Employment Law Update – December 2021
Thursday 23rd December 2021
The Redundancy Process – US vs UK
The US mortgage firm Better.com made headlines earlier this month for its handling of a large scale redundancy situation, highlighting differences between UK and US employment law.
In the US
In almost every US state employment is considered ‘at will’, meaning employers can dismiss employees on no or very little notice for any reason.
The boss of US firm Better.com, Vishal Garg, invited 900 employees onto a Zoom call earlier this month with no prior notice and told employees: “If you’re on this call you’re part of the unlucky group being laid off”. The call was uploaded to social medial where it quickly went viral. Garg has since apologised for his handling of the layoffs, but his actions were not contrary to US employment law.
In the UK
Unlike US employees, employees in England and Wales with at least 2 years’ service are protected from the same sudden dismissal by law. Employees are entitled to a fair redundancy procedure, statutory notice pay and a statutory redundancy payment as a minimum.
A fair procedure must follow a number of stages:
- You must first consider whether redundancy is necessary and whether it is possible to make any other changes to avoid it.If redundancy is necessary, you must warn and consult with employees. If you intend to dismiss 20 or more employees within a 90 day period then you must also consult with trade union or other elected employee representatives.
- If redundancy is necessary, you must warn and consult with employees. If you intend to dismiss 20 or more employees within a 90 day period then you must also consult with trade union or other elected employee representatives.
- Crucially, you must choose a fair basis for selection. Whichever method is chosen, the selection process should be carried out impartially and care is needed to avoid unintentional discrimination e.g. selection based on experience which results in only the youngest staff being dismissed.
- Finally, employees made redundant must be given the right to appeal the decision.
Employees are also entitled to statutory notice pay and statutory redundancy pay as a minimum. If an employee’s contract of employment entitles them to a higher notice or redundancy payment then it is the higher sum which must be paid.
The redundancy process in England and Wales offers far greater protection to employees. It is stricter and more time consuming than the US equivalent and following a fair process is necessary to avoid claims of discrimination or unfair dismissal. If you require any advice on how to approach a redundancy situation or carrying out a fair selection process please do not hesitate to contact a member of the team.
Workplace ‘banter’: the dangers of crossing the line to discrimination and harassment
Given the recent racism scandal in the world of cricket, employers should be careful to identify the difference between workplace ‘banter’ and discrimination to avoid claims being brought against them.
‘Banter’ is a common concept in the workplace as it can be a good way for employees to build relationships but where to draw the line will always be a problem. An intended joke might easily cause offence and, if it relates to a protected characteristic it is likely to amount to an act of discrimination. In turn this can lead to compensatory awards being made against employers and long-term reputational damage.
It is worth mentioning that many leading lawyers take the view that in an Employment Tribunal if an employer needs to resort to the explanation that it was “just banter” then they’ve probably already lost!
A recently decided case, Anca Lacatus v Barclays, evidences where workplace ‘banter’ has proved costly.
Facts & Decision
Lacatus (L), a junior banker for the Respondent (Barclays), claimed direct sex discrimination against her boss for repeated use of the term ‘birds’ in the workplace.
The Judge stated that the use of this language was derogatory and “plainly sexist” and amounted to something that a reasonable employee could consider to be a disadvantage.
It was held that direct discrimination had occurred as there was no doubt that the comments were made due to L’s sex as the term was used to refer to women.
Although L had not immediately raised the issue as a grievance, thus letting it continue, it was found that due to L being a junior employee she feared damaging her career if she was to raise the issue.
This case emphasises to employers the importance of approaching workplace ‘banter’ with caution as claims of discrimination can be successful even where there is no objection at the time.
You should make it clear to employees that any jokes or ‘banter’ relating to an individual’s protected characteristic can amount to discrimination and harassment claims, even where this only occurs as a “one-off”.
You should ensure that the standards required are emphasised to employees as this benefits them and helps you to demonstrate a ‘reasonable steps’ defence if claims are brought against you. You can do this through the use of:
- Robust, updated policies on: equality and diversity, anti-bullying/harassment, social media/internet/email. Ensure these are reviewed regularly and brought to the attention of employees along with the relevant consequences for any breach.
- Effective management of grievances and disciplinaries in line with the relevant policies, ensuring appropriate action is taken.
- Provide regular, up-to-date equality and diversity training for employees.
Working from home: How to avoid the risks
There are many potential risks for employers to consider now that many employees have returned to home working.
It is generally much easier for employers to monitor employees and understand when they need support when they are physically in the workplace. You should ensure that you are regularly checking up on your staff and making sure they are happy and, if they are not happy, providing the relevant support they require.
Checking up on staff could be done through the use of regular virtual meetings. Alternatively, you could arrange sporadic meetings in-person. You could also encourage social interaction between staff members, whether this be by arranging in-person social events or by arranging remote social events. This helps employees to preserve the employer-employee relationship. You should, however, be careful to ensure that any government guidance is observed in these circumstances.
For a number of reasons, employers can be seen to favour those coming into the workplace more regularly and, this presents its own risks including constructive dismissal and possibly also, discrimination. Inclusivity is essential: any less favourable treatment of those who are less visible due to being at home could easily lead you into difficulty.
An employer still has an implied duty to ensure the health and safety of its staff members if they are working from home. Although many employers have most likely already carried out risk assessments of employees working from home due to the pandemic, it is important that you consider whether this needs to be done again.
It is much more difficult for an employer to protect client, customer and employee data when it is not all in one central location, especially where an employee is living with other people. It is likely that employers considered this when home working was first introduced last year, however, it is worth regular review to avoid disastrous consequences, especially with the exponential growth of cybercrime. You should ensure you provide clear practical guidance to employees with regard to data protection and confidentiality and highlight the potential consequences as a result of breaching such guidance.
Most importantly, you should ensure that you have a clear and well-drafted home working policy in order to regulate all home working arrangements. Having such a policy in place helps anticipate any potential issues.
If you need help drafting or updating a home working policy or have any other queries in relation to home working, our employment team will be happy to help.
If you require any further information on the above developments or any other HR or employment law issue, then please contact one of our employment law experts below.