UNIONS and opposition parties have slammed a Government report that said unproductive workers should lose the right to claim unfair dismissal and companies should be able sack employees without explanation.

The leaked report, commissioned by the Prime Minister, says scrapping unfair dismissal would free up business, boost economic growth and allow more capable people to replace those who were sacked.

The report, by venture capitalist and Tory party donor Adrian Beecroft, says some staff were allowed to “coast along” with some proving impossible to sack. But unions said the move would “horrify” workers and the SNP condemned it as “ludicrous”.

The document said the first major issue for British enterprise was the “terrible impact of the current unfair dismissal rules on the efficiency and hence competitiveness of our businesses, and on the effectiveness and cost of our public services”.

TUC general secretary Brendan Barber said: “Scrapping protection against unfair dismissal will do absolutely nothing to boost the economy. If people are constantly in fear of losing their jobs, it will lead consumers to spend even less.

“Employers already have plenty of powers to make fair dismissals. Giving them the right to act unfairly may go down well on the back benches, but will horrify employees.”

Paul Kenny, general secretary of the GMB union, said it was no surprise that a “well-heeled Tory venture capitalist” should want the Tories to make it easier for workers to be sacked.

The Beecroft report said managers in the public sector had been forced to offer under-performing staff large settlements because they feared costly tribunal rulings. It added: “A proportion of employees, secure in the knowledge their employer will be reluctant to dismiss them, work at a level below their true capacity; they coast along.”

Mr Beecroft argued there was nothing to prevent the Government scrapping unfair dismissal laws. Rules preventing dismissal on the basis of a person’s gender, race or sexuality would remain, and he warned that simply abolishing the law would be “politically unacceptable”.

He suggested replacing it with Compensated No Fault Dismis-sal, which would allow employers to sack staff with basic redundancy pay and notice.

Mike Weir, the SNP’s business spokesman, said: “This is a ludicrous proposal. Protection from unfair dismissal is an important employee right.”

Labour’s shadow business minister, Ian Murray MP, said: “We should make it easier to hire people, not easier to fire them.”

Jo Swinson, the Scottish LibDems deputy leader, said the UK Government was taking steps to help businesses and free them from unnecessary regulation, but that didn’t include allowing people to be sacked with no questions asked.

Scottish Tory justice spokesman John Lamont said there was “a case to be made for loosening employment law so the balance is tipped slightly less in favour of the employee”.

Iain McMillan of CBI Scotland, said: “If employees are not pulling their weight that should be explained to them. They should be given time to correct their behaviour and if they don’t do that they should be given a series of written warnings and the opportunity to improve before dismissal takes place.”

Downing Street said changes to the unfair dismissal rules were “unlikely”.

 

The change to employment rights

FOR: LIZ CAMERON

A NEW dismissal route that provides clarity for all parties would give employees, employers and -- importantly -- potential employers, confidence there is a regulatory framework that is fair on all sides and provides a process for all potential scenarios.

It is right that regulations are revised regularly to ensure the framework reflects the reality of businesses’ operating environments. We welcome the Beecroft report’s contribution to that review process. Engagement with business on the regulation that affects them is crucial.

  • Liz Cameron is chief executive of the Scottish Chambers of Commerce.

 

AGAINST: IAN TASKER

RESEARCH by the Organisation for Economic Co-operation and Development could find no link between levels of employment protection and economic growth and we would doubt this report will deliver any evidence to the contrary.

The STUC believes this work exposes the ideology of the Coalition Government, namely to develop an economy where all the power is in the hands of the few and where the efforts of rogue employers undermine the efforts of those who want to engage with trade unions and respect fundamental employment rights.

  • Ian Tasker is assistant secretary of the Scottish Trades Union Congress.