The law relating to unfair dismissal was the starting point – the emphasis being on the right not to be unfairly dismissed. Employers and employees realized that dismissals would be deemed fair but not if substantive or procedural points were ignored. However, today we have ended up with a complex maze of law in which there is a lack of certainty about the underpinning principles to be applied in working life.  Attempts to make it simpler to dismiss via protected discussions and settlement agreements will not solve the issues.

Formerly, Acts of Parliament were relatively simple and the Employment Appeal Tribunal and Court of Appeal laid down clear principles to guide discussions in many areas of employment rights. For example, the principles for dealing with ill-health cases were set out clearly in Spencer v Paragon Wallpapers (EAT 1976) so that employers knew that they should:

• Consult with the individual about the nature of the ill health
• Obtain a medical opinion if that is appropriate
• Warn the employee that his/her job will be in jeopardy if attendance/performance does not improve etc.

Managing on Shifting Sands

As the views of society evolve so laws are updated or created. Today, employment aspects such as discrimination and the transfer of undertakings are complex and like shifting sands.  The Courts appear to be limiting the effect of some previous decisions and the extent of regulations but that adds to the feeling of managing on shifting sands. Instead, we need to stand back and set out clear principles that should be applied to the employment relationship and draw the lines so that both managers and employees know where they stand. If an employer or employee crosses the line then they should face the consequences. It is true that managerial life is not black and white and there are many grey areas but that should not prevent us from establishing principles that can be easily applied to the majority of situations.

Two main grey areas are to be found in the law relating to discrimination and transfer of undertakings. Because many employers and lawyers become submerged and lost in the maze of nuances of the law in such areas, compromise agreements or settlements have become more widespread. The reasons are not necessarily that the employer was wrong but the law is too grey and it takes too much time to establish the true position. Hence, employers reach for their cheque book. In discrimination, we have reached the point at which many aside jokes are made such as, “I must not say that or I’ll be tied up in a tribunal”. I suspect that the speaker is often covering up a lack of confidence as to what are the true principles to be applied.

No Encouragement for Cowboy Employers

Another consideration is that with the current employment situation, some employers adopt a cavalier management approach of ‘lump it or leave’. The aims of the legislation are thwarted by such attitudes as discrimination and poor management practices will still occur. The solutions should not bolster such cowboy attitudes to managing a workforce. With that in mind, we need to be careful about exempting small employers from clear legal principles and effective management practices.

What Should We Do?

Some thoughts are given on ways to clarify the principles that managers should apply to the employment relationship.

1. We need to return to setting out the principles in a clear and easily understood way especially in discrimination.
2. Those principles should be published by ACAS and accessible on web sites to employees and employers but the temptation to expand the principles into booklets should be resisted. If the principles are not clear in their own right, then we have failed to establish the key principles.
3. Each area of law should be codified, not in a legal code I hasten to add, but in a one page or less set of bullet point principles.
4. Current legislation should be simplified with the key principles at the heart of the act or regulations.  That will require Parliamentary time or an enabling Act to give more discretion to the Courts as below.
5. Courts should use precedent and judicial interpretation to bring more clarity to the complex areas such as discrimination and transfers of undertakings. They should set out the underpinning principles so that those can be extracted for employers to use as guidance in daily management decisions.
6. The EAT should play a greater role in teasing out the key principles of discrimination etc. in a way that is identifiable by employers. To that end, the EAT should continue to use lay advisers sitting with a judge so that realistic principles can be distilled. I say that recognising that the recent changes are likely to lead to less lay advisers but may be at EAT level there is more need so that precedents around principles can be re-established.

It seems currently that we are just sticking a plaster over the cut or graze rather than taking action to minimise falling over.

With the emergence of more regulations on executive pay, may be the above should also apply to that area of law or, better still, the practical approach to the new pay reform proposals should be the subject of the next blog article.

© 2012 HR Management Dimensions Ltd.

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