Employment Law for Employers

I need to cut costs. Should I restructure my business? Can I make people redundant? How much will this cost? Where do I start?

Redundancy is a type of dismissal instigated by an employer who needs to reduce the number of people employed or alternatively close the business.

Redundancies take place for many reasons e.g. businesses need to evolve because of the introduction of electronics or changes in customer demands which may cause the workplace to need fewer people.  It is important to understand that it is not the person who is being made redundant – it is the role that that person was performing which is not needed any more. The procedure to effect a lawful redundancy is complex – the employer will need to consider the size of the business, the number of roles that need to disappear, are there any other roles that those people could do, termination date, ages and lengths of service of those employees, their wages, bonus or commission payable etc. The employer must also exercise caution over employees whose employment is governed by the Equality Act 2010 i.e. those “protected” and who may file a claim of discrimination against the business.

An employer must be sensitive when conducting a redundancy exercise – this process is bound to be difficult and traumatic for the employees, many who are diligent performers and have been there for years.

When someone is being made redundant there are strict processes that must be followed, including consultation, notice periods and redundancy pay.

We will work alongside you to help ensure that your redundancy operation is executed in a timely manner with compassion and in accordance with legal requirements.

My employee is not performing – what can I do?

It is important to remember that performance is different to misconduct; so the process you need to follow is slightly different. Underperforming employees must be given a chance to improve – they must know that you are unhappy with their performance, so raise it with them formally.  Set goals that are realistic and fair, have regular meetings with them to discuss progress, and provide them with training where appropriate.  Maybe consider “buddying” them up with a star performer for a while so that they learn from that stellar achiever.  Make sure that they are crystal clear that you expect them to improve or else they will be dismissed for capability.  Make sure that they know that you are doing everything reasonable to help them improve, but if at the end of the PMP (Performance Management Program) they have not improved sufficiently, they will not be kept on.  Then, if you dismiss them, you are likely to have a reasonably robust defence to any tribunal claim.

We will work alongside you to help develop a fair PMP. This will ensure that your employees know that you will help them perform the best they can and if they are still underperforming after a PMP, they will be either moved to a more suitable role or out of the business.

ACAS have contacted me.  An employee (or ex-employee) is bringing a claim.  What do I do?

If an employee (or ex-employee) wants to claim at tribunal, they must lodge an ACAS Early Conciliation application online. This forewarns the employer that there might be an employment tribunal (ET) claim coming their way.  Both employer and employee should try to settle the matter before costs start mounting up, and both will benefit by using the services of the independent ACAS conciliator assigned to liaise between the parties.

We will assist you in attempts to negotiate an agreement via ACAS.

You have a specific time scale – normally about 30 days to file your defence. If you miss this deadline you will have to seek consent of the tribunal for an extension of time.  You will have to explain why you failed to respond within the time limit.  There is no guarantee that you will get the extension meaning that judgment could be given straightaway for the employee without your input.  This process is stressful.

We will assist by analysing the facts and legal issues of the case swiftly.  We will advise you on the merits of the claim.  We will then either file a defence on your behalf or negotiate a settlement to resolve the matter.  If the case proceeds to trial, we will handle this for you.  This will involve preparing the evidence and witness statements and representing you at the tribunal hearings.

Remember one word: urgency.  To protect both yourself and the employee, act promptly.  Investigate and revert to the employee.  Then allow them to appeal your outcome.  And then do the same for the appeal: investigate and give them an outcome.  Watch for grievances that may not be raised formally but are brought to your attention anyhow.  You have a duty to treat them the same as formal grievances.

It can be daunting and exasperating to receive a grievance as these require the business to dedicate resource to the matter which most businesses can least afford, as they are busy focusing on customers, but it is imperative that you deal with grievances quickly and fairly.

There can be times that grievances arise between employers and their employees.  It is important that they are treated quickly and fairly and in accordance with the procedure as laid out in the Employment Rights Act 1996.  A guide to dealing with grievances (and disciplinaries) can be found in the ACAS Code of Practice: Disciplinary and Grievance Procedures. This is the minimum guide that all employers must follow.

We will come alongside you and assist with every step.  We will provide practical guidance which will tick the legal boxes to minimise the risks for you.

The Employment Rights Act 1996 requires that terms of employment must be provided to employees in writing within two months of starting work. A contract also provides clarity for both parties.

We will draw up contracts of employment for you which comply with legal obligations and will also include specific terms to suit your particular business.

How do I protect my business from ex-employees?

To protect your customer base and your confidential information, you must include restrictions in your employees’ contracts of employment. These restrictions will govern their behaviour during their employment with you and after they leave. In order to be enforceable such restrictions must be reasonable. To determine what is reasonable a number of factors need to be considered – what exactly are you protecting, how much damage could be done by that employee, how senior are they, how much access do they have to sensitive resources etc.  Remember also that as an employee is promoted within your business, this clause needs to be reviewed and tightened.

We will work alongside you to prepare restrictive covenants which will be deemed enforceable if and when the time comes. We will also assist in enforcing such restrictions.

Do I need an employee (or staff) handbook?  

It is not a legal requirement to have an employee handbook but you will benefit from having all your policies and procedures in one place. You may choose to have it online on a central server or intranet, or you may have a hard copy in the staffroom or central office. An employee handbook must be non-contractual so that you retain the flexibility to update the contents as the business evolves.

What policies and procedures do I need? What should I put in my staff hand book?

There are some policies you must have – Grievance and Disciplinary policy, and if you have more than 5 employees a Health and Safety policy. There are other policies and procedures which are “best practice” – Capability or Performance Management procedure, Anti-Bullying and Harassment policy, Sickness Absence policy, Holiday policy, Social Media policy and an IT & Communications policy. You may find that there are policies and procedures that your suppliers/customers insist that you adopt such as Anti-Bribery policy and Modern Slavery Act policy.

 We will work alongside you to tailor a handbook to enable your business to project a professional approach to the work environment.

How can I reward my good employees?

Employees who contribute to the success of your business can be rewarded via bonuses, commissions, promotions, benefits, and being offered part of the business through employee share schemes.

We will come alongside you to work out the most attractive reward schemes for your business.

All employees have a legal right to take a reasonable amount of unpaid time off work to deal with situations affecting their dependants.  This is commonly called “Time off for Dependants” or “Emergency Family Leave”.  This enables people to strike a better balance between their work and family commitments. Employees must not be penalised as long as their reasons are genuine.

My employee is pregnant what do I do?

As an employer it can difficult to navigate your legal obligations towards pregnant employees.  On top of this, they have additional rights when they start maternity leave. There are rules also for people adopting.  Then there is paternity leave to consider and shared parental leave also.

We will work to help you provide your employees with their entitlements and minimise the risk of successful claims that may arise.

My employee wants to work part time – can I refuse? What is a Flexible Working Request?

Employees with 26 weeks’ continuous service have the right to make one formal Flexible Working Request (“FWR”) every 12 months. You can refuse, but there are formal procedures that you must follow first, and you must know that there are only 8 specific grounds on which you can refuse. Note that agreeing to a FWR may benefit your business. You can also try to reach a middle ground that works for both you and your employee if their FWR as sent to you does not appear to be “workable”.

We will help you comply with the legal formalities and find that middle ground if need be.

My employee is having a lot of time off to look after their poorly child – do I have to pay them for this time off?

Employees with children or other dependants such as an elderly parent who rely on them do have various legal rights to take time off.  Some of this time is paid, some is unpaid. Parents have the right to 18 weeks unpaid parental leave per child until the child is 18. Carers have the right to reasonable unpaid time off to sort out emergency care arrangements. For doctors or dental appointments you have the right to require employees to book that time off as holiday.  Be sure to treat all your staff equally.

We will advise on the various complexities and entitlements so you can assist your employees to time off when they need it, whilst avoiding disruptions to your business.

As employees have a statutory right to both paid and unpaid parental leave, you would benefit from implementing a policy which explains this to them.  You might also consider incorporating other ‘family-friendly’ measures such as emergency time off to care for dependents and the right to request flexible hours. These family-friendly benefits are detailed in different legislations such as the Employment Rights Act 1996, the Employment Relations Act 1999, the Employment Act 2002, and the Work & Families Act 2006.

I have two employees who don’t get on what can I do?

This is not always as simple as telling your employees to “get on with each other”.  Sorting these squabbles and disputes can take up a lot of management time. You must investigate, determine who is right and who is wrong, consider whether you need to discipline one or the other, perhaps appoint a mediator, monitor the relationship going forward etc.

We will help guide you through this maze to enable all parties to move forward and rebuild working relationships, and in the process contribute to the success of your business.

My employee wants to leave – they asked for a settlement agreement.  What is this?

A settlement agreement is a contract negotiated between the employer and the employee (or ex-employee).  This provides closure on some grievance or exit of an employee from the company. A completed settlement agreement means that the employee has agreed not to proceed to tribunal on whatever the issue is/was.  The parties agree certain terms and conditions, and frequently the employer pays the employee a sum of money to close the matter.  Both parties agree to keep confidential the terms of the agreement.  An independent legal advisor must countersign the agreement after having advised the employee, otherwise the agreement is unenforceable. The employer must contribute a reasonable sum towards the legal advisor’s fees.  This mode of closure is adopted frequently between unhappy parties in the workplace when they realise that the best way forward is to part company.

Am I responsible for my agency workers?

Agency workers have a unique place in businesses – they are not employees but they have certain protections and rights which you can be held responsible for.

We can help you navigate this area of employment law to get the best out of your agency workers and avoid unnecessary liability.

Is my self-employed contractor really an employee?

There are three different types of engagement – employer/employee, employer/worker and client/contractor. Each type attracts different rights and responsibilities. Various factors are taken into account in determining employment status – level of control, provision of equipment, is it imperative that the service is provided by a named specific person, does it matter who turns up at the workplace to do the work, do they work solely for your business or do they have other clients, are they paid via PAYE or do they invoice you, do they have the same sum paid each week/month or do the invoices vary depending on the number of hours worked, must they wear your business’ uniform etc. Be careful with this topic as the legislation relating to IR35 places an onus on businesses to treat almost everyone as an employee or worker for income tax purposes.

We will help you navigate this complex area of employment law to ensure that you have the correct engagements in place supported by the correct paperwork to help avoid complex problems and liabilities with HMRC and potential tribunal claims.

Employment law covers several aspects of the relationship between an employer and their employees and workers. Some of the topics are mentioned below:

Discrimination based on Race, Religion, Sexuality, or Gender

The Equality Act 2010 states that it is unlawful to discriminate against people in the workplace on the grounds of race; religion or belief; age; disability; gender reassignment; marriage & civil partnership; pregnancy & maternity; sex; and sexual orientation.  These groups of people are “protected”.

In particular note that there is a duty to make reasonable adjustments for employees who fall within the “disability” bracket. Refer these employees to Occupational Health (“OH”) specialists so that you have recommendations which you can consider to help them in the workplace.  This will reduce liability to your business.  Remember that you are only obliged to implement adjustments which are “reasonable”.  Be on the lookout with regard to employees who clearly might be struggling but are frighten to seek help such as those going through the menopause.  This group will be worried that you will get rid of them if you find out about their illness.  Work with them to accommodate their plight and consider offering shorter working days or later starts, introduce fans in the workplace, frequent breaks, less onerous work.  Think about adjusted duties for them – they are likely to appreciate your consideration.

Equal Pay

Equal Pay usually refers to the Gender Pay Gap (“GPG”).  In essence if one person is doing the same job as another, they should expect to be paid the same amount of money.  The Equality Act 2010 currently regulates this topic.

Minimum Wage

The National Minimum Wage (“NMW”) is a guaranteed minimum rate of pay that employees must be paid. The amount varies for different age groups and is updated annually by the government. Every employee or apprentice aged 23 and over is entitled to be paid the NMW.  Complaints relating to non-payment of NMW should be made to HMRC or via a claim to the Employment Tribunal.

Working Hours

The Working Time Regulations (“WTR”) 1998 details the time and rest periods for employees. It provides clarity on annual leave, breaks, parental leave, attending jury service and trade union duties etc.

Our costs for bringing or defending claims for Unfair or Constructive Dismissal

Simple Case

Estimated costs:  £5,000 – £8,000

VAT  £1,000 – £1,600

Total  £6,000 – £9,600

Medium Complexity Case

Estimated costs  £8,000 – £15,000

VAT  £1,600 – £3,000

Total: £9,600 – £18,000

High Complexity Case

Estimated Costs  £15,000 – £50,000

VAT  £3,000 – £10,000

Total  £18,000 – £60,000

Factors that contribute to a case becoming complex:

• Amending claims or having to provide further information about an existing claim (“further and better particulars”)
• Defending claims that are brought by litigants in person
• Making or defending a costs application
• Complex preliminary issues such as disputing disability
• Large number of witnesses and copious quantity of documents
• Allegations of discrimination which are linked to the dismissal

There will be an additional charge for attending a Preliminary Tribunal Hearing of £250 (plus VAT) per hour.

Counsel would represent you at a Final Tribunal Hearing. Counsel’s fees are estimated at between £1000 to £5000 (plus VAT) per day depending on the experience of the advocate for attending a tribunal hearing (including preparation).

Generally, we would allow 1 – 10 days for a final tribunal hearing depending on the complexity of your case.

There will also be an additional charge of £250 per hour (plus VAT) if we are required to attend at the final hearing with counsel as we would usually not attend.

Disbursements are costs related to your matter that are payable to third parties, such as court fees. We handle the payment of the disbursements on your behalf to ensure a smoother process.

Key Stages

The fees set out above cover all of the work in relation to the following key stages of a claim:

• Taking your initial instructions, reviewing the papers, and advising on merits and likely compensation.  This stage will be revisited throughout the course as advice may change as the case progresses.
• Engaging in conciliation to explore options of settlement.
• Preparing and filing claim or response.
• Reviewing and advising on the other party’s documentation filed.
• Exploring and negotiating settlement throughout the process.
• Preparing and filing a Schedule of Loss.
• Preparing for (and attending) a Preliminary Hearing.
• Engaging in disclosure and agreeing bundle of documents.
• Preparing and exchanging witness statements.
• Reviewing and advising on the merits of the other side’s evidence and witness statements.
• Preparing bundle of documents, list of issues, chronology, cast list.
• Instructing counsel.
• Preparing your witnesses for final hearing.

If some of the stages above are not required, the costs are likely to be reduced.  Additionally, you may wish to handle at least some aspects of the claim yourself – with us in the background.  We can arrange this to accommodate your individual needs.

The time that it takes from your initial instructions to the final resolution depends largely on the individual case and the parties involved.  If a settlement is reached before a claim is lodged (i.e. during the ACAS conciliation period), your case is likely to take 4 – 12 weeks. If your case proceeds to a full and final hearing, it is likely to take 26 – 52 weeks depending on when the tribunal can list the case for a full hearing.  As the case develops and we have more information, we will be better advised to update you.