In the current economic climate, a wide range of employers in both the public and private sector are continuing to look for long-term cost savings and making significant changes in their businesses. Such changes include redundancies, lay-off/short-time working and variations to employee’s contracts of employment. Just last month, BAE Systems announced 1400 redundancies at their Lancashire factories.
The law surrounding the termination of an employee’s employment is complex, with several procedures to follow. By not strictly following employment law when making redundancies or terminating an employee’s contract on other grounds, employers face risking the full force of the Employment Tribunal, which can be an extremely costly and stressful process. It is a very difficult balancing act for employers to ensure the process of reducing staff overheads is completed effectively and within the confines of the law, whilst also maintaining their commercial objectives.
Employers can seek to minimise the risk of facing employment claims by:
- Seeking advice at any early stage. This ensures that the employer is at a tactical and strategic advantage. It is also vital for employers to ensure that they strike a balance between following the law whilst retaining a commercial approach.
- Utilising compromise agreements where appropriates. Compromise agreements can be used in a wide range of scenarios/disputes to fast-track the termination of the employee’s employment. A confidentiality clause can also be drafted into the agreement which prevents them from disclosing any of the details of their termination of employment, which can protect employers from any future comeback.
- Conducting regular reviews of employee’s contracts of employment and company policies to ensure that they are up to date, compliant with law and include additional provisions to protect your business, whilst allowing for necessary flexibility.
- Identifying employee complaints and grievances at an early stage and managing these effectively.
- Ensuring the relevant Directors, Senior Management and HR in your business have the necessary training on how to deal with employment law matters and disputes and/or ensuring a nominated Director has access to employment law advisors for on-going support.
Farleys are specialists in employment law for employers, helping businesses across the North-West and beyond to avoid the many pitfalls associated with employing staff.