Protecting Your Business | HR Solutions | HR Advice

At a time of uncertainty, you will want to do everything within your means to keep your business running smoothly and to limit risk. As we continue to respond to Covid-19, managing the employment relationship is even more critical to ensure your business can survive and thrive. The biggest cost to any employer is its people and people are essential to a business’s success. Careful and sensitive management of ending as well as maintaining the employment relationship whilst balancing the needs of the business will therefore be key.

The Employment Relationship

Managing the employment relationship can be challenging any time but it is even more so now and sadly, Covid-19 is leading to many difficult conversations and decisions having to be taken.

For many employers, redundancy will unfortunately be inevitable, but even where it can be avoided, for many businesses, the pandemic is forcing them to review its operating structure and restructure itself in order to be able to continue in the ‘new normal’.

There are then decisions needing to be made as to who you bring back off furlough, and who you don’t; and for those returning, you may face protest and have to deal with employees refusing to return. All of which adds to the already existing pressure that exists for many businesses.

Consequently, organisations face many risks associated to managing the employment relationship and whilst this hot topic focuses on where risks can exist with Covid-19, the principles will apply to the employment relationship at any time.

What Claims Can be Pursued?

Employment tribunal claims arise through poor management; most often with dismissals, it is the process that leads to a successful unfair dismissal claim rather than the decision to dismiss itself. There are several ways in which an employee can pursue a claim through the employment tribunal system:

Unfair dismissal

There is a statutory right not to be unfairly dismissed under the Employment Rights Act 1996. The right is generally subject to several qualifying conditions such as the employee must have been dismissed and at the time of the dismissal, they had two years’ service.

There are exceptions where the 2-year qualifying service is not needed. Those in particular which could be relevant now include:

  1. Dismissals in connection for raising health and safety issues
  2. Refusing to work in circumstances of danger
  3. Being or proposing to become an employee representative.

Constructive Dismissal

This is similar to unfair dismissal in that there is a qualifying service required in order to bring a claim; however it is the employee that resigns because of the actions of the employer, and it this resignation that would be seen as a dismissal as opposed to the employer carrying out the dismissal.

Discrimination Claims

The Equality Act 2010 protects employees who hold a protected characteristic from discrimination in the workplace. A protected characteristic includes age, sex, disability, sexual orientation, religion or belief, pregnancy and maternity leave, marriage and civil partnership, race (including colour, nationality, ethnic or national origin) and gender reassignment.

The protection covers employees from being directly discriminated against and treated less favourably to someone else for their protected characteristic. Or where rules or practices are put in place which then disadvantages an employee. It also makes it unlawful to harass or victimise an employee when that treatment is connected to their protected characteristic.

Protected Disclosures

Employees are protected under the Employment Rights Act who make protected disclosures, also known as whistleblowing claims. They are protected from dismissal, selection for redundancy or from being made subject to a detriment.

Managing Redundancies

Unfortunately, redundancy for many will be inevitable at this time. Manging the end of the relationship correctly in line with employment legislation is going to be critical to avoid claims of unfair dismissal, or discrimination.

What is a fair dismissal?

To be able to successfully defend an unfair dismissal, there are two hurdles an employer must get over. The first being that the reason for the dismissal was for one of the recognised fair reasons. So, this could be either conduct, capability, redundancy, statutory restriction (by continuing to employ you would break the law) or some other substantial reason (SOSR, such as employee sent to prison).

The second hurdle, and perhaps the most difficult to defend is whether the dismissal was reasonable. Consideration would be given to whether a proper procedure was followed and if so, was the decision to dismiss within a band of reasonable responses. Only if it were beyond what a reasonable employer would have done, can a tribunal conclude that a dismissal was unfair.

Each dismissal is going to have its own set of circumstances. What is reasonable for one employer, may not be reasonable for another. Reasonableness is not defined in law; it is only for a tribunal to conclude what is.

With redundancy, it is very rare for a tribunal to involve itself in assessing whether the business case for the redundancy was correct and appropriate, however a good solid business can have a significant impact on how employees react to the news as if they can understand and appreciate the reasons they are more likely to support the business. It can also help in defending any case at tribunal in demonstrating the redundancy was a reasonable response to the situation it was in. In the absence of a good business case employees may not be convinced of the genuine reasons for redundancies being considered and are much likely to challenge the process at all stages. They focus on the process that is undertaken in response to the business circumstances.

How to mitigate against risk from an unfair redundancy dismissal?

Here are just some of the ways in which an employer can mitigate the risk from an unfair dismissal claim when handling redundancy dismissals. It would be impossible have one definitive list since each case is going to have its own set of circumstances. The items here are very much process related, however, where you will also need to be reasonable is around the questions and discussions that arise from the consultation process and not just what your response is, but how you reach that response.

  1. Always follow your own redundancy policy; if you do not have one, consider how you have handled redundancies previously especially in terms of pay
  2. Establish the business case.
  3. Write to those affected explaining the business rationale, the anticipated numbers, the pool being drawn (where there has to be a reduction in numbers), the proposed selection criteria, the process you intend to follow along with the timetable
  4. Ensure you comply with the statutory consultation timescales
  5. Where you have less than 20 roles at risk of redundancy there is no set timescale, but you are legally obliged to carry out “meaningful consultation”. To demonstrate you have “meaningfully consulted”:
    a) Have you allowed the employees to contribute and put forward ideas to avoid redundancy and have you given this due consideration?
    b) Have you allowed sufficient time for employees to be able to contribute and have a say on their own personal circumstances before you close consultation and decide?
    c) Have you given serious consideration to finding suitable alternative employment and find ways to avoid redundancy?
  6. Through consultation, explore whether you can seek volunteers
  7. Consider whether there are ways of avoiding redundancies
  8. Consider alternative employment (including suitable alternative, which is a role of comparable terms)
  9. There is an obligation on employers to offer suitable alternative employment to a woman whose job becomes redundant whilst she is on maternity leave. The priority for those on maternity leave is the one area of discrimination law where employees receive additional legal protection
  10. Ensure there is a fair selection process free from discrimination
  11. The decision on who is redundant must only be made once consultation has closed
  12. Allow redundant employees reasonable time off to seek new employment
  13. Explain how notice pay, redundancy pay, and any other payments will be calculated
  14. Keep a paper trail of your search for looking for alternative employment
  15. All meetings should be followed up and confirmed to employees in writing
  16. Where you do have disgruntled employees and there is a risk of a claim; incorporate an appeal process into your procedure (where there is not one set out in your policy), as this gives the employer time and opportunity to address any issues internally rather than waiting for a tribunal claim.

Remember the hurdle you must get over is to demonstrate the dismissal was reasonable by the way the procedure was conducted and that the decision to dismiss was within a band of reasonable responses.

Whether you are managing a conduct process or any other process that has potential for dismissal, always adhere to your own company policy and always explore through the process ways in which alternative ways to avoid a dismissal, or in the case of conduct; would action short of dismissal be reasonable. Dismissal should always be the last course of action.

Managing Furlough

Furlough has saved 9.1 million jobs over the last three months; for some redundancy may be the next course of action, but for many, a return to work is possible for either all their employees or some. Mishandling the process can lead to discrimination claims and/or claims of constructive dismissal.

How to mitigate against risk from a discrimination claim?

When it comes to determining which of your employees are brought back after furlough; remember that if you have employees who hold one of the protected characteristics (age, race, sex etc) then be careful to not act either in a way which inadvertently discriminates against one particular group, or to treat someone less favourably to someone who does not hold a protected characteristic. For example, asking only full-time employees to return. This could indirectly discriminate against women, who are likely to be those employees who are part time.

In the event whereby you only need a selection of your workforce returning consider your approach. You need to be consistent, be able to justify the business reasons for it and have a fair process to determine. Here are some ideas as to how you can approach unfurloughing some of your employees:

  1. Seek volunteers
  2. Use a process that is based on skills and experience
  3. Review health and safety risks; those who are shielding may be best not returning.

Where you do have an employee concerned in how they have been selected (or not); then ideally try and resolve the matter informally first; however should this not resolve the concerns, then it would be recommended that issues are dealt with through the grievance process rather than be ignored.

Returning to a Covid Safe Workplace

Undoubtedly, employees will be nervous at returning to work, and we must remember that there will be heightened anxiety around Covid-19 given the psychological impact being significant. People will have differing views and interpretations on the situation and how it is being managed from a workplace perspective. Your employees may also know of someone who has either had the virus or sadly died. Being empathetic and sympathetic at this time will be invaluable.

However, employers may have to deal with some employees who do not want to return to the workplace through fear. Managing discussions effectively will be crucial in handling an employee’s return.

Getting it wrong can lead to unfair or constructive dismissal claims. Under the Employment Rights Act 1996, employees are protected when acting to protect their own or others’ safety. An employee has the right not to be subjected to any detriment or be unfairly dismissed where the employee reasonably believed the danger to be so serious and imminent and chose to leave or refused work. It is very likely that Covid-19 would be considered as a serious and imminent risk by an employment tribunal.

To be successful in bringing a claim, employees must show that there were circumstances of danger which they reasonably believed to be serious and imminent. It will not matter what the employer thought, what matters is what the employee reasonably believed at the time they acted. Unlike general dismissal claims, an employee who brings a claim relating to health and safety does not need the usual two-year service to bring a claim. Dismissals on health and safety grounds are automatically unfair. Remember, a dismissal could occur either through an employee resigning (constructive dismissal), or where the employee terminates the contract following a disciplinary process (unfair dismissal).

How to mitigate against risk from an unfair or constructive dismissal claim?

Here are just some ways in which an employer can mitigate against risk in the event the employee is refusing to attend work:

  1. The Risk Assessment is priority. Before anybody can return, and full and thorough risk assessment must be carried out.
  2. Communication is key to how your employee perceives any threat of danger. By communicating your findings, the measures you will be adopting, and even seeking their input, you are much likely to gain their agreement and reassurance.
  3. Explore ways concerns can be addressed will be vital. It is about listening to their concerns, understanding why they feel the way they do, and together findings solutions that can alleviate these concerns.
  4. If you believe you can offer a safe working environment, but they still do not feel safe then you could consider finding the middle ground. This middle ground could be to allow a period of time off work, but the time is treated as unpaid. Whilst this will show compromise on both sides, the position on pay is not clear. There is a debate within the legal profession as to whether employees should be paid who refuse to attend work, however there are strong arguments on both sides and so, any decision you make on this would be a commercial one. We do not expect a ruling on this until a case is tested in the courts, which could be 18 months to 2 years away.
  5. A further consideration to deal with time out, is to allow an extended amount of annual leave.
  6. Keep a record of your discussions and evidence of adaptations you are making.
Providing a Safe Place of Work

As workplaces reopen after lockdown many people are worried about their safety and that of their colleagues, clients, or customers. It will be vital therefore to consult, communicate and explain to your staff what measures are in place to keep them safe.

However, where an employer fails to follow government advice or is putting the employee, customers, or clients at risk then that is where there is the potential for a whistleblowing claim. To blow the whistle the employee would be making a protected disclosure under the Employment Rights Act meaning they will be protected from dismissal, selection for redundancy or from being made subject to a detriment.

Whistleblowing is a threat, but not something to be afraid of. The fear is usually about matters being brought to light outside the organisation meaning it is much harder to resolve and can cause serious reputational damage. It is vital therefore that organisations build a culture where employees feel comfortable raising concerns informally.

How to mitigate against risk from a whistleblowing claim?

Here are a few things that you can do:

  1. Empower your employees to speak up
  2. Understand what stops employees from coming forward initially
  3. Offer multiple, confidential reporting channels to you employees
  4. Facilitate a trustworthy open-door approach
  5. Give your employees access to anonymous reporting.

Having a culture that is open and transparent and encourages people to speak up, and of course, every employer must have a grievance policy in place.

Where concerns are being raised, it is often by far the best approach to try and resolve informally, however, recognise that on occasion using a more formal approach like the grievance process may be the only way to address.

In the employment tribunal case Miss C Robinson vs Mind Monmouthshire Ltd, Miss Robinson was found to have been unfairly dismissed for having made a protected disclosure regarding discrimination occurring in the workplace. The case highlights the need to treat issues seriously, even when formal grievances are not immediately raised and that in exceptional circumstances, you do not need a grievance in order to act; action should be a matter of course. With Covid-19, there is potential for health and safety concerns being raised, which could be the basis of a protected disclosure.

HR Support

In a recently recorded webinar HR Solutions discuss how you can protect your business from the risks associated particularly with ending the employment relationship. Watch the webinar recording at your convenience at www.hrsolutions-uk.com/services/protecting-your-business-2/.

For more guidance articles relating to the effects of the coronavirus pandemic visit the HR Solutions’ dedicated page ‘Coronavirus Advice and Guidance for Employers’.

HR Solutions are here to provide you with support and advice on any employment-related issues; to find out more call us on 0844 324 5840 or contact us online.

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