Firms ‘race to fire employees’ before tough new workers’ rights laws in January

Detailed summary

New figures reveal the number of jobs employers are proposing to cut through redundancies has risen by almost 10 per cent in a year ...

Some British firms are rushing to fire employees before tougher new dismissal rules come into force at the start of next year, lawyers say.

Employment lawyers told The i Paper that some firms are racing to cut jobs before new workers’ rights legislation on unfair dismissal claims and compensation takes effect from 1 January.

But they said this was not the only reason for redundancies, citing higher employment costs for businesses and rising inflation. Figures reveal the number of jobs employers are proposing to cut through redundancies has risen by almost 10 per cent in a year.

Under the Employment Rights Act, which is being introduced in stages, employees will be able to bring a claim for unfair dismissal after six months in a job instead of two years.

The cap on compensation that employment tribunals can award in unfair dismissal cases will also be removed, potentially exposing employers to much larger payouts.

Employment lawyers said the new laws were making employers more cautious about hiring and retaining staff.

Adrian Hoggarth, head of employment at Jurit LLP, told The i Paper: “Employers are looking at their contracts and probationary policies and are making decisions on who to let go before the unfair dismissal qualifying period reduces to six months. It is affecting senior level employees because the cap on unfair dismissal claims is being abolished.

“We have also seen a large increase in numbers of employees being let go before they accrue unfair dismissal rights.”

Under UK employment law, an employer must notify the Insolvency Service government body, when it proposes to make 20 or more employees redundant.

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