UK: Redundancy consultation law to change

UK to hike penalties for improper redundancy consultation to 180 days' pay. May we be seeing first steps in of domestic “works councils” in the UK and Ireland, even if they are not called that?

Key points:  UK government plans to double the maximum protective award for improper redundancy consultation to 180 days' pay. Changes aim to encourage proper consultation and potentially lead to the establishment of permanent employee representative bodies. See the Lewis Silkin report on the changes to UK law on collective redundancy consultations

Why this matters:  There is a growing suggestion that employers could be tempted to set up standing bodies of elected, employee representatives to avoid having to run elections every time a collective redundancy is contemplated. Would such bodies seek to extend their remit beyond collective redundancies and become de facto works councils? The same could happen in Ireland as a result of various EU laws requiring information and consultation, such as Pay Transparency. Could we be about to see the emergence of domestic “works councils” in the UK and Ireland, even if they are not called that? 

Also happening in U.K.:  The U.K. government has announced that companies with over 250 employees will be required to disclose whether their white workers earn more than their ethnic minority counterparts. The initiative aims to address pay disparities and is part of a Labour manifesto pledge. The Office for National Statistics reported that in 2022, black workers earned approximately 6% less than white employees. Asian or Asian British employees, meanwhile, earned about 3% more than white employees.  See this Lewis Silkin LLP note for more details.