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Agenda item 2 is consideration of an affirmative statutory instrument: the Employment Tribunals Extension of Jurisdiction (Amendment) (Scotland) Order 2026. That is a bit of a mouthful. I refer members to paper 1. I welcome Tom Arthur, the Minister for Business and Fair Work, and officials from the Scottish Government: Alison Moore, fair work and labour market team leader in the jobs and wellbeing directorate, and Susan Robb, solicitor.
I remind members that Scottish Government officials can participate in the initial evidence session but only MSPs can participate in the formal debate when we move to agenda item 3.
I invite the minister to make a short opening statement.
Good morning. Thank you for giving me the opportunity to speak on the Employment Tribunals Extension of Jurisdiction (Amendment) (Scotland) Order 2026.
The order seeks to make a straightforward but important change to the time limit that applies to contract of employment claims in employment tribunals in Scotland. Currently, employees have three months to bring such claims. The order will extend that period to six months. The purpose of that change is to align time limits for contract of employment claims in Scotland with time limits for other employment tribunal proceedings, following the introduction, through the Employment Rights Act 2025, of wider reforms across Scotland, England and Wales. It will ensure that workers and employers in Scotland benefit from a consistent approach to tribunal time limits.
Before I turn to the benefits of the change, I should note that ministers explored whether commencement could be aligned across England, Wales and Scotland by asking the United Kingdom Government to consider delaying the corresponding provisions for England and Wales. In doing so, we highlighted that the Scottish Parliament election and the summer recess placed significant constraints on the available parliamentary time. In March 2026, the UK Government confirmed that it intended to retain its planned commencement date of 1 October 2026. Consequently, the order was introduced at the earliest practical opportunity.
For many people, workplace disputes can be stressful and difficult to navigate. Someone who has lost their job or experienced a breach of contract of employment might need time to seek advice, understand their rights and consider their options. Extending the time limit from three months to six months will give people greater opportunity to do so. The change should also allow more time for workplace issues to be resolved, possibly avoiding the need to resort to a tribunal. In many cases, disputes can be settled through internal procedures or through an Advisory, Conciliation and Arbitration Service early conciliation, helping employers and employees to find a resolution without the need for formal legal proceedings. It is important to be clear that the order does not create any new employment rights, nor does it change the role of employment tribunals; it simply extends the period in which a breach of contract of employment claim can be brought.
The proposal is a technical amendment with no significant financial implications, and assessments have concluded that it has no impact on children’s rights. Ultimately, it is about improving access to justice, giving individuals a fairer opportunity to pursue their existing rights and ensuring consistency across England, Wales and Scotland. It is a practical and proportionate change that will benefit both workers and employers. I commend the order to the committee and am happy to answer any questions that it might have.
Thank you for your statement, minister. Colleagues, do you have any questions?
Good morning. The bit that interests me is whether the workplace issues that are happening right now will be resolved. Will some be thrown out because they have not made the deadline? Will some incur more costs? How did you come to the conclusion that this was the right thing to do? To me, it looks like there is a policy point that divides between ensuring that issues are resolved internally through an ACAS conciliation, on one hand, and helping workers and strengthening their rights, on the other. How did you come to understand that the order would be beneficial for Scotland?
On cases that are potentially live now, I draw your attention to the transitional provisions that are contained in the amendment order.
I am also conscious—although I know that you did not ask about this specifically—of the time difference in commencements between 1 October and 9 November. We sought to avoid that difference, but it is a practical consequence of the electoral cycle in which we found ourselves as we went into the May election. We have worked at pace to introduce the order at the earliest possible opportunity.
I touched on the fact that this is about consistency of approach across England, Scotland and Wales. The nature of the provisions is such that ministers must make the order with the agreement of the Secretary of State. That agreement has been sought and confirmed, which is why we are able to introduce the order.
We are moving the time limit for claims from three months to six months, which brings wider consistency with similar measures, as I said in my opening remarks. Although the order does not ultimately necessitate that an individual pursue a particular means of addressing or remedying instances that they find unsatisfactory, it provides the opportunity to engage through processes of conciliation, whether internal or otherwise. Fundamentally, that gives greater flexibility.
It should also be recognised that, even with the existing Employment Tribunals Extension of Jurisdiction (Scotland) Order 1994, which set out a three-month limit, there is the opportunity for flexibility—if individuals seek it and permission is granted.
I ask officials to give a bit more detail on the flexibility that exists, to provide clarity about what is changing legally and how that compares to what is changing practically.
There is currently provision to extend the timescale if someone requests it, so the period may be longer than three months. However, the change under the proposed order will ensure that the longer period of six months will always be available if it is needed. That is not to say that issues cannot be resolved before then, but people will have a longer period of time if they need it.
I would like further detail. My concern is that it will take longer for current workplace issues to be resolved. I am not objecting to the change in any way—it is good to have a consistent approach in England, Wales and Scotland. I am simply interested in the details of the change. An opportunity to resolve workplace issues internally will cut the number of tribunals, but this could also be detrimental to people who are currently in the queue. An issue will take longer to resolve and may incur further costs. I just want to put that on the record.
It is an interesting point, which is applicable not only to this matter. When we are considering any period of prescription in a statute of limitations, there is a question as to where we set a particular deadline. Does this change incentivise people to work in a more focused way to find informal internal means of addressing the issues that have given rise to the complaint, or do people ultimately just roll with it? Do they feel incentivised to resolve the issue internally and that a longer deadline provides more space for that internal conversation? Does a shorter deadline ultimately push people into formal proceedings? There are arguments both ways, and your point touches on a number of areas in which a time limit of any sort is drawn with regard to when one can seek to enter formal proceedings. Ultimately, it is a question of judgment.
As I tried to convey in my opening remarks, this change brings a degree of consistency, so that the approach is consistent with that of the other nations in Britain. To go back to Susan Robb’s point, existing provisions offer the opportunity to seek an extension. Therefore, I think that the new approach is proportionate and balanced, and that it—I reiterate—brings a degree of consistency with the other parts of Great Britain.
I will come in on that point with a more general question that builds on the theme that Rachael Hamilton talked about. In the programme for government, minister, you set out a commitment to reduce bureaucracy and align with better regulation principles such as regulating last, regulating simply and regulating flexibly. Did you assess this regulation against that desire as set out in the programme for government?
The focus on the better regulation principles in the programme for government is an ongoing process. There was a real focus on it during the early to mid part of the previous parliamentary session. For example, the new deal for business process involved a lot of concentrated work in partnership with business to identify opportunities to consider not only existing regulation but, importantly, the processes by which future regulation would be considered. That is reflected in the programme for government and will inform and shape the Government’s approach to regulation as we move forward.
With this change, we will see consistency more broadly within the changing employment rights landscape, as we have seen with the Employment Rights Act 2025. We very much welcomed the 2025 act. We felt that it could have included stronger interventions, but it nonetheless represents progress. Fundamentally, in many respects, it put a lot of what we have been trying to achieve through our fair work principles and conditionality in grant funding on a statutory footing. As such, we saw it as beneficial; its requirements provided clarity and helped to create a level playing field for those who voluntarily pursue fair work objectives in line with what the Scottish Government seeks to incentivise. The 2025 act should always be envisaged as a floor rather than a ceiling.
More broadly, we are thinking in a careful and considered way about the proportionality of regulation in the employment rights landscape. We want to ensure that regulation is undertaken in the context of our fundamental aim during the current parliamentary session, which is to grow the economy, as we recognise how important that is to achieving all the other outcomes that we wish to realise over the next five years. Proportionality around all regulation is important. Although that approach to proportionality predates this parliamentary session, it is reflected in the programme for government and is, of course, brought to bear in any ministerial deliberations with regard to introducing regulations.
Okay, thank you. There are questions on this from all members. I will bring in Martyn Day first.
09:45
I think that this change is broadly positive and I am grateful for the minister’s explanation, as it answered most of the questions that I had. However, there is one outstanding area that I would like clarity on. How will workers and employers be informed when this new six-month limit applies? Also, will there be any mitigation or confusion in relation to the earlier English start date?
The point about avoiding confusion with the start date for England—and, indeed, Wales—is an important one. I do not want to get ahead of myself, as this is subject to the agreement of Parliament. However, should the committee agree and should Parliament ultimately approve this order, the Government would, of course, seek to communicate in the usual ways. It would be confirmed as having been approved by Parliament, and it would come into effect on the designated date.
I am happy to ensure that we engage with the appropriate authorities so that the correct notification takes place. Understandably, the order will be on the radar of relevant parties and those with relevant interests. They will be monitoring its progress through Parliament, and that would naturally be disseminated through their networks without any involvement from Government. However, I am happy to consider what more could be done to support Government communications on the matter, subject to the agreement of Parliament on passing the order.
There is no sense in me asking my question now, as I have found the answer.
I have no questions either.
This order is undoubtedly welcome. Having more time to lodge proceedings with employment tribunals clearly gives more flexibility—I think that three months is very short. However, we know that an increasing volume of cases are being brought to employment tribunals. I am interested in the Government’s view on the possible impact of the change on that volume and on the projected resolution of employment claims. Also, given that there are additional, and very welcome, rights coming from the Employment Rights Act 2025, are there any other workload considerations? Ultimately, a swift resolution to these matters is important and throughput is an important consideration.
I covered some of those points in my supplementary answer to Rachael Hamilton, recognising that, in other areas, the desired outcome and intention of deliberations around extending timelines have been to provide more opportunity for internal resolution by giving a greater period of time in which someone can consider whether to pursue a matter formally. As such, one would hope that extending that window from three months to six months—not discounting the existing provision for an extension to be sought—would afford a greater opportunity for matters to be resolved without the need to bring them into formal proceedings.
To be clear, those formal proceedings exist in statute. If this order is passed, the timescale for them will extend from three months to six months. I do not want anything that I say to be construed as suggesting that they are not an appropriate avenue or channel for someone to pursue—it is there in law. However, one would hope that, with that longer time period, the greater opportunity for resolution short of formal proceedings could have a positive impact on the workload that was being generated.
On your broader point about understanding the implications of the strengthening of employment rights following the 2025 act, we will have to see how that plays out. The act was passed last year, but some of the provisions will take time to come on stream, so we will have to pay careful attention to and monitor what happens. The committee will understand that this is a reserved area of legislation, but we need to recognise where it interacts with devolved competences as well. We will continue to monitor the situation. If there are indications that additional resource is required, ministers will consider that.
Alison, do you want to say more about the Government’s role in monitoring any demand that might be generated as a consequence of the Employment Rights Act 2025?
As the minister said, employment law is a reserved area, but we are engaging with United Kingdom Government officials to ensure that there will be no issues and that no further backlogs will build up because of the time limit being extended. We will keep that under review and will raise any issues with the UK Government to ensure that resolutions are put in place. We do not want the time limit extension to cause any further difficulties; we want it to streamline the process for individuals and employers.
I have found another question for the minister.
I agree with the order and think it is positive. My understanding is that one reason for the extension is that three months is a very short period for an employee to reflect on what happened when they lost their employment or when there was a breach in their employment. I think that giving people six months will do one of two things: it will either allow them to move forward to an employment tribunal, or it will give them a bit more time to take advice so that they can do the right thing. Is that a reason why the change is coming in?
I am not sure that it will lead to more tribunals, because, after reviewing the situation, more people might not want to go forward, even if some still do.
That is a key point. The change will give people more time to consider their options and to think about whether and how they wish to pursue a tribunal. It will give greater flexibility.
As I said, in any consideration of the time period during which one is afforded the opportunity to exercise a particular right, there is a balance between affording rights and opportunities to the individual who might wish to utilise the process and providing certainty for the organisation that might be subject to that process. Those considerations must always be taken into account.
I spoke earlier about generalities. Those instances can bring opportunities to pursue the matter via other means. I am not speaking specifically, but an organisation may have internal processes, or an individual may wish to pursue or explore other means. This is about giving flexibility. It is a proportionate intervention that brings a degree of consistency with what we will see being implemented in England and Wales next month.
Dare I use the expression “common sense”? That is what it sounds like to me.
We now move to formal consideration of motion S7M-01019.
Motion moved,
That the Economy, Tourism and Energy Committee recommends that the Employment Tribunals Extension of Jurisdiction (Amendment) (Scotland) Order 2026 [draft] be approved.—[Tom Arthur]
As no members wish to make any other points, I invite the minister to wind up.
I thank members for their consideration and press the motion.
The question is, that motion S7M-01019 be agreed to. Are we agreed?
Members indicated agreement.
Are members agreed to delegate authority to me, as convener, to produce a short factual report on the instrument?
Members indicated agreement.
I thank the minister and his officials for their time. I will briefly suspend the meeting to allow them to leave, and we will continue shortly.
09:54
Meeting suspended.
09:58
On resuming—
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