19/03/2014

By James Townsend, Partner, Employment, at B P Collins LLP

It’s a familiar scenario – a CFO asks his CEO: “What if we invest in all these staff, and then they leave?” The CEO replies: “What if we don’t, and then they stay?” And therein lies the nub of employee engagement. How can employers maintain the balance of investing sufficiently in people to ensure the workplace environment inspires growth, whilst mitigating the inherent risks of investing in human capital?

It’s a fact of life: for one reason or another, staff leave. The challenge is to ensure that whilst they’re with you, they remain motivated and productive – and that when they exit, their departure is well managed and doesn’t unsettle business continuity and profitability. From beginning to end, employees’ tenures will be underpinned by policies and guidelines to support their development, but despite the legal small-print, the whole process is a journey not a destination.

The employment environment is dynamic. In an evolving socio-economic climate, where attitudes, regulation and technologies shift at an alarming pace – and the impact reverberates throughout the workplace – nothing ever stands still.

The journey
The employee journey is paved with familiar landmarks and unexpected diversions. It begins with initial engagement around employment contracts, conditions and bonuses, but can subsequently veer into grievances, disciplinary and contractual disputes at a later stage. Journey’s end can encompass aspects such as dismissal, tribunal claims, enforcing/defending injunctions and even post-termination restrictions.

With potential pitfalls throughout the entire employee life cycle, frequent and proactive engagement with a legal partner can help companies mitigate risk and protect their business from the commercial and reputational damage of litigation.

By establishing an open relationship with a trusted legal partner, businesses can share their long-term goals and ongoing challenges – allowing the legal team to tailor advice and policies that align with identified business needs. This process typically begins with the development of a wide-ranging Employment Handbook, which sets out all of the mandatory terms and conditions of a contract of employment, as well as individual company guidance around aspects such as smoking, company car or flexible working policies. Companies are, by law, required to publish policies around equal opportunities, whistleblowing, health and safety, grievance and disciplinary matters.

A robust Employment Handbook is designed to provide clarity for employees, and set out a transparent framework of a company’s terms of engagement. It is, however, merely a foundation; it’s not the end of the job, it is just the beginning.

Though it should never be considered a ‘working document’, regular reviews between HR teams, senior management and legal partners can ensure that company policies reflect present-day challenges, legislative change and protect both employer and employee interests.

Surprisingly, there are still examples of companies that fail to meet the statutory requirement to issue employment contracts within two months of any employment commencing. The absence of a firm contractual basis for an employment relationship can place a company on awkward footing later in the employee journey.

The road less travelled
Familiar landmarks along the employee journey include confidentiality breaches, IP protection, discrimination and mass redundancy. Succession planning can also lead to employee disputes. In recent times, there has been an increase in less common employment issues, many of which reflect cultural and technological evolution. A topical example is the issue of workplace immigration in the wake of the UK’s tougher legislative stance on migrant labour.

Another evolving challenge is social media, the growth of which is beginning to have significant implications for the workplace environment. Social media policies are increasingly common, not only to protect corporate reputations, but also to control employee productivity. A recent case led to an employer seeking a High Court injunction regarding ownership of information an ex-employee had accumulated via LinkedIn during the term of their employment.

The information age has also become a catalyst for the generation of huge volumes of data – as well as simpler means of transferring and storing information. This has led to an increase in confidentiality breaches and the theft of intellectual property of all varieties. Alongside this, the development of sophisticated data trails has given added stimulus to whistle-blowers, enabling them greater access to documentary evidence of incriminating practices.

Changes to legislation around discrimination presents further challenges for employers. Now covered by the Equality Act 2010, discrimination law has been extended to include age, disability, gender, ethnic origin, religious beliefs and sexual orientation.

Recent high profile examples indicate the breadth and variability of discrimination matters, and how inadequate protection can engender major reputational damage. Major consumer names such as M&S, Tesco’s and British Airways have each faced national scrutiny over their sensitivities to employees’ cultural and religious beliefs.

Partnership: for the journey
In an ever-changing business climate, the importance of sustaining a strong relationship with an employment lawyer cannot be over-estimated. It’s only by engaging in an ongoing dialogue with a trusted advisor that companies can respond to – and indeed plan for – the everyday challenges in the workplace. Employment issues often arise quickly and frequently – but a company’s speed of response can make all the difference.

Employees will undoubtedly come and go – but for employers, the journey is never-ending. The answer is to ensure that you never stand still – and to understand that there is always scope to adapt policies to reflect the changing market place. And by working in close partnership with a trusted legal advisor, you can make sure that the journey is safe, enjoyable and fruitful for both your business and its employees.

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