Unfair Dismissal (3)
December 29, 2008
This is the third and final post in a series on unfair dismissal. So far I have covered employees’ eligibility to claim, what dismissal is, and the fair reasons for dismissal. This post looks at the way the employer acted in dismissing the employee.
4. Has the employer acted reasonably?
After the dismissal has been found to be for one of the fair reasons, the tribunal will look at how reasonably, or fairly the employer has acted in dismissing the employee. This assessment takes into account the size and administrative resources of the company, and also the process followed. The courts take into account the ACAS Code of Practice on dismissals, even though the Code is not actually part of the legislation, so this is a good place to start when carrying out a dismissal. The Code is based on the Statutory Dispute Resolution Regulations 2004, and as it stands currently, an employer that has not followed the basic statutory procedure will be found to have automatically unfairly dismissed the employee. The basic procedure follows three steps:
Step 1: Statement
The employer should write to the employee notifying them of the issues and invite them to a meeting (with adequate notice) to discuss.
The Employment Relations Act (ERA) 1999 gives employees the right to be accompanied by a Trade Union Official or colleague at dismissal hearings, and the employer should notify the employee of this right in the written invitation.
Step 2: The meeting
The employee must be given the opportunity to state his/her case, which needs to be considered prior to the decision to dismiss or not.
Step 3: The appeal
Employees have a right to appeal against a dismissal, and the employer must notify the employee of this right when giving the decision to dismiss. If the employee appeals, the employer must invite the employee to attend a further meeting (at which the employee has a right to be accompanied), then must inform him/her of the final decision.
In April 2009 the Statutory Dispute Resolution Regulations will be repealed, and a new ACAS Code of Conduct will be introduced. Employers will need to review and change their procedures, and people that are involved in dispute resolution procedures (disciplinaries, dismissals and grievances) should be re-trained on the correct process to follow.
Dismissal is a complicated and lengthy process. The information in the last few blog posts gives you an overview of the considerations an employment tribunal would make when dealing with an unfair dismissal claim, but unless you’re extremely experienced, it is advisable to seek legal advice before acting in any potential dismissal situation.
Unfair Dismissal (2)
December 28, 2008
Yesterday’s post introduced the concept of unfair dismissal, and the first factor to consider, which is whether the employee qualifies to claim. The next two factors to consider are has a dismissal actually taken place, and what is the reason for the dismissal?
2. Has a dismissal taken place?
You’d think this was fairly obvious, but not always. There have been cases where an employer claims that the employee has resigned, and the employee claims they have been dismissed. The onus of proof is on the employee in this dispute. In certain extreme circumstances, a radical variation of the employment contract could actually be classed as a dismissal. There is also constructive dismissal – this is where an employee leaves the company because they are forced to do so because of the conduct of the employer. The conduct needs to be quite serious to entitle the employee to leave and claim constructive dismissal. Lots of things might lead to a constructive dismissal, for example asking an employee to do something inappropriate (e.g. discriminatory) or a breach of contract.
3. What is the reason for dismissal?
Whether a dismissal is fair basically relates to two things: what the reason was for the dismissal, and how the dismissal was carried out.
There are lots of automatically unfair reasons for dismissal, including for carrying out the duties of a health and safety representative, participation in protected industrial action, the assertion of a statutory right (e.g. the right to be accompanied at a disciplinary or grievance hearing), and many more.
The possible fair reasons for dismissal are:
Capability or qualifications: this could relate to the employee’s skills, academic achievements or health.
Conduct: this is the behaviour of the employee at work
Redundancy: the legal definition of a redundancy is where there is a reduction or cessation of work, or a cessation of business (like many of the companies that have gone into administration recently) or a cessation of business at a particular site.
Retirement: this is closely linked to the age discrimination legislation, and a key decision on the fairness of an automatic retirement age is soon to be made by the European Court of Justice.
Contravention of a statutory duty: this means that the employer is not legally able to employ the employee, for example a person who has not been granted leave to enter or stay in the UK.
Some other substantial reason: this reason allows the courts to accept a dismissal that appears not to fall into the other categories, but that they deem to be reasonable.
The next post will look at the way the employer has carried out the dismissal.
Unfair Dismissal (1)
December 27, 2008
Employment law can be a challenging subject for employers to deal with, and one very important piece of legislation to get your head around is unfair dismissal. Handling dismissals wrongly can lead to substantial losses for companies in employment tribunal claims, as well as having a negative effect on the company’s reputation as an employer, since employment tribunal details are publicly available. I always think about how bad it would be to have a case your company was involved in published in the press, or even in an employment law text book!
Employees have the right not to be unfairly dismissed by their employer. This law is part of the Employment Rights Act 1996. A number of factors apply to whether a dismissal is unfair, and the following few posts will look at these factors.
1. Does the employee qualify to claim?
Only employees have the right to claim unfair dismissal, i.e. those who work under a contract of employment. This in theory means that self employed contractors and other seemingly non-employed workers will not be eligible for the right not to be unfairly dismissed. However care should be taken with this assumption, as there have been many cases of people working for a company without an employment contract successfully claiming employee status and then going on to claim unfair dismissal.
Only employees with one year or more continuous service qualify to claim unfair dismissal. This is why many employers dismiss employees in their first year of service without following the statutory dispute resolution procedures. However care should be taken with this as sometimes contracts of employment include the disciplinary and dismissal procedures, thereby making them contractual. This means that an employee who was dismissed in their first year might not be able to claim unfair dismissal but could try to claim for breach of contract. Another consideration with this is whether there are any potential discrimination issues with the dismissal, as there is no continuous service requirement for a discrimination claim. Something else to watch out for is if the employee is nearing their one year anniversary with the company and has a notice period. The date of termination will be the final day of service even if the employee is paid in lieu of notice, not the day they are dismissed. Obviously if they are dismissed for gross misconduct then this isn’t an issue.
The next post will look at whether a dismissal has actually taken place, and whether the dismissal is fair.
What do you do with client gifts?
December 23, 2008
This time of year always poses a bit of a problem for HR professionals when some employees are sent gifts from clients or suppliers, but others are not. Whilst it isn’t ideal to become the Christmas Scrooge and nobody wants to deny staff from being thanked by their clients, receiving gifts from clients does pose ethical questions about the potential purpose of the gift or the future repercussions of having accepted something from a client.
One of the main reasons that gifts should not be accepted by individual employees is that it tends to be the client-facing employees that are sent the gifts, e.g. the sales or account management teams. However normally there are many different ‘behind the scenes’ employees that contribute to the products or services provided for customers, and it isn’t really fair for just a few members of staff to benefit.
Many companies include a section in their policies and procedures on employees accepting gifts from clients, stating that gifts of money should never be accepted, and that gifts such as promotional clothing, wine or food will become the property of the company and should be handed in. This is what I am doing in my company; we have collected all the gifts sent in and will be carrying out a raffle later today to fairly hand out the copious bottles of wine that have been sent. I think this is the fairest way to manage the issue of client gifts.
Unemployment statistics show bleak state of the economy
December 17, 2008
The Office for National Statistics has released new figures which show that in the three months to October this year, unemployment rose by 137,000 people. The total figure of 1.86million is the highest level of unemployment for 11 years. As the recession has hit many industries, the number of people claiming jobseekers allowance has steadily increased month on month for the last ten months. The rapidly increasing numbers of people out of work is said to be worrying financial experts, because the unemployment figure is normally a ‘lagging indicator’ in a recession as it takes a while for the effects of a downturn to make an impact on employment. However the fact that the effect seems to have been immediate causes concern for many people, as described by en economist at Deutsche Bank who said “to see so many job losses this early in the cycle is extremely worrying”.
I have noticed changes within my work as a result of the increasing numbers of people losing their employment. In my organisation we are fortunate enough to still be recruiting where others are having to make many redundancies, and in recent months the number of candidates we are gaining from online advertising on sites such as the job centre website has increased massively, when earlier in the year we were much more reliant on recruitment consultancies to find suitable candidates for our roles. Even for quite specialised roles we are seeing an increase in direct applications as there are so many more people competing for fewer jobs. Whilst this may be a good result for companies’ recruitment budgets, it shows a very sad state for the country and the millions of people now struggling to find work. And it seems that younger workers are suffering more than most, as according to The Prince’s Trust, two fifths of people who became unemployed in the last three months were under 25 years old.
The Government is looking to implement a training scheme for unemployed people, allocating £158million in funding to help people who have lost their job to re-train and hopefully find alternative career and employment options.
Happy parents make happy employees
December 15, 2008
Some family friendly processes have become part of general employment law and practice, such as parental rights to request flexible working and parental leave. Others are more ad hoc and individual companies implement a variety of ways of engaging employees that have family or parental commitments. It makes business sense to look at the different backgrounds, interests and outside commitments of both current and potential employees. Firstly, the more narrow the description of an ideal employee becomes, the more narrow the pool of potential candidates becomes as well, and you may find yourself competing in ever decreasing circles for the employees who seemingly have the right credentials and outside commitments (or lack of them) but may not have the best set of skills and experience for the job you are recruiting for. Having a diverse workforce, with employees from different backgrounds, age, family commitments etc brings with it a diverse range of previous experience that can add real value to the business.
An inexpensive scheme for parent employees is the childcare voucher scheme, which I wrote about a few months ago (‘help staff benefit from cheaper childcare’, April 17, 2008). This basically works through salary sacrifice whereby the cost of vouchers is deducted from an employee’s salary before tax and NI deductions are made, therefore the tax and NI paid on the remaining amount is reduced. Normally the cost to administer the scheme is offset by the NI savings that the employer makes on the reduced gross salary payment to the employee, so this is what makes it a winning scheme all round.
The childcare vouchers option has become very popular in recent years, but the affordability looks set to be challenged in the future following a High Court ruling that led to the benefit entitlements for women on maternity leave being changed on 5th October this year (‘New maternity rights from 5th October’, September 23, 2008). Now that women on maternity leave will be entitled to retain the same benefits throughout their leave, employers may end up having to pay for vouchers the employee may already be taking through the scheme, even though the vouchers are based on salary sacrifice and the employee will be entitled to less or no salary due to maternity leave. This issue is causing many employers to rethink the scheme if they already have it, or may cancel plans to introduce it in the future.
Some companies think quite creatively about what sort of incentives or benefits they offer to employees who are parents, from crèche facilities on site to annual events involving all employees and their families. Someone I know works at a large retailer, and employees who are parents in that company are given filled party bags for each of their children at Christmas each year, which I think is a great idea.
What does your company do for employees who are parents? Do you think you work for a family friendly employer? What do you think of the risk to the childcare voucher scheme following the changes to benefits on maternity leave? If you have any thoughts on this or any other article on the site, leave a comment.
The end of a 99 year era for Woolworths
December 11, 2008
Today brings the sad news that all 815 Woolworths stores across the country will start closing down sales this morning. The famous retail chain went into administration at the end of November with debts of £385million, and Deloitte, the administrator has been trying to find a buyer, but with nobody having come forward, the closing down sale starts today to try to pay back some of the debt. Many stores already have 50% off sales, but this looks set to drop even further, and flocks of bargain hunters are expected to descend on stores looking for cheap Christmas presents such as CDs, DVDs and children’s toys.
This is very sad news for 30,000 employees who are now worried about the likely loss of their employment at the worst possible time. Consultation on redundancy is due to start with all staff, some of which have very long service with the company. It is hoped that if some of the store sites are bought by other retailers such as Sainsbury’s and Asda, then some of the staff will be offered employment at the new store.
According to reports, this is the most striking indication of the devastating effect of the credit crunch so far.
Research shows positive attitudes towards new pensions plans
December 10, 2008
Back in February I wrote about the pensions reforms due to be implemented in 2012. The new ‘personal accounts’ scheme will automatically enrol workers over the age of 22 and earning at least £5000 into a personal pension account, unless they are part of a qualifying employer pension scheme. People will be able to opt out, but it is hoped that the automatic enrolment will encourage people to continue to save for their retirement. There will be a minimum contribution of 4% of the worker’s salary, and the employer will have to contribute a minimum of 3%, with a further 1% paid in by the Government as tax relief.
Today the Department for Work and Pensions is publishing research that has revealed strong backing for the pensions reforms. 70% of respondents that will be eligible for automatic enrolment thought that they will save for their retirement with the scheme when it is introduced. The research found that people are well aware of how important it is to be in a pension scheme, and look forward to being able to benefit from the new scheme.
Welfare reforms look set to change benefit entitlements
December 9, 2008
This week a white paper is to be published on the proposed shake up of the welfare state, and if the proposals are implemented it will mean that many more people who claim benefits will have to prove they are looking for work or attending training in order to continue receiving their benefit payments.
The plans include medical testing for people claiming incapacity benefit, housing benefit reforms that will look at jobseekers allowance claimants’ living circumstances, and ‘work-fare’ schemes which force people to work in return for their benefits if they refuse to take a job.
Benefit entitlements will be split into three groups. The first group will be jobseekers allowance claimants, and from 2010 will also include single mothers whose youngest child is 7 or over. At the moment this group is entitled to income support until the child is 16. Lone parents of children between the age of 1 and 6 will make up the second group, as well as those claiming incapacity benefit. This group will be interviewed at the job centre for eligibility for work. The final group will be mainly people with a serious disability or mothers of very young babies. The new rules would also allow for benefits to be cut if claimants failed to turn up to interviews with the job centre.
Of course, there has been a lot of negative feedback on the proposals, from campaign groups, opposition politicians and rebel labour backbenchers. It is felt by many that the changes would cause big problems with the rising unemployment levels, and there are worries that the rules would be unfair on lone parents due to the lack of affordable childcare.
What do you think of these proposals?
Communication: the life blood of teamwork?
December 5, 2008
I was watching the news the other day and a really interesting story caught my eye. This was the story of David Nott, who was working as a surgeon in Congo for Medicins sans Frontieres, the international medical aid agency. The country has been war ravaged and Dr Nott was working at a hospital in Rutshuru when a 16 year old boy was brought in with a severely infected arm after it had been blown off in a gun fight and amputated by a doctor. The infection was so bad that Dr Nott knew the boy didn’t have long to live; the only option for his survival was a complicated operation to amputate the shoulder blade and collar bone as well as the arm.
Dr Nott had never carried out this operation before, and it would normally only be carried out in a well-equipped theatre with a lot of planning beforehand. But with the other option being certain death for the teenager, the surgeon decided to text a colleague in London whom he knew had carried out the operation before. Instructions were sent back over two text messages, and Dr Nott followed them to the letter. The boy survived the operation and has made a full recovery.
This is the type of story you rarely see in the media – a positive ending to a horrible event, and it was really inspiring to hear about someone thinking on their feet in a crisis situation and using really good communication with a colleague, across the world no less!