Employment FAQs
- Is it necessary to give my employees written contracts of employment?
- Do I have to have a separate staff handbook?
- Can I dismiss an employee who has worked for me for less than one year?
- How do I dismiss an employee for poor performance?
- How do I make someone redundant?
- How do I deal with multiple numbers of redundancies?
- How do I avoid discrimination claims?
- Can I prevent my employees from going to work for my competitors after their employment with me terminates?
- Is there any way I can prevent an employee from bringing Employment Tribunal proceedings against me by getting him/her to sign an agreement?
- Do I have to agree to a request to work part-time?
- What is the current National Minimum Wage ?
- What happens to employees on the sale of a business?
- What limits on work are set by the Working Time Regulations?
- When does age discrimination legislation commence and what will it mean?
1. Is it necessary to give my employees written contracts of employment?
Yes it is. If nothing is put in writing, a verbal contract will exist and the terms will be determined by what was agreed, by custom and practice or by implication. Such terms may be incredibly favourable to the employer. The importance of ensuring that employees sign up to date and well written contracts of employment is paramount. Written contracts provide certainty, thus preventing misunderstandings about the terms and subsequent disputes.
There is a legal obligation to provide employees with a written statement of particulars of employment within two months of the start of their employment. An employee can recover increased compensation from an Employment Tribunal if their employer fails to provide a written statement or provides one which is incomplete or inaccurate.
2. Do I have to have a separate staff handbook?
It is extremely important to have policies and procedures separate from the contract of employment so that they do not have contractual effect. This is so that if the employee makes any slight deviation from them (due to exceptional or unusual circumstances), it will not result in a breach of contract claim. Policies and procedures can be stand alone documents but often employers find the best way to keep them together is in a staff handbook.
The benefits of having policies and procedures in place are far-reaching. Not only are they a good tool for establishing and communicating rules to employees, but they can also prevent disputes occurring or alternatively, form a crucial piece of evidence should a claim be brought.
3. What are the benefits of family mediation?
Usually, employees do not accrue protection from unfair dismissal until they have 51 weeks continuous service (as the one week statutory notice period can be added to the length of service to amount to one continuous year). However, there are certain categories of dismissal which can be “automatically unfair” such as a pregnancy-related dismissal and in these situations, an unfair dismissal claim can be brought no matter what length of service the employee has accrued.
Employees with less than one year’s service can also bring breach of contract claims if insufficient notice is given to them. Discrimination claims can also be brought, no matter what the length of service.
Aside from these risks, it is generally safest to dismiss an unsatisfactory employee before they acquire 51 weeks’ service. We recommend as a minimum following the Statutory Dismissal Procedure which involves warning of the risk of dismissal, providing the right to be accompanied by a colleague or trade union representative at a meeting and the right of appeal.
4. How do I dismiss an employee for poor performance?
Performance dismissals are notoriously difficult. Care must be exercised in ensuring that a proper procedure is followed. Initially, an informal process should be followed when targets are set and the employee is given the chance to improve. If the employee fails to improve, then formal warnings must be given and a further opportunity to improve.
If appropriate, guidance and training should be given to the employee to assist improvement. If the employee continuously fails to improve and the formal warning procedure has been exhausted, then you can proceed to dismissal, ensuring that a formal procedure is followed and the right of appeal is provided.
5. How do I make someone redundant?
In order to avoid an unfair dismissal liability, there must be a genuine redundancy situation and a fair procedure must be followed in making the redundancy. This should involve carrying out a consultation process with every employee who holds a similar position. The purpose of the consultation process is to warn of the risk of redundancy and to allow the employees to voice their opinions and objections and put forward alternative suggestions.
The majority of unfair dismissals, on the grounds of redundancy, are found to be unfair because of the inappropriate or unfair application of the selection criteria. It is, therefore, essential that objective criteria, precisely defined and capable of being applied in an independent way, are used. Remember the cost of getting it wrong is currently £58,400 (the unfair dismissal compensatory award)!
In addition, the Statutory Dismissal Procedure must be followed in making any redundancy. This involves an invitation to a meeting with an express warning that the meeting could result in dismissal, providing the right to be accompanied and offering the right of appeal.
6. How do I deal with multiple numbers of redundancies?
With extreme care! In large-scale redundancy situations, there are added and complex obligations for consultation. In addition to an unfair dismissal award, every employee can recover a “protective award” of up to 90 days’ gross pay for failure to consult.
The added obligations apply to employers who propose to dismiss 20 or more employees at one establishment over a period of 90 days or less. The duty is to consult representatives of any recognised independent trade union, or if no trade union is recognised, other elected representatives of the affected employees.
Consultation should begin in good time and be completed before any redundancy notices are issued. As a minimum, consultation must begin :
7. How do I avoid discrimination claims?
There is currently legislation to prevent discrimination on the grounds of sex, race, disability, sexual orientation and religion and belief. In order to avoid discriminating on these grounds, you firstly need a comprehensive and up-to-date equal opportunities policy. The existence of such a policy is usually the best starting point in defending a discrimination claim. However, you must also ensure that the policy is implemented properly and communicated to every member of staff. Secondly, line managers and senior members of staff should be trained in equal opportunities. We can provide this training for you, either at your premises or at ours, tailored to the specific needs of your business.
You also need to keep aware of changes in legislation and prepare for these further changes. For example, in October 2006 legislation to outlaw age discrimination will be implemented in the UK. This legislation will have far-reaching effects. The sooner you start preparing your business for these effects, the less risk of claims for discrimination being made against you when the legislation comes into force.
Be aware that compensation for discrimination claims is potentially unlimited!
8. Can I prevent my employees from going to work for my competitors after their employment with me terminates?
Potentially yes. You would need to ensure that your employees signed restrictive covenants
Provided these restrictions were tailored specifically to your business and the individual employee and provided that the restrictions lasted for only a specified period of time, they could be legally enforceable.
The existence of restrictive covenants can act as a deterrent to employees thinking about working for a competitor. They can also be used to obtain an injunction to physically prevent the former employee from continuing working for a competitor.
Well drafted restrictive covenants are a sound investment to protect your business.
9. Is there any way I can prevent an employee from bringing Employment Tribunal proceedings against me by getting him/her to sign an agreement?
Yes, this can be done even before any proceedings are issued by using a compromise agreement. This is a legally-binding agreement which provides that in return for some consideration the employee gives up all potential employment claims he/she could bring. In order to make the agreement legally-binding, the employee must obtain independent legal advice (for which the employer usually contributes £250).
Compromise agreements are widely used by employers as they are often the cheapest and most amicable way of resolving any potential dispute. They provide certainty and finality for both parties and can be concluded within a matter of days.
10. Do I have to agree to a request to work part-time?
It depends. The parents of young (under 6) and disabled (under 18) children have a right to apply to work flexibly. Such an application places a duty on employers to give serious consideration to such requests and to refuse them only if they have clear business reasons for doing so.
If requests to work flexibly are made for reasons connected to an employee’s disability or religion, care must be exercised in ensuring that such requests are carefully considered. If they are not, or if they are unreasonably refused, the employee could succeed with a discrimination claim. Likewise, when age discrimination legislation comes into force, the refusal of a request to work flexibly could result in a discrimination claim.
11. What is the current National Minimum Wage ?
The adult rate of the minimum wage (for workers aged 22 and over) is currently £5.05 per hour. This is expected to increase to £5.35 in October 2006.
The development rate (for workers aged 18-21 inclusive) is currently £4.25 and is expected to rise to £4.45 in October 2006.
The 16-17 year old rate is at £3.00 an hour.
12. What happens to employees on the sale of a business?
Legislation exists which preserves an employee’s terms and conditions of employment when a business or undertaking, or part of one, is transferred to a new employer.
The legislation means that :
The requirements apply regardless of the size of the transferred undertaking.
Breach of the requirements can result in unfair or constructive dismissal claims, just and equitable “detriment” awards and up to 13 weeks pay for failure to inform and consult.
13. What limits on work are set by the Working Time Regulations?
The Regulations set the following limits:
14. When does age discrimination legislation commence and what will it mean?
Age discrimination is due to come into force in October 2006. It will cover people of all ages, young and old. The legislation means that employers will no longer be able to recruit, train, promote or retire people on the basis of age, unless it can be objectively justified. Compensation recoverable, if discrimination is found to have occurred, will be potentially unlimited.
We strongly recommend a review of your policies, procedures and practices well in advance of the new legislation in order to avoid falling foul of the law when it changes.
