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Contracting for success! The secret to flexibility for your business.

Employment Law & HR
BG Purple

Note: this article was first written by our colleagues at Solve HR, before Solve HR joined Law At Work in March 2020. We have imported this...

Recently a colleague and I have been working with a client on managing culture and communication change within their organisation. At our third meeting the Managing Director handed us over files and folders of employment contracts, handbooks and employee information and the instruction to 'redo' them all. For almost 20 years the Managing Director had taken responsibility for issuing the contracts of employment and updating the handbook. All things considered, namely this is not his area of speciality and the time involved in doing so, he had done a fairly good job. The documents were coherent, well presented and had most of the legal terms and conditions required, however what the documents were missing was the real ability to protect and enhance his business. Ironically, the most common area of weakness is the disciplinary procedure which is the one area that when something goes wrong businesses wish to rely on the most. A robust disciplinary procedure, should have 'general principles' which state the key process points which will govern any disciplinary procedure, in particularly clarifying 'investigation methods', 'use of suspension' and 'confidentiality' points to name but a few. The process for dealing with misconduct should then be spelt out in detail and it should be clear! This can often be confusing for owners, managers and even HR professionals alike and tie everyone up in knots, worse still you can lose a tribunal case. I refer in particular to the use of the term 'verbal warning', which is often a 'written warning' according to the disciplinary procedure. How on earth did that term enter the English language and worse still end up in business procedures! A 'verbal written warning' then gets confused. Often we hear a manager say, I have given 'him/her' a verbal warning'. To which we reply, 'oh ok, so according to your policy you invited him to a meeting, following an investigation, giving them 48 hours advance notice and the right to be accompanied, held the meeting, and subsequently issued a verbal warning, followed up in writing and then gave them the right to appeal? .' 'Eh no, I just said that he was getting a warning''.. Oh! I recommend that you have an 'informal counselling' stage which is where the manager can have that verbal conversation about minor misconduct and/or underperformance performance and let the employee know that their behaviour has been noted and improvement is sought or a formal process will ensue. This is a crucial stage and Solve. has developed a particularly easy methodology that our clients use to support this informal conversation with the employee and create a paper trail to back it up. For the formal stages, which would follow if no improvement was made, make sure you have lists of 'unsatisfactory conduct, serious and gross misconduct' which reflect your unique business requirements and industry. In addition, give yourself some flexibility, have an 'action short of dismissal clause' in the event that you have an employee you don't want to dismiss. This could allow you to demote or suspend on no pay as an alternative. Furthermore, the 'short service dismissal clause is a must' with the government extending unfair dismissal legislation to two years. You should also consider the merits of a 'capability procedure' for poor performance and/or managing sickness issues. Tribunals, employees and you too may prefer this procedure and policy for managing issues where there has not been misconduct committed on the employees' part, more of a general inability to perform at a satisfactory level. Another couple of points to consider when drafting your contracts; A 'client dismissal clause'. If you are a service business is it likely that a client may require you to remove an individual from site. What happens then if you have no suitable alternative roles for that employee to carry out? In a similar vein do some of your jobs require your employees to drive? What happens if they lose their driving licence? Do you screen incoming calls or have CCTV, would you ever consider using evidence from these in a disciplinary hearing? If so you must have a clause disclosing this to your employees. What about inclement weather? Do you have agonising conversations about who should be unpaid, made to take holidays etc when the snow comes and inevitably employees call in unable to get into work? Having a policy on this in your handbook covers these eventualities and can be given as guidance and referred to in the event it does happen. What about deterrents such as 'deductions of pay' for negligence or non- competing clauses? In the modern world, you absolutely need a robust IT, Communications and Social Media clause to prevent against any damaging employee activity online. Regardless of all of these, 'great to haves', the law is quite specific on what a contract of employment must specify as a minimum requirement. It still amazes us, as advisors, on how many businesses we come across where the employees still have not been issued with a contract of employment, or the contract is missing fundamental terms and conditions. For reference, an organisation has eight weeks from any employee starting to issue a contract of employment. In most cases without a written Contract of Employment an Employment Tribunal will rule against a business. A contract of employment should have the following; Name of Company and Employee Job Title Start Date, any reference to TUPE and any anticipated End Date Rate of Pay and the pay timescales, method and pay dates Hours of work Holiday entitlement and terms Sickness entitlement and terms Notice Periods Place of work If the position is subject to any collective agreements Disciplinary procedures Grievance procedures Appeal procedures Pension arrangements To ensure your Contracts of Employment support your business objectives call us on 0141 271 5555

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