and protection and start planning their retirement in advance.