Tag Archives: dismissal

Let’s Settle This!

Posted on by • Posted in HR Tips for Business and Charities • Tagged , , , , • 1 Comment

As with much of employment law, many of the small businesses I work with have heard of Settlement Agreements but aren’t quite sure exactly what they are. Recently I’ve had a couple of cases where clients have had concerns that discussing a settlement with an employee will be interpreted as a sign of “weakness”. This is the first part of a two part post (second part later this week), which looks at what they are and when and how they can be useful.

Firstly, you may be more familiar with their old name – Compromise Agreements – which was changed a couple of years ago as many people felt that “compromise” suggested that they had somehow “given in”. They are a legally binding agreement between an employer and an employee to end an employment contract, usually in a situation where there is some dispute between them.

The advantages for employers in this situation are:

  • No risk of a subsequent employment tribunal
  • Ends the relationship swiftly, allowing you to concentrate on running the business not dealing with an employee problem
  • Avoids any potential issues of bad publicity or reputation damage

There are disadvantages however

  • You may have to pay out more to the employee than you would contractually be obliged to
  • You may be expected to contribute to the employee’s legal fees
  • You may have to make certain commitments (e.g. provide a reference) that you might not otherwise want to
  • It is voluntary – you cannot force an employee to agree to one

To be legally binding, a Settlement Agreement must be in writing, contain certain clauses and most importantly the employee must have received independent advice from a qualified solicitor*, who must also countersign the agreement. Employers do not have to have employment law advice on the agreement (though many do) and there’s no requirement for their adviser to sign. A settlement agreement does not have to be a long winded legal document however – it’s perfectly possible to create a valid one on a side of A4.

But hang on, you may be thinking – “why don’t I just dismiss the individual? After all, didn’t you say in this post that it wasn’t as complicated and scary as many employers think?”

Clearly, you can just do this – but in many situations Settlement Agreements can be the better solution for both parties. And in part 2 of this blog post we’ll show you how to negotiate one.

*A qualified solicitor is one who has specific insurance which allows them to advise on employment matters. It is designed to protect the employee in the event of negligent legal advice. There are also certain others who are allowed to countersign settlement agreements such as CAB legal advisers, or some Trade Union officials

The Clarkson Affair – what small employers really need to know

Posted on by • Posted in HR Tips for Business and Charities • Tagged , , , , , , , • Leave a comment

The suspension of TV presenter Jeremy Clarkson from Top Gear, after what’s been described as a “fracas” with his producer, has caused a huge amount of discussion, media comment and online debate. (If you’re one of my non-UK readers, or have been avoiding the news for the past week, here’s a summary of the story)

In adding to the already large amounts of discussion on this story, I’m aiming to provide a reminder for small organisations of the process for dealing with such a situation – while not all that common it happens more often than you may think.

Firstly, you need be clear to all staff about what behaviour is unacceptable. Most organisations would class fighting or physical assault as gross misconduct, which is likely to lead to dismissal without notice (people sometimes refer to this as “summary” or ” instant” dismissal – however as you have to undertake a proper process before dismissing, I avoid these terms as they imply that you make a knee-jerk decision). Many organisations would also class threatening verbal abuse as gross misconduct, especially if it has (as some versions of the story suggest) a racial element.

Even if you don’t classify it as gross misconduct, it’s unlikely to be acceptable behaviour and might well lead to disciplinary action – and if you have someone  already on a final warning (again, as Mr Clarkson apparently is), further disciplinary action is also likely to result in dismissal.

If you are considering gross misconduct, you should normally suspend the individual while you investigate matters. Someone’s job is at stake so it’s important that you talk to any witnesses or consider any supporting documentation. You may also want to talk to the individual themselves as part of the investigation although this isn’t always necessary. Make sure any meetings are documented. If your organisation is large enough, get someone to carry out the investigation who isn’t connected to the incident or who won’t be involved in the final decision.

At the end of the investigation, if there seem to be grounds for gross misconduct, call a disciplinary hearing and ensure the individual has access to all the allegations before the hearing. Remember, you must allow them to put forward their side of the story or any mitigating circumstances before you make the final decision.

And if you do dismiss, then the individual must be allowed an appeal, usually to someone not involved in the final decision – although in a very small organisation this isn’t always possible, but in this case you should allow the opportunity to request a review of the decision.

Without knowing all the ins and outs of the Clarkson case (we only have partial media reports), it does seem the BBC is doing things “correctly”, even if this upsets those who want to see Clarkson either back on TV or dismissed immediately. And it’s a reminder that no matter how valuable an individual employee is to the company, they aren’t above the normal standards of behaviour.

If your company needs help with handling a disciplinary case, why not get in touch?

(NB – some may point out that Clarkson is not a BBC employee but a freelance contractor. I understand that because of the large numbers of freelance contractors in the media industry, the BBC policy is to cover both employees and contractors. However, you don’t need to follow such a process with any freelance workers you use in your business, only those who are directly employed by you)

Updated 25/3/15

The decision has been made and it seems that not only have the BBC carried out a full and proper investigation of the issues, they’ve also carried out the process in a fortnight, which gives the lie to those who suggest that suspensions and investigations drag out things unnecessarily!

Sacking someone? It’s just like making Risotto

Posted on by • Posted in HR Tips for Business and Charities, Work Related Posts • Tagged , , , , , • 4 Comments

Watching one of Nigella Lawson’s cookery programmes (yes I do, what of it?) I was struck by one of her comments that when it comes to cooking, “people confuse time-consuming with difficult”.

It seems to me that this is the same mistake that a lot of businesses apply to HR – and sadly it’s an illusion that many in HR like to perpetuate.

Take dismissing someone for example. “It’s hard to do” say some small business organisations and government ministers. “It should be made easier”

Actually, it isn’t hard to do. If you have an employee who can’t do the job, regularly breaks rules, is no longer able to work for you, undertakes tasks you no longer require, or with whom your working relationship has fundamentally broken down, then you can dismiss them. The time consuming but not difficult bit is that you have to follow a fair process before you make your decision. That means allowing the individual to put forward any mitigation at a hearing, letting them attend with a colleague or union rep and, if you do dismiss, allowing them an appeal.

Even the infamous TUPE regulations, which cause so many sleepless nights for employment lawyers and HR people, are – in 90% of cases – simply a tick box exercise: Have you consulted employees at the correct time? Have you supplied employee information at the correct time? Have you informed them of any changes that may be made post transfer? Are there any disputes about whether a particular person should transfer? Are there any benefits that can’t be replicated – and what are you doing about them?

Perhaps it’s the current expectation that everything will happen instantly (although businesses moaned about employment issues long before the advent of on-demand services). Or the assumption that what we don’t understand must be “complicated” (like rocket science, which is one of the simplest concepts there is).

Making a risotto involves stirring stock into rice for around half an hour. You could bung it all in a microwave for 5 minutes but if you did you’d end up with an inedible mess. Complying with employment rules is like making risotto – it’s not difficult but you need time to get the right result.

Be Careful What You Wish For

Posted on by • Posted in HR Thoughts, HR Tips for Business and Charities, Work Related Posts • Tagged , , , , • 3 Comments

One of the big fears for the owners and managers of small businesses is that at some point an employee will take them to an Employment Tribunal. Even if they win the case, the time, cost and stress to the owner is high. And even if the employee’s claim is apparently trivial or patently false, the thought of having your employment practices crawled over by a judge is understandably unpleasant. Matters aren’t helped by tabloid tales of companies being hit for huge compensation awards.

So the introduction of tribunal fees in 2013, which has seen a fall in tribunal claims of between 60-70%, has to be good news for small companies. Now at last businesses can get on with running effectively without fear of a discontented ex-employee making a claim against them.

Except…the pendulum may have swung too far. Most small businesses I encounter (and in my line of work that’s a lot) want to be “good” employers, they want to do things legally and properly and aren’t looking to make life as unpleasant as possible for the staff they employ. If they do something “wrong” it’s usually a genuine mistake rather than a deliberate attempt to defraud their employees.

The problem though is that when individuals can’t enforce their rights, it leaves the door open for the unscrupulous employer to ignore the law, safe in the knowledge that no-one will do anything about it. Honest, law abiding businesses that want to do things correctly are the ones that suffer, as this sad tale from the newspapers this weekend shows. The fact that the business owner is a Tory MP adds a little irony but the key point is that here is a responsible person trying to do the best for his business and employees, but is undercut by those operating at the margins – or even outside – the law.

Think about it this way. If you own a car, you pay your car insurance (no doubt moaning, as I do, about the cost of it). You do because it’s the law to have insurance. Yet if there’s no method of enforcement, why should you bother? Hundreds of thousands are estimated to be driving without insurance, taking the chance that they won’t get caught. And if they are – usually if they are involved in an accident – it’s the honest driver who bears the cost through increased premiums. If the premium becomes unaffordable you either give up your car or you drive uninsured too.

I’m not arguing that tribunal fees should be abolished completely (there’s no reason why the taxpayer should bear all the cost when they don’t in any other area of the law), but that the system needs to be rebalanced – for the benefit of decent employers as well as employees.

When Love Breaks Down

Posted on by • Posted in HR Tips for Business and Charities, Work Related Posts • Tagged , , , , • Leave a comment

Listeners to radio soap The Archers (of which I am one) have been following for the last few weeks the ongoing affair between Elizabeth Pargetter, owner of Lower Loxley, a stately home now used as a Conference venue, and her general manager, Roy Tucker. In true soap opera fashion, Roy’s wife Hayley also works at Lower Loxley, as nanny/childminder to Elizabeth’s children. The affair ended with Elizabeth – much to Roy’s dismay – not only finishing their relationship but suggesting that Roy find another job.

Workplace relationships are an area that can be fraught for any employer, but particularly small ones where key staff can blur the boundaries between the professional and the personal. It’s not that they are uncommon either – it’s estimated that a significant proportion of personal relationships start in work (some even say a majority). Handling the breakdown of a relationship, especially between a “boss” and a “subordinate” can create many problems for a business.

Could Elizabeth sack Roy? Although she was very careful to say initially that she was not doing so, she might well have legitimate grounds for dismissal, under what is known as “some other substantial reason”. By giving Roy a period of paid leave of absence – often known as gardening leave – she’s making it clear that they can no longer work together. However, her subsequent actions of offering Roy’s job to his temporary replacement before finalising matters with him, and failing to follow any sort of process, have given him grounds for a claim of unfair dismissal (leaving aside the issue of whether he could afford to bring a claim). In practice, this is exactly the sort of situation that an employer and employee should try to resolve via a Settlement Agreement – a confidential and legally binding agreement to end an employment relationship – thus avoiding both embarrassing publicity for the business and personal information being made public.

But what about Hayley? Would Elizabeth and she be able to maintain a working relationship, especially as Hayley has now discovered the true reason for Roy’s late nights at the office? Again, Elizabeth might be able to use the “some other substantial reason” argument for dismissing her, but I suspect her case would be much weaker unless Hayley started behaving in an inappropriate manner. Hayley herself has quite understandably stated that she doesn’t really want to work with Elizabeth in the future. Here once again, a settlement agreement might be the logical way forward, unless Hayley resigns in a fit of pique.

Whatever happens – and at the time of writing it remains an unresolved issue – it will be an expensive fling for all concerned. And while The Archers is fiction, the consequences are likely to be the same if something like this happened in your business. It’s a worthwhile reminder of what the “Human” in Human Resources really means.