Protecting your business: Compliance with employment law

Protecting your business: Compliance with employment law

Non-compliance with the requirements of employment law can give rise to significant liabilities and there are plenty of banana skins for the unwary. Employers should of course seek expert advice in individual cases but there are some basic steps that employers can take to protect their business.

 

Documentation

 

Employers are legally required to issue employees with written statements of employment particulars setting out certain basic terms of employment. However, employers can enter into full and comprehensive contracts of employment containing precise terms. Clarity of contractual terms, clearly understood by employees, can often avoid disputes arising in the first place.

 

Employment contracts should be periodically reviewed and kept up to date with current legislation and relevant to the employment of the individual employee. Similarly, employers should have in place rules, policies and procedures covering various aspects relating to the employees’ employment. These will typically include policies and procedures relating to discipline and grievances, equal opportunities, data protection, electronic communications, expenses, and company cars.

 

Again, policies and procedures should be periodically reviewed and kept up to date with ever-changing employment law. Indeed, an employer who relies on an out of date policy faces the risk of non-compliance with up to date legal requirements.

 

Communication and implementation

 

There is little point having comprehensive rules, policies and procedures if they are not communicated to the workforce. This can be done by issuing paper copies or by way of an intranet. Nor is there much point in having such rules, policies and procedures if they are not consistently applied.

 

For example, giving a written warning to an employee for a serious act of misconduct might lead to the unfair dismissal a further employee guilty of a similar act. Training employees with regard to rules, policies and procedures is an important aspect of implementation. Specific training to managers on how to deal with disciplinary matters and grievances, for example, can pay huge dividends and not only reduce legal risks but encourage an atmosphere of fair dealing and foster goodwill with the workforce.

 

Training is also vital if an employer is to stand any chance of relying on the statutory defence which, if successful, sets aside the usual rule that the employer will be vicariously liable for unlawful discrimination perpetrated by an employee.

 

Customer and trade protection

 

It is a common misconception that post termination covenants, for example those which seek to restrict an ex-employee from competing or soliciting customers, are unenforceable restraints of trade. The courts will uphold such covenants provided they go no further than they reasonably protect the employer’s legitimate business interests. Such covenants should be drafted with precision and relate to the employment of the individual employee. 

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