Discretionary Terms   Myths of Modern Management

The cost of workplace sickness.   Steps to reduce it

Harassment at work   An increasingly expensive and problematic matter

To “Veil” or to no a “Veil”   This case illustrates four types of discrimiation.

Discretionary Terms

If you have a written contract of employment it may state that some things are discretionary. Bonus payments for example. Perhaps your contract says something like “the Company may in its absolute discretion award a bonus, the amount of which is not guaranteed in any way”.

So if the Company decided not to pay you a bonus this year, you wouldn’t have a leg to stand on legally. Would you? Well not quite, actually. A few recent court cases have shown that “Absolute Discretion“ may not be as absolute as many employers would like to think.

Now these court cases always seem to be brought by people who have just lost a highly-paid job in the City. Well they are the only ones who can afford the legal fees! But the principles are the same whether you are talking about a three figure bonus or a six figure one.

Take Mr Clark who worked for Nomura International. The Company gave him notice of dismissal and refused to pay him any bonus for the previous year. The court was shown Mr Clark’s contract which stated clearly that the bonus was discretionary and not guaranteed. However the court decided that Nomura were in breach of contract in depriving Mr Clark of his bonus and awarded him a shed-load of compensation.

How could that be? Well the simple answer is that there’s a lot more to a contract of employment than just the piece of paper it’s written on. Now of course written terms are very important and it’s a legal requirement to give them to your employees. But there are other terms in a contract besides written terms. In fact the things that are not written down can be just as important as those that are. They are so important that lawyers sometimes call them Fundamental Terms. And the most fundamental term of all is the duty of each party to act in a way that preserves Trust and Confidence in the relationship.

The Court decided that Nomura's decision not to award a bonus to Mr Clark (who had earned substantial profits for the company) was both perverse and irrational and amounted to a breach of trust and confidence. So Nomura ended up paying Mr Clark his bonus, as well as a fortune in legal fees. And the lesson for the rest of us? Just to be aware that if the contract states that the company has discretion, it must not be exercised in a way which destroys trust and confidence.

The cost of workplace sickness.

Imagine yourself feeling over-stressed and overworked, the thought of facing another day playing catch up and being reactive makes your stomach churn.Would you not look for an excuse to take a few days off work? This behaviour can turn into a vicious circle leading to reduced levels of productivity, performance and increased absence.  

Do you know the true cost of sickness absence in your organisation? It is not enough to just take into account the salary and temporary staff cover. For a true reflection of the costs involved, organisations should also consider lost productivity, lost sales opportunities and reduced product and service quality. Employers should also take into consideration the effect on the people who are left to cope with the work pressures caused by absent colleagues.

Managers have a significant role to play in managing lost time. They have the day to day responsibility of managing people performance, implementing relevant policies and procedures and accessing timely clinical advice.

What you can do

 Here are a few steps that employers can follow to reduce unnecessary absenteeism

• Introduce a policy that is clear and concise to avoid any misinterpretations
• Ensure a return to work interview is conducted by trained line managers, who will address issues promptly. Line managers should also have the relevant legal training for the situation.
• Anything longer than 2 weeks absence must be investigated and action taken if necessary.
• Monitor the pattern - The reason for absence should be recorded and checked periodically since it can indicate stress or other health problems.
• Ensure managers at all levels take workplace sickness seriously and that line managers are given the autonomy and tools to provide the necessary guidance to reduce it.
• Support health initiatives and provide information on health living. The British Heart Foundation, for example, provides a Workplace Health Foundation toolkit, with information, practical ideas and materials to help employers encourage their staff to lead healthier lifestyles.  

For ‘Return to work interview’ training contact us on 01473 890037.

For more information, please see the full article.

Causes of workplace sickness

Companies cannot effectively manage attendance unless they know the true causes and whether employees tell the truth will depend on the organisation’s culture.

Firstly, it is important to be aware of the main health issues that can arise in the workplace:

Stress

As we have already said, stress can be a major issue and the main cause of sickness absence. Ensure senior and line managers:

• Understand the standards that were introduced by the HSE in 2004 – organisations that don’t come up to scratch could face fines.
• Know how to recognise the signs and more importantly how to manage the situation instead of ignoring it.

Musculoskeletal disorders

Back and limb problems affect 1.1 million people each year and result in loss of around 12.3 million working days. Poor working habits and bad habits have a lot to answer for. Employers have a legal obligation to ensure safe working practices and that their people are not being injured by work.

Alcohol & Drugs

Research suggests that one person in 13 is dependent on alcohol and is responsible for 3 to 5 per cent of all absences from work. With workplace stress on the increase, this figure can only go up. Employees suffering from a drink-related problem are entitled to confidentiality and support.

Drugs affect the way a person thinks, behaves and perceives the world around them.

Look out for the following signs; poor performance, loss of concentration, mood swings, aggression and a tendency to become confused. Managers need training on how to deal with the problem in a confidential and supportive manner.

Employees in high risk jobs will not perform at their best if they are alcohol or drug abusers and will be a danger to themselves, colleagues and possibly the public.

Ensure you have a clear policy on alcohol and drugs, which will help managers ensure they follow procedures and deal with problems appropriately.

If you believe you have a problem in your organisation and would like confidential advice, please call Lina Hogg on 01473 890037.

Smoking

Smoking contributes to higher sickness rates and increased levels of early retirement due to ill health. Employers would do well to support those smokers trying to give up. A large number of organisations have introduced a no-smoking policy to help employees give up and prevent passive smoking.

Other health areas employers need to be aware of are heart disease, asthma (if you discover that an employee is suffering from work-related asthma, act quickly and remove them from the cause), diabetes and dermatitis.

Harassment at work

Did you know that an employer can be liable for workplace harassment even if they were not negligent in any way? The TUC estimate that up to 2 million are bullied at work in the UK every year.

We would suggest you think again if you believe it could never happen in your workplace. Until recently an employee had to prove that the employer was negligent in not stopping bullying taking place.

Following a recent case of Majrowski -vs- Guy's and St Thomas' NHS Trust , The House of Lords held that an employer may be vicariously liable for the acts of its employees if the abuse took place at work. Mairowski, who is gay, worked for Guy’s and St Thomas’ hospital. He claimed that his manager bullied and harassed him during the course of his employment and that the abuse was fuelled by homophobia.

This decision has a very serious implication for employers because whilst under existing discrimination legislation an employer has a defence if it can show that it took all reasonably practicable steps to prevent harassment occurring, the Majrowski decision has shown that such defence is not available to an employer facing a claim for vicarious liability under the Protection from Harassment Act 1997.

Worse still, a claimant has up to 6 years to bring a claim under this Act. Whereas for the act of discrimination the limit is 3 months! Also, the claimant can bring a claim not just against the employer but also the employee who carried out the bullying and harassment. Employers need to be aware that such claims may become prevalent due to this case. This means that employers need to be more vigilant than ever in looking out for signs of bullying and harassment.

Find out how employers can protect themselves in the full article.

Employers need to be pro-active in preventing bullying and harassment.

1. Where a case of bullying or harassment is discovered, take fast effective action. Conduct an investigation and decide of the remedial action, which should be well documented.
2. Ensure you have policies in place that emphasise that bullying and harassment will not be tolerated and the consequences if it is discovered, namely disciplinary action, which may lead to dismissal. The most important aspect of this is that the policies need to be consistently communicated and enforced.
3. Provide senior and line managers with training on what may constitute harassment and bullying and how to identify and manage it when cases are unearthed.

Ideally training should also be provided to all employees, which could become part of the induction process. Unfortunately, the bad news for employers is that, following the Majrowski case, these preventative measures may not be a defence to a vicarious liability claim under the Act – and there lies the problem!

At the end of the day for employers it is all about being vigilant. Picasso HR is experienced in developing harassment and bullying policy and delivering effective training for people at all levels. If you are interested please contact us on 01473 890037.

To “Veil” or to no a “Veil”

A few weeks have passed since Ms Azmi’s well publicised case was heard by Leeds Employment Tribunal. Ms Azmi was of course the lady in the veil - the Muslim teaching assistant who became famous after refusing to remove her veil while teaching. Aside from all the publicity the legal issues are worth examining because they will apply in many less extreme situations.

This case illustrates four types of discrimination;

• direct
• indirect
• harassment
• victimisation

Ms Azmi brought a claim under the Religion or Belief Regulations that her suspension for refusing to wear her veil amounted to less favourable treatment on the ground of her religious belief. This is an allegation of direct discrimination. The tribunal had to ask itself whether she was treated unfavourably because of her religious belief.

Direct

To answer the question the tribunal had to decide whether someone else would have been treated the same way if they were wearing a head-cover but they were not of the Muslim faith. The tribunal decided that someone wearing say a balaclava would have been treated in the same way as Ms Azmi, so her complaint of direct discrimination failed. .

Indirect

Next the tribunal had to consider the claim of indirect discrimination. Indirect discrimination occurs where a provision, criterion or practice (PCP) is applied which puts persons with a particular belief at a disadvantage compared to others.

Clearly Ms Azmi was put at a disadvantage because of the school’s rule that she couldn’t wear her veil. Now the big difference between direct and indirect discrimination is that indirect discrimination is OK if it is justified. The legal test is whether it is “a proportionate means of achieving a legitimate aim”. The tribunal accepted that there was a legitimate aim, because it was necessary for a teaching assistant to communicate fully with children. Furthermore, the means of achieving it were proportionate, as Ms Azmi was able to wear her veil in the staff-room when she was not teaching. So Ms Azmi failed with her claim of indirect discrimination because her employer proved that the discrimination was justified.

Harassment

Harassment is unwanted conduct that violates a person’s dignity or creates an intimidating, humiliating or offensive environment. The tribunal rejected Ms Azmi’s claim of harassment.

Victimisation

Victimisation occurs when someone is treated less favourably because they have made a complaint of discrimination. The tribunal found that there had been a change in the employer’s attitude to Ms Azmi after it became known she had contacted ACAS and written to her MP. Furthermore, the employer had not dealt with a grievance which Ms Azmi had submitted. On account of these failings it was found that Ms Azmi had in fact been subject to unlawful victimisation.

Ms Azmi was awarded £1000 and this was increased by 10% because of the employer’s failure to comply with the statutory grievance procedure. As we said previously, this was an interesting case on its merits. It nicely illustrates all four types of discrimination and how an employer can get most of it right then fall down at the final fence

The information in this newsletter is of a general nature and is not a substitute for professional advice. You are recommended to obtain specific professional advice before you take any action.

For further information, advice or assistance on any of the matters raised in this newsletter please contact Picasso HR on 01473 890037.

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