Staff with a grievance get paid off with compromise agreement by employer

Nearly eight out of 10 employers would rather pay off a former employee with a grievance if the cost of fighting their claim outweighs the cost of a compromise agreement, according to research by Personnel Today’s sister publication, Employment Review.

The survey of HR practitioners in 101 organisations, which together employ more than 340,000 people, found that 82% made use of compromise agreements rather than contest an employment tribunal claim.

Most commonly, those questioned said they would use such agreements if the cost of fighting an employment tribunal claim was prohibitive (78%). Most (63%) would also do so if they feared damage to their reputation among customers and potential customers.

Less commonly, employers would seek to make a deal with a former employee who stood a good chance of winning at a tribunal (54%), where the organisation was known to be in the wrong (44%), or where there was a risk to damaging its reputation with potential future employees (38%).

Many employers also said they would seek to reach a compromise agreement with any senior employee who leaves (38%).

Compromise agreements, which were introduced under the Trade Union Reform and Employment Rights Act 1993, are formal, legally binding deals and must satisfy a number of conditions laid down by law.

In particular, the agreement must be in writing, it must relate to a particular complaint, and the employee must have received independent legal advice about its content.

… but notice periods are a matter for some negotiation by employers

Few employers are prepared to force someone who has been made redundant to work their notice in full, the Employment Review survey shows. But most would do so if the employee had resigned.

Six out of 10 employers (59%) said that in the event of a redundancy, they would try to reach a mutually agreeable leaving date with an employee. One in four (26%) said they would not expect the employee to work any of their notice under these circumstances.

Very few said they would force the employee to work some (9%) or all (7%) of their notice period.

Where an employee has resigned from their position, more than half (53%) of the employers said they would expect the individual to work their contractual notice period in full.

Four out of 10 (39%) said they would be willing to reach some form of compromise about a leaving date. One in 10 (9%) said they would expect the employee to work some but not all of their notice.

More than half the organisations surveyed (52%) also said that there were some categories of employee who would be expected to leave the building immediately once their departure had been decided.

These included not just staff found guilty of gross misconduct, but also those with access to sensitive information, those leaving to work for a competitor, and those working in roles where they could have an adverse commercial impact on the company.

… and the notice required depends on your job

Although minimum notice periods are laid down by statute, most employers have contractual terms over and above these, and often operate different notice periods for separate groups of employees.

The Employment Review survey found that just 27% of employers had the same contractual notice periods for all employees, while 73% operated two or more arrangements.

Most commonly, employers had different arrangements based on seniority (72%), but one in four had historic or inherited arrangements to deal with (27%), or had different arrangements for blue- and white-collar employees (36%).

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