News


Two months to get ready for new consultation law

New laws coming into force in April will mean employers have to inform and consult staff on business issues if asked by as few as 15 employees. Failure to do so could land an employer with a fine of up to £75,000. 

Up to now firms with less than 100 employees have been exempt.  From April any employer with more than 50 staff will have to comply.

Commenting on the new rules, Philip Sack, Director of Policy at ESG, the leading experts on the new laws, said:

"Many companies are unaware of these laws about to hit them, or the potential £75,000 fine if they get it wrong. Our advice to them is first of all find out what they have to do, and then take a look at their internal communications policy in light of the new obligations. The sooner they do this, the better.

"There are big incentives in this legislation to take the initiative, and not wait to be forced into something you may not want to do by a small group of employees. A lot of companies have found, by being pro-active, they can keep control of their employee communications in a way that suits their business, and stay within the law at the same time.

"You don't have to set up a staff forum or consultation, if you don't won't to. Direct forms of information and consultation are allowed, and this is probably better for smaller companies. But you need to understand how to make use of the flexibility in the law. Many businesses have even found it has helped them engage with their staff much better."

To help employers understand the new law for themselves, and make sure they are compliant, ESG has set up a website that gives access to specialist advice and a legally-compliant document tailored to their individual circumstances, at a fraction of the cost of using a lawyer.

February 2008

 

Another employer falls foul of law

In the latest ruling from the CAC another employer has fallen foul of the Information and Consultation Regulations.

Newsquest, a regional newspaper publisher, thought it was safe when a group of employees organised a request for a new, statutory consultation body.  The company already had voluntary consultation arrangements in place, but failed to tell the workforce it was going to run a ballot to see if they supported the request for something new.

Trade union, Unite (formerly Amicus), took them to the Central Arbitration Committee and won.

Newsquest now have to abandon their volunatry arrangements and set up a permanent, statutory consultation body.

This latest case follows on from three previous ones, all of which have gone against the employer.  In each case, the employer thought they had adequate voluntary arrangements.  The CAC decided they hadn't.

 

August 2007

MacMillan hit with £55,000 fine

Publishing House MacMillan has received a £55,000 fine from the Employment Appeals Tribunal for failing to set up an Employee Consultation Forum.

 

This is the first fine handed down by the EAT under the Information and Consultation of Employee Regulations.

 

MacMillan received a request organised by trade union Amicus in 2006 to set up an Employee Forum, but failed to respond to it as required by the law.  Amicus took MacMillan to the Central Arbitration Committee who upheld its complaint in February this year.  The CAC strongly criticised MacMillan for the way it responded to the request for an employee forum.

 

Amicus has now applied to the EAT for a penalty against MacMillan. The maximum fine EAT could have imposed was £75,000.

 

Commenting on the fine, Philip Sack, Director of Policy at European Study Group said:

 

“This is a pretty hefty fine and shows the importance of responding properly to employee requests under the ICE Regulations.

 

Since April this year the law has applied to companies with 100 or more employees, this means just 15 employees is all it takes to trigger a request under the Regulations.  From April 2008, it will apply to firms with 50 or more employees.

 

Employers need to be aware of the law and how they should respond to it.  The best strategy is to put a voluntary agreement in place before you get a formal request.”

 

July 2007

 

Notes for editors

1. The Information and Consultation Regulations, also known as the ICE Regulations, came into force in April 2005. The ICE Regulations require employers to set up permanent information and consultation arrangements when requested by 10% of employees (subject to a minimum of 15 employees). Where an employee request is made, there is a 6-month period to negotiate an agreement on the arrangements to be put in place. Failure to respond to a request, or failure to reach agreement, triggers "fallback" rules that require the employer to set up a works council or employee committee of up to 25 employee representatives.

2. Initially the ICE Regulations only applied to firms with 150 or more UK employees. From April 2007 they will apply to firms with 100 or more employees, and a year later, in April 2008 they will apply to firms with 50 or more employees.

3. European Study Group was established in 1990 to advise employers on how to comply with EU-inspired legislation on employee information and consultation. Since then it has helped numerous companies with the legal and practical issues around employee information and consultation.

4. European Study Group has launched a website - Just15.co.uk - aimed at companies in the 50 to 500 employee range to help them get to grips with the Information and Consultation Regulations.