There are two things that every employer needs to know about employment law:
1. It is complicated
2. There is a lot of it.
Separated into a number of distinct but overlapping areas, employment law is an area in which businesses are most at risk of getting involved in litigation.
Having the appropriate policies and contracts in place from the start can help to avoid future problems. Here are some useful pointers to help you reduce the risk of a claim.Initial Considerations | The Job Offer | The Contract of Employment | Healthy Working Relations
There are many considerations that need to be taken into account long before that first advertisement goes into the public domain:
- Who are you looking for and why? Advertising for candidates must not be discriminatory – so consider any discrimination laws that you could be breaching.
- Ensure that all criteria can be objectively justified. Advertising for someone who meets a specific criterion could also be discrimination.
- Try to establish standard, objective selection criteria for choosing which candidates to interview. You could consider a ‘blind’ selection process whereby all personal details are unknown to those involved.
- When inviting candidates for interview ensure that disability discrimination legislation is considered. For example is your your interview room wheelchair accessible or free from fluorescent lights? If not, you could let candidates know in advance and ask them to notify you if this is likely to be a problem.
The Job Offer
When offering the job consider the terms to be offered:
- Is a fixed-term contract appropriate? Remember that a fixed-term contract can be both a benefit and a burden, particularly if the employee does not live up to expectations.
- Consider if a probationary period is necessary or desirable and also what package should be offered. Should this be phased in over time or begin immediately?
- If you do not have an existing company pension scheme what pension provisions will you offer? Remember that you are required to deal with pensions in the contract.
- The job offer should contain sufficient information for the candidate to assess the role. In many companies, the offer letter performs a multiple role and is a statement of terms and contract of employment. This should be avoided and a proper contract of employment drafted, particularly for senior staff, managers and directors.
The Contract Of Employment
Don’t forget that a contract of employment is a contract like any other and you are obliged to fulfil your obligations under it, otherwise you could face a claim for breach of contract.
- Consider the job the employee is to do and the remuneration offered, be wary of contractual bonuses, commission payments and obligations to increase or review salary annually.
- The contract should be drafted by a professional. It is imperative that the contract covers all of the appropriate matters and does not include matters that should appear in the office manual. There are statutory requirements for a statement of terms or contract of employment that must be included.
- For more senior employees, or those in a privileged position, ensure that adequate provision is included for confidentiality; fidelity – including adequate post-termination restrictions; and notice periods – consider payment in lieu of notice options and garden leave.
- It is not easy to vary a contract of employment so ensure that any provisions or policies requiring a level of flexibility are left to the discretion of the employer.
- Where applicable, ensure that collective agreements are adequately incorporated into the contract.
Healthy Working Relations
The employment relationship should be rewarding for both employer and employee, however many relationships fail and turn sour. But there are a few final points for you to watch out for:
Dismissal is the cause of most problems. If you are considering this, for any reason, seek legal advice first.