What are the proposed changes around redundancy?
The Employment Rights Bill (the Bill) proposes to extend existing protection against redundancy to cover any type of dismissal for expectant and new parents. Laura Roberts considers the changes and what further details are still awaited.
The current law and previous changes – redundancy protection
Currently in a redundancy situation, pregnant employees and those taking maternity leave, adoption leave or shared parental leave are afforded special protection for the duration of the ‘redundancy protected period’.
[Note: This protection had already been extended relatively recently (from 6 April 2024) to include cover for (1) pregnant employees and (2) those returning from adoption leave, or shared parental leave, (3) for a period of up to 18 months from the birth or adoption placement. Prior to that, only those on maternity leave were protected whilst they were actually taking the leave.]
What is the redundancy protected period?
For pregnant employees, the current redundancy protected period starts when they notify their employer that they are pregnant and ends 18 months after the birth of their child (or, if the employer is not notified of the date of birth, the expected week of childbirth).
In adoption cases, the protected period begins on the date the adoption placement starts or the date the child enters England, Scotland or Wales (if it’s an overseas adoption).
In shared parental leave cases, the protected period starts on the day a period of shared parental leave begins and ends on the last day of a block of leave if less than 6 weeks is taken or 18 months from the date of the child’s birth if 6 weeks’ or more continuous leave is taken. If an employee takes discontinuous leave, the protected period concludes at the end of each period of leave.
What current protection is offered?
The current law does not go so far as barring the dismissal of protected employees for redundancy; however, it gives them the right to be offered suitable alternative vacancies in a redundancy situation. This means that these employees have priority over other potentially redundant employees, even if they are also suitable, or even more suitable, for the alternative vacancies.
Failure to prioritise employees in this situation could result in their redundancy dismissal being automatically unfair and also, potentially, claims for pregnancy or maternity discrimination.
Proposed Further Changes under the Employment Rights Bill
In the Next Steps to Make Work Pay policy document (Next Steps) published alongside the Bill, there are numerous references to ‘strengthening the protections for pregnant workers’ and new parents returning to work.
The Bill paves the way for the government to introduce regulations to expand further the existing protections mentioned above.
Specifically, it is stated that it will be ‘unlawful to dismiss [pregnant workers]within 6 months of their return to work except for in specific circumstances’.
As with several other areas of reform within the Bill, there is much, including details of what those specific excepted circumstances are, that will be specified in subsequent regulations.
It is understood that the primary intention is that protection against dismissal will relate, not solely to redundancy, but to any dismissal during the protected period of 6 months following their return to work. Further and importantly, similar provisions are expected to also apply to those returning from adoption or shared parental leave.
When will these changes happen?
The indication from the government is that most reforms will not take effect before 2026. Consultation will also be required in respect of secondary legislation to implement the government’s plans in relation to dismissal protection.
What will this mean for employers?
Unfortunately, we will not know what ‘specific circumstances’ will permit an employer to dismiss a protected employee within 6 months of their return to work, or the extent of any other ‘strengthened protections for pregnant workers’, until secondary legislation has been published.
However, most employers are likely already aware that caution should be exercised in respect of pregnant employees, those taking adoption or shared parental leave during a redundancy situation, or where they are looking to dismiss an employee who is pregnant or taking adoption or shared parental leave.
Once the changes are implemented, employees will need to be aware of what the ‘specific circumstances’ are before dismissing pregnant employees or those who have recently returned to work and ensure that any dismissals during the protected period are permitted in order to avoid any claims for automatic unfair dismissal or potentially pregnancy/maternity discrimination.
In redundancy situations, it is essential that employers have a clear understanding of those potentially affected and what protection is afforded to them and to take advice at an early stage.
See our previous ERB Insights in this series
- Overview: ERB What’s In, What’s Out, What’s Next? (11 October 2024)
- ERB: Flexible Working: Further Flexion (21 October 2024)
- ERB: Day 1 right to claim unfair dismissal (25 October 2024)
- ERB: The Pendulum Swings on Industrial Relations (8 November 2024)
- ERB: The Fair Work Agency (15 November 2024)
- ERB: Dismissal and re-engagement - tying the hands of employers? (22 November 2024)
- ERB: Further rules on fair tipping (3 December 2024)
- ERB: First set of proposed amendments: what it means and what to expect (6 December 2024)
- ERB: Small but significant changes to the statutory sick pay system (13 December 2024)
If you'd like further guidance on the outlined changes to redundancy, please contact our employment law solicitors.
