As a business owner you have devoted significant time, efforts and commitment for many years to your company. You have focused on developing your business, its customers, market and its business network, resulting in a successful company you are proud of with a solid economic foundation and the potential for continued future growth.

Before you know it, your retirement is looming or external factors such as family or health matters precipitate the need to hand over the company reins, whether this is to a family member, a third party or via a management buyout.

But what legacy are you leaving behind?  Was it all worth it? Will your business survive long after you? Are the management personnel you will leave behind really up to the job?

With any business it is fundamentally necessary to regularly consider, evaluate and undertake strategic planning and to re-structure and re-organise personnel.

It is not enough to have just focused on the corporate aspects, it is also critical to have also regularly implemented strategic planning, re-organisation and re-structuring from an HR and employment law perspective so that your business and your legacy remains a success.

HR and employment law aspects to consider and implement include:


  1. Employee exits
  • It is important to take time out to consider and evaluate your staff, and to take action. Exit employees that hold the company back, occupy management time unjustifiably and who are simply not going to benefit the future of the company.
  • Termination of employees’ contracts can be justified with a fair reason of poor performance. Ill-health, redundancy, business re-organisation, misconduct and some other substantial reasons, providing a fair process is followed and your company acted reasonably.
  • Obtaining specialist advice and support can enable the above and the manipulation of restrictive employment laws.
  • Establish the best way to manage processes, whether it be a formal process or an expedited exit by way of a “without prejudice” (“off the record”) or protected conversation and severance package. The use of a settlement (compromise) agreement to effect the termination of an employee’s employment can result in a prompt, amicable and commercially advantageous outcome for your business.


  1. Promotion & varying contracts of employment
  • Take action to ensure you retain the right staff in the business.
  • Promote key personnel. This in itself is a reward, can act as an incentive and lead to increased productivity from an employee.
  • Vary existing terms of employment by offering employee incentive schemes such as target related bonuses, enhanced contractual sick pay or improved pension schemes.
  • Remember to review contracts of employment or service agreements and to update or issue new ones. A regular occurrence I have witnessed in practice is the scenario where an employee has progressed through the ranks to a senior manager or directorship role and the business has never protected itself by issuing a new or updated and more detailed contract of employment or service agreement.
  • It’s important to remember that when varying any fundamental terms of a contract of employment, employers are obliged to consult an employee and obtain their consent. Some terms also require your business to offer an element of consideration, for example the introduction of post-termination restrictions.


  1. Recruitment
  • Don’t be afraid to recruit. It may be that a new skill set or a fresh face and personality could afford great benefits to your company, both in the short and long-term.
  • Remember that you can protect your business by issuing the employee with an appropriately drafted contract of employment. This can include terms that are beneficial to your company such as probationary periods, favourable notice periods, and garden leave, or even by the issuing of a fixed term contract.
  • If you wish to explore another arrangement, try agreeing terms with a self-employed person providing services to your business (perhaps with a view to an offer of employment in future). Remember to protect your business with a suitably drafted consultancy agreement for this engagement.


  1. Training
  • Consider training new and existing staff, whether it be for a particular bespoke skill or IT, digital, marketing, business development or management training.
  • Training can be a simple and cost effective tool to significantly improve employee output and to increase morale.


  1. Apprentices
  • Invest time and provide opportunities for apprentices. Generally these are young employees with a youthful eagerness and drive which can be very cost effective to a business.
  • It is commonly known that “learning on the job” can craft a better skill set than inheriting a wealth of university graduate employees. Over time you can mould these apprentice workers to suit your business and to fit seamlessly into a particular department and team.
  • Remember to issue an appropriately drafted contract of employment and obtain legal advice in respect of a tripartite agreement with a learning provider.


  1.  Assess employee performance regularly and take action
  • Assess employee performance by way of appraisals. These can also be useful as evidence if an employee is underperforming.
  • Manage any poor performance by way of implementing appropriate targets, support and training.
  • Promote and reward and incentivise employees that excel, to retain them in the business.


  1. Acquisition of other companies and/or outsourcing or insourcing of a service
  • Such commercial transactions may be of great importance to your business.
  • It’s likely that TUPE (The Transfer of Undertakings (Protection of Employment) Regulations 2006) will apply. TUPE protects employees’ terms and conditions and continuity of employment as they automatically transfer across retaining these rights.
  • This is detailed and complex legislation with extensive obligations on businesses, real risks of automatic unfair dismissal declarations and the costs of non-compliance can be substantial.
  • Expert advice will be required pertaining to these transactions going forward and upon inheriting new staff, you may also wish to harmonise your entire workforce’s terms and conditions of employment and/or to re-organise staff, their departments and your company structure.

For further information on any of the above please contact our specialist employment team on 0845 287 0939 or complete an online enquiry form.