HR horrors: How to avoid a Halloween nightmare

Does your HR department have any skeletons in its closet?

As Halloween approaches, it’s time for HR professionals to reflect on the often nightmarish legal situations they face. Clare Gilroy-Scott, Katee Dias and Emily Kearsey consider four scary scenarios.

1. Sensitivity around sexual harassment

An employee has resigned claiming she was sexually harassed. The business has accepted her settlement offer and has tasked you with drawing up her settlement agreement and also taking steps to try and reduce the likelihood of this situation happening again. How do you go about this?

When drafting her settlement agreement there are various special considerations to bear in mind because sexual harassment has been alleged.

Firstly, any confidentiality provisions need to be carefully drafted and it’s advisable not to stop the employee from making various disclosures, such as reporting the situation to the police.

Secondly, there are some provisions that simply would not be appropriate in the circumstances. For example, the employee shouldn’t have to warrant that her complaints have been satisfactorily concluded.

Thirdly, be more patient than usual when waiting for her to return the signed agreement.

To help ensure situations like this are not repeated, you should:

  • take grievances (and also any rumours/grumbles) of sexual harassment very seriously. Even though these claims are being settled, you should still investigate allegations and, if you conclude that there is a case to answer, start a disciplinary process against the alleged harasser(s);
  • implement (or update) your equal opportunities and anti-bullying and harassment policies, plus make sure that all your employees are aware of and understand them; and
  • train managers and other senior members of staff so that they can recognise and deal appropriately with sexual harassment.

2. Covert recording complexity

Picture the scene: you’ve discovered that an employee secretly recorded a confidential discussion between himself and HR. Has he committed gross misconduct (meaning that you can immediately dismiss him without any notice)?

A recent Employment Appeal Tribunal case, Phoenix House Ltd v Stockman, grappled with this very question and decided that the answer will depend on the specific circumstances, including:

  • Was the employee manipulative, seeking to entrap his employer or a vulnerable employee simply seeking to keep an accurate record of the discussion?
  • Was he told not to make such a recording or was he asked and then he lied about making it? Or was he a distressed individual who scarcely thought about culpability?
  • Did the meeting concern just that employee and would a record normally be kept anyway? Compare that to a meeting containing sensitive information about the employer generally or other employees too.
  • Is a prohibition on covert recordings included in the employer’s disciplinary rules?

In the case mentioned above, it was held to be ordinary misconduct, despite the employer arguing that it should be treated as gross misconduct.

Key factors included the HR person describing the meeting as “pleasant and in no way confrontational” (indicating that the employee was not seeking to entrap the employer) and the fact that there was nothing in the employer’s disciplinary rules about not taking covert recordings.

3. Holiday humdingers

Employers commonly face queries arising out of part-time working and bank holidays, particularly as the festive season approaches.

The entitlement is 5.6 weeks’ leave per year which equates to 28 days for a full-time employee. There is no automatic entitlement to bank holidays so arrangements over bank holidays must be clearly communicated.

This means that someone working a three-day week would be entitled to three-fifths of the full-time entitlement. If a bank holiday falls on one of their normal working days and the business is closed, they would need to take a day of holiday entitlement.

Compulsory holiday on bank holidays will vary from year to year for part-time workers depending upon when Christmas falls. It can be helpful to let part-time workers know how the bank holidays fall in each holiday year, so they understand how many days they can take.

Employers should also be cognisant of what employees should be paid for a day of holiday as recent case law is clear that variable pay such as overtime and commission should be factored in.

4. Troublesome TUPE

When you are selling a business or a part of a business, what do you do if an employee does not want their employment to transfer under TUPE?

Employees do have the right to object to a transfer. The objection needs to be clearly communicated to either their current employer or the business taking over. No notice is required to be given and the employment will terminate by operation of law on the date of the transfer. An employee who objects is not entitled to contractual or statutory compensation.

In this case, the employer needs to assure itself that the employee is objecting to the TUPE transfer and is not actually resigning. If the individual resigns then his notice period may mean that he is employed on the date of transfer and so transfers automatically to the new employer.

Care should also be taken to ensure that the employee is not resigning and claiming a ‘deemed dismissal’. A deemed dismissal could be on grounds of an alleged repudiatory breach or that it is in response to a substantial change to the employee’s working conditions to their material detriment both of which could lead to claims.

TUPE requires a certain amount of information and consultation. Ensuring you consistently provide clear information about the implications of a TUPE transfer can minimise employee concerns.


About Clare Gilroy-Scott, Katee Dias & Emily Kearsey

Clare Gilroy-Scott, Katee Dias and Emily Kearsey are members of the employment team at law firmGoodman Derrick
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