Appearing on the BBC Breakfast Programme Robin Chater, secretary general of the FedEE said he was in support of the extension from one to two years of the service period required in the UK before employees may claim unfair dismissal. The change that came into force on Friday will mean that employers will have far longer to assess whether a new employee is suitable for their job.
Drawing from recent experience in the Spanish economy, Chater pointed out that offering too high a level of employment protection only dissuades employers from creating permanent jobs.
He said 80% of jobs generated in the last five years in Spain have been temporary and the growing crisis in Spain has meant that a high proportion of temporary contracts are not being renewed. This has particularly hit young workers - resulting in half of them now being unemployed.
In Chater's view the unwelcome consequence of extending the service period to two years will be to encourage employees who have been sacked to make spurious discrimination or harassment claims against their former employers. Such claims may be made from day one of an employment contract and because of reversed burden of proof rules it is down to employers accused of discrimination or harassment to prove that the claim is unfounded. Compensation in such cases is also open ended and successful claims can result in substantial awards. Legal costs can also mount up quickly to over 30,000 in cases that reach the tribunal stage. For this reason most discrimination and harassment claims are settled out of court.
Chater also suggested that the best protection against unfair dismissal was to have a sound disciplinary policy in place. He went on to accuse the union movement of not speaking out strongly enough against the repeal of statutory dispute resolution procedures in April 2009. This, he said, was because of the high demands on trade unions to supply representatives at disciplinary hearings. Chater went on to point out that UK tribunal statistics indicated that each year a declining number of tribunal cases involved representation by trade unions.
The GMB responded that the declining level of tribunal representation was because hearings were the increasingly the domain of legal professionals because of the use by employers of strong legal defence teams. On the contrary, claimed Chater, the real reason why lawyers were increasingly involved in tribunal hearings was because the field was being swamped by "no win, no fee" solicitors hired by employees and trade unions were simply giving way.
Speaking after the interview Chater expressed his concern that out of court settlements for discrimination and harassment claims could rise sharply in the next ten - fifteen years even without the extension of the unfair dismissal service period.
He said: "This would be especially the case with racial discrimination claims as ethnic minority groups will be increasing their representation in the UK population by 50% by 2025, whilst also changing residency patterns. As minority groups move away from Greater London and the M1/M6 corridor into areas with stronger traditional prejudicial attitudes the potential for workplace discrimination will grow. That is why we have been working with ACAS and the TUC to improve workplace training and we have jointly produced a 25-minute training video called Without Prejudice."