How-to guide: Overview of employment law (UK)

Introduction

This guide provides in-house counsel, private practice lawyers and human resources professionals with an overview of the key laws and principles of employment law in England, Wales and Scotland (GB). This guide does not cover employment law in Northern Ireland.

This guide covers:

Key employment legislation overview
General principles of GB employment law
Rights on termination of employment
Discrimination and harassment
Employee and worker rights during employment
Worker representation
Employee rights on the transfer of a business
Employment disputes

This guide can be read in conjunction with How-to guide: Overview of workplace discrimination and harassment law and Checklist: Determining the difference between an employee, a worker and an independent contractor.

Employers should be aware that the Employment Rights Bill 2024, introduced on 10 October 2024, aims to significantly enhance worker protections in the UK. Key provisions include granting day-one rights for unfair dismissal, paternity, parental, and bereavement leave, changes to sick pay and flexible working rights, protections against zero-hours contracts and restrictions on the use of ‘fire and rehire’ practices. New legislation will be introduced throughout 2025 and 2026. Further information can be found at UK Parliament: Employment rights bill and Employment Rights Bill: factsheets.

Section 1 – Key employment legislation overview

1.1 Employment law in the four UK nations

Employment law in Wales and Scotland is not devolved and therefore, unless exceptions apply, the same statutes govern employment law across England, Scotland and Wales. While statutory employment law is therefore broadly the same across the three nations, there are some notable differences in other areas of Scottish employment law when compared with England and Wales, in particular relating to employment tribunals and the general principles of contract law that apply to employment relationships.

Employment law in Northern Ireland was devolved to the Northern Ireland Assembly in 1998 and therefore, while there are many similarities, employment law in Northern Ireland differs to that in GB and is outside the scope of this guide.

1.2 Key Legislation

Key employment laws in GB, which are referenced in this guide, include the following:

the Employment Rights Act 1996 (ERA 1996);
the Equality Act 2010 (EqA 2010);
the National Minimum Wage Act 1998 (NMWA 1998);
the Working Time Regulations 1998 (WTR 1998);
the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE 2006); and
the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA 1992).

Section 2 – General principles of GB employment law

Employment rights and obligations in GB can be found in a number of places, including statute, contracts of employment and collective agreements between employers and trade unions. A lot of GB employment law is derived from EU legislation which has been incorporated into national law, although there are various instances where the UK has legislated independently of the EU. Now that the UK is no longer an EU member, it remains to be seen the extent to which GB employment law will be amended so that EU principles are no longer followed.

2.1 Employment status

In order to understand the statutory rights of an individual who is providing services to a business in GB, it is necessary to establish whether that individual is an employee, a worker or a self-employed, independent contractor.

It is important to note that in GB a person may be an employee for employment law purposes but have a different status for tax purposes. Employers must work out each worker’s status in both employment law and tax law. This guide is focused on employment status for employment law purposes rather than tax law.

2.1.1 Employee

Section 230 of the ERA 1996 defines an employee as ‘an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment.’

Determining whether an individual falls within the statutory definition of an employee is a complex issue that has been the subject of extensive litigation. Each case must be decided on its own specific facts, using the precedents established by case law. Broadly, an individual is more likely to be an employee if:

they are expected to be regularly available for work, unless on leave, and can expect work to be consistently available (‘mutuality of obligations’);
they are required to carry out the work themself (‘personal service’); and
their employer, or an employer representative such as a manager or supervisor, is in charge of the individual’s workload and how, when and where the work is done (‘control’).

2.1.2 Worker

Section 230 of the ERA 1996 defines a worker as:

‘an individual who has entered into or works under (or, where the employment has ceased, worked under)

a contract of employment, or
any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual;’

All employees are therefore also workers; however, some individuals will be defined as a worker, and not an employee, if their working arrangement is more casual than that of an employee. An individual is likely to be classed as a worker if they are required to carry out the work themself, but the work is less consistent, not guaranteed and the individual does not have an obligation to be available for work on a regular basis.

2.1.3 Independent contractor

An individual who provides their services to an organisation but is not an employee or a worker is an independent contractor. Independent contractors are self-employed and do not have any statutory employment rights or protections.

2.2 Statutory rights

Certain statutory rights in GB apply to all workers, while others apply to employees only.

2.2.1 Employee rights

Some of the key statutory rights available to employees include:

the right not to be unfairly dismissed (section 94, ERA 1996);
the right to a redundancy payment (section 135, ERA 1996); and
a minimum period of notice on termination of employment (section 86, ERA 1996);
various ‘family-friendly’ rights, including maternity, paternity and adoption leave and pay, shared parental leave and pay, parental leave and pay (Part VIII, ERA 1996); and
time off for dependents (section 57A, ERA 1996).

2.2.2 Workers’ rights

Some of the key statutory rights that are available to all workers include:

the right to be paid the national minimum wage (NMWA 1998);
the right to paid annual leave and specified rest breaks (WTR 1998); and
the right to written terms of employment (section 1, ERA 1996 ) and payslips (section 8, ERA 1996).

For further information see Checklist: Determining the difference between an employee, a worker and an independent contractor.

2.3 Contracts of employment

In addition to their statutory rights, workers in GB often gain rights from contracts of employment entered into with their employers. Contracts of employment are also where the majority of employee and worker obligations are established. They can be written or verbal and terms may be express or implied.

Employers are not able to use contracts of employment to undermine workers’ statutory employment rights; they can only supplement and improve upon the statutory requirements, which can be seen as a minimum threshold.

2.3.1 Employment contract terms required by section 1 of the ERA 1996

Section 1 of the ERA 1996 requires employers to provide all workers with a written statement of particulars of employment on or before the worker’s first day of work. The written statement of particulars must include information as specified in section 1. Further specified information must be provided to workers within two months of their start date.

Provided that the legal requirements are met, employers can decide how to present the information to workers in a way that suits their organisation.

2.3.2 Other key terms of a contract of employment

In addition to the requirements of section 1, ERA 1996, employers commonly include additional clauses in contracts of employment that are not legally required, in particular for more senior employees. These include:

confidentiality provisions;
restrictive covenants;
notice periods above the statutory minimums; and
intellectual property provisions.

For further information about drafting a contract of employment, see Checklist: Identifying, reviewing and updating the terms of an employment contract.

2.3.3 Staff handbooks

In addition to contracts of employment, employers often issue staff handbooks to employees, which contain details of non-contractual employment policies and workplace rules. For further information about staff handbooks, see Checklist: Drafting a staff handbook.

Section 3 – Rights on termination of employment

Termination of employment by the employer for any reason, including when an employer fails to renew a fixed-term contract, amounts to a dismissal under GB employment law. In contrast to some other jurisdictions, it is not possible for employers in GB to lawfully dismiss an employee without:

establishing a fair reason – this must be one of the five potentially fair reasons as set out in the ERA 1996; and
following a fair procedure.

(See section 98, ERA 1996.)

3.1 Fair reasons

The fair reasons set out in section 98 of the ERA 1996 are:

capability;
conduct;
redundancy;
illegality – this category covers scenarios where the employer discovers that the employee does not have the right to work in the UK; and
some other substantial reason (known as ‘SOSR’) – this category covers other lawful reasons that do not fall within the four more specific categories listed above. Precedent for SOSR dismissals has built up through case law and includes dismissals resulting from business reorganisations (that do not amount to redundancies) and dismissals due to personality clashes between two employees.

3.2 Fair procedure

Whether or not an employer has carried out a fair dismissal procedure will depend upon a number of factors, including the size and administrative resources of the employer’s undertaking (section 98, ERA 1996). The specific requirements for a fair dismissal procedure will therefore vary; however, certain fundamental steps must always be present to avoid an unfair dismissal finding. These steps vary depending upon the reason being relied upon, for example:

a dismissal procedure for conduct reasons almost always must involve an investigation, hearing and right of appeal; or
a dismissal procedure for redundancy almost always must include a fair selection process and consultation with the employee.

3.3 Unfair dismissal

Failing to carry out a fair dismissal can expose employers to claims for unfair dismissal, which can lead to remedies including an order for reinstatement and payment of compensation (comprised of a ‘basic award’ and a ‘compensatory award’ that may be subject to a statutory cap). Employees must normally have two years’ continuous employment with an employer in order to bring an unfair dismissal claim (although this is due to change as a result of the Employment Rights Bill), and therefore some employers choose to dispense with a dismissal procedure for any employee who does not meet this qualifying threshold. However, many employers carry out a dismissal procedure for all employees regardless of length of service, for a number of reasons, including:

to provide a defence – seeking to establish a fair dismissal can help an employer to defend a claim from a former employee for discrimination or automatic unfair dismissal, neither of which have a minimum qualifying period (further information is provided at 3.5 and 4.3 below); and
fairness – following a fair process for all dismissals regardless of service can result in a fair and transparent workplace.

3.4 Redundancy rights

Employees with at least two years’ continuous employment who are dismissed by reason of redundancy are entitled to a statutory redundancy payment on termination of employment. Redundancy payments are calculated using a formula based on age, pay and length of service. Employers and employees can use the government’s statutory redundancy calculator to calculate redundancy payments.

Many employers provide enhanced redundancy payments which are significantly more than the statutory entitlement.

3.5 Automatic unfair dismissal

A dismissal for one of the reasons specified in sections 98B to 104G, ERA 1996 is automatically unfair. If a dismissal is for an automatically unfair reason, the employee does not have to prove that the employer behaved unreasonably or failed to follow a fair procedure in order to bring a successful unfair dismissal claim. In addition, all but one of the categories of automatic unfair dismissal do not require the employee to have two years’ continuous employment. Examples of automatic unfair dismissal include dismissals for making a protected disclosure (ie, whistleblowing) and dismissals connected to pregnancy, childbirth and maternity.

Certain automatic unfair dismissal claims are not subject to the statutory cap on compensation.

For further information about whistleblowing, see How to-guide: Understanding the legal protections for whistleblowers.

3.6 Constructive dismissal

In certain circumstances, an employee’s resignation can amount to a dismissal for the purposes of GB employment law, entitling the employee to bring a claim of unfair dismissal. This is known as a constructive dismissal and occurs when the employee can establish that they resigned in response to a fundamental breach of contract on behalf of the employer.

For further information see How-to guide: How to carry out a fair termination of employment, Checklists Carrying out a disciplinary process, Conducting a redundancy exercise and Carrying out a capability process and Quick view: Collective redundancy consultation.

Section 4 – Discrimination and harassment

The Equality Act 2010 (EqA 2010) contains the majority of GB’s anti-discrimination laws.

The EqA 2010 applies to employees. However, the definition of an employee under the EqA 2010 is wider than that under the ERA 1996; meaning that in some cases an individual who is a worker for ERA 1996 purposes will be an employee for EqA 2010 purposes. The EqA 2010 also applies to job applicants (section 39, EqA 2010) and includes a mechanism under section 41 for contract workers to bring claims against a principal, extending the protection further to certain independent contractors.

4.1 Protected characteristics

The protected characteristics established by the EqA 2010 are:

race;
sex;
age;
disability;
sexual orientation;
pregnancy or maternity;
marital status;
gender reassignment; and
religion or belief.

4.2 Types of discrimination

The EqA 2010 specifies a number of different ways in which an employer might discriminate against an employee, job applicant or contractor. These types of discrimination interact with the protected characteristics listed at 4.1 above, so that an individual might have, for example, a direct race discrimination claim, an indirect disability discrimination claim or a claim for sex-based harassment, etc.

4.2.1 Direct

Direct discrimination is defined as: ‘A person (A) discriminates against another (B) if, because of a protected characteristic, A treats B less favourably than A treats or would treat others’ (section 13, EqA 2010). An example of direct discrimination would be where an employer refuses to promote an employee because of the employee’s race.

4.2.2 Indirect

Indirect discrimination is defined as: ‘A person (A) discriminates against another (B) if A applies to B a provision, criterion or practice which is discriminatory in relation to a relevant protected characteristic of B’s’ (section 19, EqA 2010). An example of indirect discrimination would be where an employer has a practice of refusing flexible working requests made by its employees. This would potentially indirectly discriminate against female employees, on the basis that female employees are statistically more likely to take on the burden of caring responsibilities outside of work and therefore require flexible working.

4.2.3 Harassment

According to section 26(1), EqA 2010:

‘A person (A) harasses another (B) if—

A engages in unwanted conduct related to a relevant protected characteristic, and
the conduct has the purpose or effect of—
1. violating B’s dignity, or
2. creating an intimidating, hostile, degrading, humiliating or offensive environment for B.’

An example of harassment would be where an employee is subjected to homophobic jokes at work.

The EqA 2010 includes separate provisions at section 26(2) and (3) relating to harassment of a sexual nature.

Section 40A of the Equality Act 2010, introduced by the Worker Protection (Amendment of Equality Act 2010) Act 2023, imposes a proactive duty on employers to take ‘reasonable steps’ to prevent sexual harassment in the workplace. This new section emphasises that employers must actively work to create a safe environment by implementing preventive measures, such as clear anti-harassment policies, training for staff, and accessible reporting mechanisms for employees to address harassment concerns. For further information, see How-to guide: How to comply with the employers’ duty to take reasonable steps to prevent sexual harassment in the workplace.

4.2.4 Victimisation

Under section section 27, EqA 2010:

‘A person (A) victimises another person (B) if A subjects B to a detriment because—

B does a protected act, or
A believes that B has done, or may do, a protected act.’

‘Protected acts’ include bringing proceedings alleging a contravention of EqA 2010, or an employee raising such an allegation of a breach of the EqA 2010 with the employer. For example, an employee is denied a promotion because they have previously alleged that they were subjected to sexual harassment by their manager.

4.2.5 Additional types of disability discrimination

In addition to the four main types of discrimination listed above, there are two additional types of discrimination applicable solely to disability. These are:

discrimination arising from disability – this occurs where ‘A treats B unfavourably because of something arising in consequence of B’s disability’ (section 15, EqA 2010). For example, an employee with a disability is dismissed because of their poor absence record that has arisen in consequence of their disability; and
failure to make reasonable adjustments – this occurs where an employer has a duty under the EqA 2010 to make a reasonable adjustments in order to avoid a substantial disadvantage to a person with a disability and fails to do so (section 20, EqA 2010). For example, an employer unreasonably refuses to install a ramp for an employee who requires a wheelchair, or a job applicant with dyslexia is not allowed additional time to complete a written test.

4.3 Discrimination claims

Under section 109, EqA 2010, employers are vicariously liable for the actions of their employees, subject to a defence that the employer took ‘all reasonable steps’ to avoid the actions of the employee in question (this might be established, eg, through anti-discrimination policies and staff training).

Discrimination claims are often complex and difficult to deal with. It is common for employees to:

bring allegations of multiple types of discrimination within the same claim (eg, a claim alleging indirect disability discrimination, discrimination arising from disability and failure to make reasonable adjustments or a claim for direct sex discrimination and sex-based harassment;
bring claims that rely on more than one protected characteristic (eg, sex and maternity or race and disability);
bring claims against multiple respondents (eg, the organisation that employs them, their direct manager and the managers that dealt with a disciplinary or grievance process relating to them); and
bring a discrimination claim while remaining employed by the employer.

There is a statutory defence available for certain types of discrimination claims (eg, indirect discrimination and discrimination arising from disability) if the respondent can establish that it invoked a proportionate means of achieving a legitimate aim. For example, a legitimate aim might be ensuring sufficient staff cover for efficient running of the business, with the proportionate means being declining certain types of flexible working requests.

There is no qualifying period of employment or service for a discrimination claim – the right to bring a claim under the EqA 2010 arises from day one, and in fact before then as individuals can allege that they were discriminated against or harassed during a recruitment process. Unlike ordinary unfair dismissal, there is no cap on the compensation that an employment tribunal can award to an employee who brings a successful discrimination or harassment claim. Legal fees for defending discrimination and harassment claims are also significant.

Discrimination claims can cause significant disruption to an organisation and can also attract adverse publicity for an organisation.

For further information see How-to guides Overview of workplace discrimination and harassment law, How to avoid disability discrimination in the workplace, How to comply with the duty to make reasonable adjustments in the workplace and How to avoid religion or belief discrimination in the workplace and Quick views: Protected characteristics under the Equality Act 2010 and Understanding and navigating gender-critical beliefs in the workplace.

4.4 Equal pay

Chapter 3, Part 5 of the EqA 2010 gives women and men the right to equal pay for equal work, which includes like work, work rated as equivalent and work of equal value. Equal pay litigation often involves group actions by large groups of employees, often backed by trade unions, against local authorities, supermarket chains and other large organisations. Equal pay claims are also brought by individual claimants who have identified a colleague of a different sex who has better terms and conditions of employment. Equal pay claims can only be brought on the basis of sex; if the difference in pay is said to have been because of a different protect characteristic (eg, race or disability), then the claim must be brought as a discrimination claim.

Section 5 – Employee and worker rights during employment

Employees and workers in GB have various statutory rights that apply to their employment. Some rights are available only to employees, with others applying to the wider category of workers. Employers often enhance these statutory rights (eg, by giving employees additional maternity pay, or more paid annual leave than the statutory requirement). Some key rights are set out below.

5.1 Family-friendly rights

Employees in GB are entitled to various types of time off (paid and unpaid) in connection with childbirth and caring for dependents. The key rights are set out in Part VIII, ERA 1996 with additional detail found in regulations including the Maternity and Parental Leave etc. Regulations 1999 and the Shared Parental Leave Regulations 2014 (SPLR 2014).

Key family-friendly rights include:

maternity leave – qualifying employees are entitled to 52 weeks’ maternity leave. Employees may also be entitled to up to 39 weeks’ statutory maternity pay at a rate set by the government;
adoption leave – qualifying employees are entitled to 52 weeks’ adoption leave. Employees may also be entitled to up to 39 weeks’ statutory adoption pay at a rate set by the government;
shared parental leave – shared parental leave is a relatively new concept that was introduced in GB law via the SPLR 2014. It allows qualifying parents to split a total leave entitlement of 50 weeks between them following the birth of a child. Shared parental leave is a flexible entitlement that can be taken in blocks separated by periods of work or taken all in one go. Parents can also choose to be off work together or to stagger the leave and pay. Parents may also be entitled to up to 37 weeks’ shared parental pay at a rate set by the government;
parental leave – not to be confused with shared parental leave, parental leave entitles employees who are parents to unpaid leave of up to 18 weeks per child, to be taken by the child’s 18th birthday, for the purposes of looking after the child’s welfare. Leave must be taken in blocks of one week or more and there is a limit of four weeks’ leave per year for each child. Detailed information on leave duration can be accessed here;
paternity leave – qualifying employees are entitled to take one or two weeks’ paternity leave because their partner is having a baby. Employees may also be entitled to paternity leave at a rate set by the government;
parental bereavement leave – this new right entitles qualifying parents to up to two week’s leave upon the death of their child under the age of 18 or a stillbirth after 24 weeks of pregnancy. Parents may also be entitled to statutory parental bereavement leave at a rate set by the government;
carer's leave – introduced by the Carer’s Leave Act 2023 and effective from 6 April 2024, this right allows employees to take up to one week of unpaid leave per year to care for dependents with long-term care needs. This leave can be taken flexibly, in blocks or as individual days; and
right to request flexible working – qualifying employees are entitled to request a change in their terms and conditions of employment (eg, part-time working, home working or adjusted start and finish times), which an employer 1) must deal with in a reasonable manner and 2) can only reject for one (or more) of a list of reasons specified in section 80G, ERA 1996.

Employees are also entitled to unpaid time off work for a variety of reasons, including to care for dependents in emergency situations and attend ante-natal appointments.

5.2 Minimum wage

The NMWA 1998 entitles qualifying workers to be paid the national minimum wage as set by the Secretary of State. Details of the current national minimum wage, which increases each year, can be found on the government website.

5.3 Working time

The WTR 1998 apply to all workers and set out provisions in relation to:

maximum weekly working hours (with an option for workers to opt-out if they choose to);
holiday entitlement;
rest break entitlements;
maximum working hours for young workers; and
limits on night work.

Information about the current requirements relating to working time can be found on the government website.

5.4 Statutory sick pay

Employees who are absent from work due to incapacity are entitled to be paid statutory sick pay (SSP). Information about the current entitlement and rate of SSP can be found on the government website.

Section 6 – Worker representation

Many employees and workers in GB are members of trade unions. The role of a trade union in a workplace depends on whether or not the trade union is recognised by the employer. The majority of legislation relating to trade unions is contained in the TULRCA 1992.

6.1 Trade union recognition

A trade union that is ‘recognised’ by an employer has the authority to negotiate with the employer in relation to pay and other terms of employment on behalf of a group of workers, known as the ‘bargaining unit’. This process is known as ‘collective bargaining’ and leads to the production of collective agreements, which supplement the terms and conditions of employment of the workers in the relevant bargaining unit. A recognised trade union is also entitled to represent employees during any consultation process relating to collective redundancies and transfers of a business.

Employers can agree to recognise a trade union in response to a written request from the trade union for voluntary recognition.

When an employer refuses a request for voluntary recognition, the trade union can apply to the Central Arbitration Committee for statutory recognition.

(See schedule A1, TULRCA 1992.)

6.2 Rights of trade union members

Individuals who are members of trade unions have a number of protections, including:

the right not to be refused employment due to union membership (section 137, TULRCA 1992);
the right not to be subjected to a detriment due to being a member of a trade union or taking part in trade union activities (section 146, TULRCA 1992); and
enhanced protection against dismissal (section 103, ERA 1996 and section 152, TULRCA 1992).

Union representatives in workplaces where the union is recognised have:

a right to paid time off to carry out trade union duties; and
a right to paid time off for training (section 168, TULRCA 1992).

6.3 Industrial action

Industrial action is sometimes organised by trade unions in response to a dispute with the employer that cannot be resolved through negotiations. Industrial action can involve a strike or action short of a strike, such as working to rule.

Part V of TULRCA 1992 sets out detailed requirements that trade unions must comply with when organising industrial action including, in particular, holding a ballot that:

is supervised by a qualified independent person;
complies with specified timescales; and
includes necessary information about the ballot and how members can vote.

Section 7 – Employee rights on the transfer of a business

The TUPE 2006 may apply when:

all or part of a business is sold or otherwise transferred to a different legal entity; or
services previously undertaken in-house are outsourced to a contractor, or outsourced services are brought in-house or passed to a new contractor.

When TUPE applies this is known as a ‘TUPE transfer’. The purpose of TUPE is to protect the employees if the business, or part of a business, in which they are employed moves to a new owner in one of the ways listed above.

Identifying a TUPE transfer is a complex matter; however, when TUPE does apply the impact is significant:

employees who are employed in the business or part of a business (known as the ‘undertaking’) being transferred will automatically transfer to the new employer;
employees who transfer do so on their existing terms of employment with their employment rights and liabilities, including their continuity of service, intact (regulation 4, TUPE 2006);
employees who are dismissed will be unfairly dismissed if the principal reason for the dismissal was the transfer (regulation 7, TUPE 2006);
employees who transfer under TUPE have enhanced protected against dismissal following a TUPE transfer (regulation 7, TUPE 2006);
there are significant limits on the new employer’s ability to change the terms of employment of employees who transfer under a TUPE transfer (regulation 4, TUPE 2006);
TUPE can apply when the outgoing employer is in insolvency proceedings (regulation 8, TUPE 2006);
both outgoing and incoming employer are subject to obligations to inform and consult with the employees subject to a TUPE transfer (regulation 13, TUPE 2006), and the outgoing employer has a duty to provide specified information about the employees to the incoming employer (regulation 11, TUPE 2006).

For further information, see Checklist: Carrying out a TUPE transfer.

Section 8 – Employment disputes

There are a number of ways in which employment related disputes might be resolved, ranging from internal grievance processes to employment tribunal claims.

8.1 Grievances

Employers are required by section 3, ERA 1996 to provide workers with details of ‘a person to whom [the worker] can apply for the purpose of seeking redress of any grievance relating to his employment’. When an employee raises a grievance, employers should ensure that a grievance process is followed, which as a minimum should include an investigation, hearing and right of appeal. Failure to properly deal with grievances can significantly reduce an employer’s ability to defend claims such as discrimination and constructive unfair dismissal.

8.2 Acas

The Advisory, Conciliation and Arbitration Service (known as Acas) is an independent public body that receives funding from the government. The role of Acas includes:

providing free information and support to employers and employees primarily through its website and helpline;
producing codes of practice, such as the Acas Code of Practice on disciplinary and grievance procedures. The Codes are not legally binding, but whether or not an employer followed an applicable Acas Code can be relevant in determining whether or not an employer can successfully defend an employment tribunal claim and can also impact upon the amount of compensation awarded to an employee;
helping to resolve workplace disputes and settle employment tribunal claims through informal conciliation, mediation and arbitration; and
conducting ‘early conciliation’, which is a pre-requisite to issuing a claim in an employment tribunal.

8.3 Employment tribunals

Where an employee or worker is unable to resolve a workplace dispute through informal means or Acas conciliation, they may issue an employment tribunal claim. Employment tribunal claims follow a formal process similar to that found in the civil court system, usually involving disclosure of documents, exchange of witness statements and one or more hearings with an employment judge and, in some cases, panel members. Employment tribunal decisions can be appealed to the Employment Appeals Tribunal and further to the Court of Appeal and the Supreme Court.

8.4 Settlement agreements

Settlement agreements are a commonly used mechanism for settling employment disputes and can be entered into at any time during or after employment. Settlement agreements generally involve the employee or worker agreeing to waive their right to bring an employment tribunal claim or to proceed with a claim already issued, in return for a sum of money paid by the employer or former employer. Settlement agreements are often used at the point an employee’s employment is terminated, in order to protect the employer from the risk of future claims and to provide certainty to both parties going forward.

For further information, see How-to guide: The framework for resolving employment disputes in England and Wales.

This How-to guide was produced in conjunction with Michael Salter of 42BR Barristers.