Government’s Aim to Free Businesses from Red Tape Set to Impact on Employment Law

We assess what the reforms are likely to mean for employment law and Settlement Agreements

The Business Secretary, has announced a range of measures to reduce the amount of red tape faced by business. One side effect of this is the significant impact it’s likely to have on employment decisions.

The reforms include repealing the Regulations extending the right to request flexible working to the parents of 17 year olds, and introducing a moratorium on new regulation for small businesses. The Government believes that the reforms will remove barriers to growth but employment lawyers worry that it could also lead to greater insecurity in the workplace.

In September 2010, the Government announced that the right to request flexible working would be extended to parents of children under 18 years old The change was due to be implemented in April 2011. At the time the Government believed that the extension would benefit 288,000 employees and make it simpler for employers to identify whether an employee was eligible to make a request However, the Government’s recent announcement means that the Flexible Working Regulations 2010 will be now repealed and the right to request flexible working will only be available to parents of children aged under 17, disabled children under 18 and carers of certain adults.

The Government will also introduce a moratorium exempting businesses with fewer than ten employees, and genuine start-ups, from new domestic regulation for three years. As a result, these businesses will be exempt if the Government does create a new flexible system of shared parental leave, or extends the right to request flexible working for all employees – measures it will consult on later this year. The Government has also confirmed that the right to request time off to train will not now be extended to businesses employing fewer than 250 people.

The changes will be accompanied by a public audit of almost 22,000 existing statutory instruments. The legislation will be grouped into themes on a dedicated website and businesses will be asked to tell the Government what they think of those regulations and how the system could be improved. Any overly burdensome or unnecessary regulations will be removed unless Government departments can prove there is a good reason for them.

These measures are not likely to directly affect the rules governing Settlement Agreements, but with everything up for debate there could yet be implications for Settlement Agreements. We will be monitoring developments closely and reporting back, especially if the reforms change the way in which Settlement Agreements operate in the UK.

If you would like specialist advice on a Settlement Agreement then call us on 0808 155 6389 or email us at [email protected]