This article was last updated on April 16, 2022
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Vince Cable is going to reject proposals backed by Downing Street that permit companies to “fire at will” under-performing workers without them being able to claim unfair dismissal.
Mr. Cable has said: “Our starting point is that Britain already has very flexible labour markets. But we acknowledge that more can be done to help small companies by reducing the burden of employment tribunals, which we are reforming, and moving to less confrontational dispute resolutions through settlement agreements.”
Mr. Cable will announce substitute measures to help companies in confident recruiting system. He will propose such “settlement agreements” under which enable employers to make a compensation offer to an under-performing worker. If the employee accepts the deal, they cannot then claim unfair dismissal. But the pay-off cannot be imposed on them, as under “fire at will”.
He will answer Tory claims that he is a “roadblock to growth” by unveiling other plans to give business more confidence. The £72,300 cap on unfair dismissal payouts will be reduced, possibly to one year’s salary, because the median compensation is only within the range of £5,000 to £6,000. Employment tribunals will be speeded up and streamlined for efficient cost budgeting and to quickly throw out the weak cases.
TUC’s Sarah Veale is of the opinion that proposals were still wrong due to the term ‘unfair dismissal’ as it refers to the wrong dismissal of the worker by the employer.
While Federation of Small Businesses’ John Walker has welcomed the altered proposals and said: “Too many small firms don’t take on staff because they fear being taken to an employment tribunal. Other firms fear facing an expensive and lengthy dismissal process.”
Government sources are denying the presence of a row between the two Coalition parties over the package. Cable allies insist about 80 percent of Mr. Beecroft’s proposals are being implemented.
And in a sign that the Business Secretary has answered his critics, his blueprint won the backing of the Institute of Directors last night.
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