January 2006

Information and Consultation of Employees Regulations 2004

From 6 April 2005 employees in businesses which employ greater than 150 have the right to be informed and consulted on a regular basis about issues which will effect the organisation which they work for. In April 2007 this threshold will be reduced to businesses employing only 100, and finally in April 2008 it will reduce to just 50. But what does this really mean for employers and employees?

What does information and consultation mean?

The requirements for employers under the new regulations are meant to encourage agreement over information and consultation arrangements. Regulations already exist to protect employees where businesses are transferred, however, it is hoped the new regulations will spread this culture through to the more mundane decisions behind running a business.

The key element of the new regulations is the question of consultation. How far must an employer take the process? What are the issues of confidentiality which exist around any major commercial decisions and which clearly run against the idea of consultation with the workforce at large?

Our Commercial and Employment departments will help to answer these questions and address the queries which they raise.

What is the minimum that employers are required to do?

The regulations require that the employer communicates clearly and unambiguously with the representatives of their workforce. This communication must include information about the business's activities and economic situation in general. The Regulations require the employer to consult their employees on any changes to the business's organisation or, crucially, to the employee's contractual relationships with the business.

What do Employers need to know?

Employers are able to initiate the programme themselves, alternatively however they can wait for the requirements to be automatically triggered by a request from any 10% of their employees. If the workforce acquiesces, any existing written arrangements concerning the dissipation of information may continue unaffected by these new regulations. But employers should be aware that these arrangements are now required to be expressed in writing. Failure to comply with the regulations may result in a fine being imposed.

The regulations are only intended as a last resort where the employees feel that they are left with no other options. At Baily Gibson we believe that an established and well organised communication system between the hierarchy of a business of any size is vital to the health of that business. We will be glad to advise on a easy and maintenance free way of implementing this.

What do Employees need to know?


Under the new Regulation every employee in any business (with the requisite number of employees) has a right to information and consultation. However, the requirements of the Regulation are not imposed automatically and are only triggered once the employer has received a request for the implementation of an information and consultation arrangement from at least 10% of the workforce. Businesses are still able to agree an arrangement voluntarily and this will usually be the best option for all concerned.

It is important that employees realise their rights and that employers work together with the individuals they employ at all stages of the commercial process. At Baily Gibson we pride ourselves on being able to approach employment issues from both sides and work together to reach an amicable conclusion.

For more information please contact Thomas Crown on 01494 442661.