Employment law and HR issues - Divorcing your Employees
To all the businesses out there who might be facing messy “break-ups” with
Sometimes it all goes smoothly – the employee resigns to emigrate to Australia. The company wishes them well, throws a leaving party and they leave on good terms. As an employment lawyer, I rarely get to hear about these situations - I am usually called in when it has all gone horribly wrong.
What many employers don’t realise is that parting company with an employee can be like a divorce. A meaningful relationship has broken down and the parties must separate and move on to find new partners. A full-time employee may spend more time in the office with their colleagues than in their own homes with their family. A close relationship of trust and loyalty has been built and then lost. Many employee clients have explained this is akin to a divorce, or a bereavement. They need to mourn the loss of the relationship and this process takes time, and may involve post-breakup bitterness.
There are often underlying reasons for an employee’s dissatisfaction and resignation, such as not getting the opportunities they need to progress their career, being bypassed for promotion, or not feeling valued or rewarded . Worse still, they might be suffering from bullying or discrimination.
What can employers do to prevent relationship problems ending in divorce?
Of course you cannot turn back time and undo any wrongs or failings that have already occurred, but you can try and resolve issues before they escalate and result in resignation or dismissal, and try and save the relationship. For example:
- Implementing a company-wide feedback process to enable employees to make suggestions, comments and complaints informally.
- Having a meaningful grievance process where complaints are listened to and not just heard.
- Using a 360 review process for appraisals enabling employees to have input into their own performance assessments, training needs, etc.
- Holding appraisals at regular intervals. You might think that since you give informal feedback on a daily basis that you don’t need to have formal appraisals. This is a common mistake. Providing a specific forum for feedback both ways avoids the need for either side to have to muster up courage to raise an issue and helps to prevent problems festering.
- Encourage a culture of openness within the company, whether an open-door policy to managers, a mentoring scheme or a generally supportive environment – this will help to nip potential problems in the bud.
I am not including well-justified gross misconduct dismissals where acrimony is inevitable. After all, the employee has betrayed your trust and behaved unacceptably. Just make sure you have sufficient evidence, have acted reasonably and followed proper procedures in the dismissal. It is prudent to get legal advice in these situations.
It is the no-fault dismissals in which you can make a difference, for example redundancy situations due to financial problems, downsizing or restructuring. Redundancy often leads to feelings of worthlessness for the employee, and the very frightening prospect of having their livelihood taken away, especially with a mortgage and/or family to support.
The reality is, that a disgruntled ex-employee is far more likely to try and take the company to task and bring an employment tribunal claim than one whose exit was handled differently.
I once had an employee client in her 60’s (let’s call her Betty) who was “made redundant” after 20 years’ service to make way for a younger, prettier version. She had been thinking of retiring soon, but wanted it to be her decision when she was ready. The company took this choice away from her when they told her out of the blue one day that she was going. They handled it very badly, failed to follow proper procedures, and made her clear out her desk the same day. Betty was made to feel she had done something wrong. Similarly, I have had other redundant employee clients who have been marched off the premises by security guards and made to feel like criminals. Needless to say, Betty and others like her were so upset they went to see a solicitor. Betty told me that if her leaving had been handled differently and she were treated with respect, she would have accepted her termination (albeit reluctantly) and never have brought employment tribunal proceedings. After 20 years, all she really wanted was a nice card and “a bit of a leaving do”. Instead, it cost her ex-employer thousands of pounds in legal fees and compensation for her discrimination claim, all of which was avoidable. Betty’s experience is a salutary lesson for employers.
What can employers do to ease the transition and prevent tribunal claims?
Many employers just want to take the emotion out of the equation when someone leaves, but this is quite often impossible as people cannot help having feelings! We are back to the relationship breakdown again. Just imagine being dumped by your long term partner by text or through a third party? It is not just the fact of the break up, it is the method.
If termination is inevitable, then there are steps you can take to try and make it less painful for all concerned, based on common sense, good employment practice and simple courtesy:
- Treat the leaving employee as a human being. However corny, if we put ourselves in the other person’s shoes, we would probably behave differently. It might be difficult as a business owner or manager to put your own feelings to one side, but try and treat your employee as you would like to be treated if it were you – simples!
- Get HR involved. Whether your own HR department, or external HR consultants, it’s sensible to involve the professional “people managers” at an early stage. They can advise you on best practice and use their wealth of experience to guide you through the process, but you should avoid the temptation to hide behind them!
- Be open and up front with all your employees, both leaving and staying. There is nothing worse than a workplace filled with whispered conversations, closed doors, gossip, fear and mistrust. If there are redundancies, announce them as soon as you can (to clients and staff) and handle them professionally. If there is a resignation, agree the wording of the announcement to staff, something like…”John is moving to pastures new on [date] and we thank him for all his hard work and wish him the best in his career”. Train managers to be brave and deal with employees face to face (box of tissues handy!).
- Allow time for adjustment. There is nothing more likely to aggrieve an employee than being told they are redundant and to clear their desks and leave the same day. This allows no time for them to come to terms with your decision. I realise some companies want to protect themselves from potential harm (such as making negative comments to clients, or taking client lists) but they only increase that risk by this sort of treatment. In any event, the enforced speedy exit would not stop an employee who is hell-bent on revenge. Mutual respect and professionalism on both sides goes a long way. If you are following correct redundancy procedures, then there should be a lead-in time during the consultation. Once the decision is made, consider carefully whether you need to put them on garden leave, or could they work out their notice, hand over their work properly and have time to adjust to the idea of not working for you anymore?
- Exit Interviews. Invite a frank and honest discussion with leavers about their views on the company and if they resigned, their reasons for doing so. Act on it afterwards. If an employee resigns because Sue is a nightmare to work with, Bob kept leering at their chest, or they felt unable to progress then alarm bells should be ringing. You might get an insight into your poor retention problems. If necessary, get legal advice about what risks and liabilities you might face and how you can limit these and protect your business. If nothing else, a candid exit interview clears the air enabling both parties to move on.
- Show appreciation. It is a fallacy that there is no point rewarding exiting staff. After they leave the company, wouldn’t you like them to be your ambassador for the future? Successful entrepreneur Dave Balter remarks in his insightful article that you can never underestimate how ex-employees can benefit your company - if they leave on good terms they might remain an important industry contact who can refer work to your business. In practice, simple things can make a real difference to a departing employee:
- Thank them for their contribution at the very least. It costs nothing but is
worth a lot.
- Arrange a collection for a leaving present and put in some money from the company, or buy a bunch of flowers, or even just get their colleagues to sign a card. I know money is tight (we are in a recession after all), but it’s the thought that counts, and even a little inexpensive gift shows you care.
- Throw a leaving party (especially if they have long service), or consider just allowing staff to leave half an hour early on their last day to have a drink down the local pub (and put a small contribution behind the bar!) This gesture will raise spirits and you will be remembered for it.
- Arranging for redundant employees to receive post-employment support is a good investment in employee relations and also good risk management. Being made redundant can destroy a person’s confidence, hampering their ability to find new employment. Some professional help to write their CV, career coaching, interview skills, etc. can be invaluable to get them back on the employment ladder and into their next job. On a cynical level, the quicker they find a new job, the less likely they are to sue you for unfair dismissal as the incentive is to move forward rather than to look back, and furthermore, lowers the value of their loss of earnings claim.
Further benefits to your business
Don’t underestimate the benefits of a friendly exit – the workplace atmosphere is not so strained, there is less hostility, managers feel more comfortable dealing with those who are leaving, those who are left feel reassured that they will be treated decently when their time comes, and most importantly, those who are leaving feel they were valued and will be missed. Consequently, your risk of receiving employment tribunal claims from unhappy and resentful former employees is reduced.
Gelbergs Solicitors is based in Islington, London N1 and offers a comprehensive multi-disciplinary HR advice and employment law service to employers. We would be happy to hear from any business owners who are considering making redundancies, or need HR or legal advice about any employment issues, or who would like a free assessment of their employment contracts, and HR policies and procedures.
Call us on 020 7226 0570 and ask for Emmajane Taylor-Moran or Jane Manville. Our website can be found at www.gelbergs.co.uk and twitter at @gelbergs.