Changes to the employment law regulations

The amendments to the Enterprise and Regulatory Reform Bill announced by the Government will:-

1.   Enable a Government minister to make regulations which require Employment Tribunals to order employers who have lost equal pay claims or who have been found to have discriminated because of sex in non-contractual pay (such as a discretionary bonus) to carry out an equal pay audit.

An audit is described as being "designed to identify action to be taken to avoid equal pay breaches occurring or continuing".  Regulations will spell out such details as the content of equal pay audits, any sanctions to be applied for failure to comply with an order and publication requirements.

However an equal pay audit cannot be ordered in all circumstances and there will be exceptions for:-

• Where an audit has already been completed by the employer in the previous 3 years and meets prescribed requirements.
• Where the breach of equal pay law gives the Tribunal no reason to think that there may be other breaches by the employer.
• Where the disadvantage of an equal pay audit would outweigh its benefits; and
• Where it is clear what, if any, action is required to avoid equal pay breaches occurring or continuing without an audit.

2.   Remove the provision in the Equality Act 2010 which makes the employer liable for harassment of its employees by third parties (such as customers or clients) over whom the employer does not have direct control.

In the Government's view this provision "imposed an unnecessary burden on business".

3.   Abolish the statutory questionnaire procedure in discrimination claims.  This procedure is used by an individual who thinks they may have been unlawfully discriminated against, harassed or victimised to obtain information from their employer or former employer.

The answers provided by the employer in response are admissible as evidence in a discrimination case brought against by them by the individual.  Tribunals can also draw inferences from an employer's failure to respond within 8 weeks or from evasive or equivocal answers. 

However employers should be aware that, as the Government acknowledges, an individual can still ask an employer questions and a Tribunal could still conclude adverse inferences from an employer's refusal to respond or from their evasive answers.

This means that in practice although employees will no longer be able to send a formal statutory questionnaire to an employer, they or their representative will instead be able to write to them asking the same sorts of questions.  The only difference is that those questions will be in another format (e.g. a letter) rather than in a formal questionnaire.