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Helen Giles a HR specialist with particular focus on the charity sector, has raised some provocative issues regarding the employment tribunal process in a Times Opinion piece 4th January and again when interviewed on the Radio 4 Today programme 5th January. She writes:
“A major concern that perhaps hasn’t come out strongly enough is that the government is embarking on some major initiatives in an endeavour to stimulate the economy, reform the welfare benefits system and get long-term unemployed people back into work, and to achieve social improvement by involving community groups and charities in setting up and running social enterprises, locally run/free schools and so on. But the degree of employment regulation/employment law that has been introduced and the way that this law is administered by the Employment Tribunals system as it stands poses a major obstacle to achievement of these aims because of the costs and risks involved for employers in employing people generally, and particularly if they make the mistake of employing the wrong people, which is a very hard mistake to avoid all of the time.
In a nutshell, the issues are:
- The Employment Tribunals framework was set up in the 1960s as a simple and cheap means of jurisdiction in employment disputes. It has evolved into a complex system of legalised extortion, extremely costly to both employer and state (another unnecessarily heavy drain on public funds at a time when savings have to be found).
- The Coalition Government clearly has some inkling that there is a problem whereas the previous administration refused point blank to accept any need for a review, claiming that any reform of the system would lead to workers oppressed by hard-hearted employers being deterred from seeking remedy. Noises have been made about increasing the qualifying period necessary to claim unfair dismissal from one to two years’ continuous service. But this misses the point that many of the most vexatious, costly and troublesome cases are taken under one or other of the heads of discrimination, for which no length of service is needed – age, sexual orientation and religious and philosophical belief were added to sex, race and disability. 38,310 discrimination claims were lodged last year. It’s free to lodge the claims but employers have to pay legal fees from the moment they receive notification of the claim.
- The elaborate pantomimes that the law forces employers to play out when trying to deal with an employee’s poor performance or conduct for fear of a claim being made is severely restricting efficiency both in public and private services.
- Every year the volume of ET cases filed goes up exponentially – over a quarter of a million cases accepted in 2009-10, an increase of 56% over the previous year - so that the system itself can’t cope and in busier parts of the country it took 18 months for cases to be heard. Only 13% of these were successful in court. Two thirds of claims are settled out of court, sometimes because the employer has done something wrong or procedurally unwise but more often because the costs of fighting, irrespective of the weakness of the employee’s case, are prohibitive. The HR Director of a Housing Association recently told me that for the cost of fighting a case, which they won, they could have built three new family homes.
- No-win no-fee lawyers are shamelessly inciting people to submit claims on flimsy grounds because they know they can bully a settlement out of the employer on the eve of a case being heard, however weak the employee’s case. They know employers and their insurers (if insured) would rather pay out £25,000 for the employee to go away rather than £50,000 or more to fight the case in court, even if they are almost certain to win the case.
- I recently ran a Business Link seminar for small business people on how best to protect themselves against the perils involved in employing people. One participant told me that many of his small business-owning friends employ illegal immigrants cash in hand because although the penalty if caught is an unlimited fine and two years in jail, they see this as less risky than having workers on the payroll who are likely to exploit their limitless rights.
- It is going to be tremendously difficult for the Government to achieve some of its key policy objectives unless it undertakes a wholesale reform. The long-term unemployed about to be reintroduced to work constitute a massive risk for employers liable to have claims made against them when they try and part company with those who don’t work out. And the Government wants charities to play a large part in bringing about the ‘Big Society’, but charities always have to have some paid staff and the smaller ones are groaning under the burden, expense and risk involved in complying with an employment law system that has become so far skewed in favour of the employee, largely because there is absolutely no financial disincentive to pursue weak and opportunistic claims. Moreover, it is just very difficult to run an efficient workplace when employment law encourages people to present themselves as victims of bullying and discrimination whenever the employer justifiably tries to tackle their poor performance or behaviour.
- I have practical ideas of how reform can take place, for example every claim should be subject to a desktop assessment in precisely the same way as insurance lawyers have to certify the employer’s case as having more than 50 per cent prospect of success before they will underwrite it. Where the employee’s case is deemed as having less than 50 per cent prospect of success they should be advised that they will have to pay the employer’s costs if they insist on pursuing it. There are many others, including lawyers, who have all manner of practical suggestions. The general principle is that claimants must be made to bear costs if they lose cases.
- I have many true life astounding tales of the nonsense that gets entertained by the ET system, and the real costs to the organisations involved.
- Employment regulation more broadly is set up to undermine organisational efficiency. For example the TUPE (Transfer of Undertakings Protection of Employment) Regulations means that a service (say a social care service) often fails because the staff are so bad, yet when the service is re-tendered all the bad staff have to go with it, and the rest of employment law makes it really difficult to get rid of them. Or the regulation which states that when redundancies are being made, a woman on maternity leave has the automatic first right to any job that remains. This means s a poorer performing employee has to be kept in preference to a high performer just because the former has had a child. Or the ridiculous procedural lengths that have to be gone to before dismissing an underperforming employee – typically it takes a year or more to go through all the hoops before dismissing someone, so that employers often pay poor performers massive sums to go away – sometimes 100% of salary whereas in a typical performance related pay scheme the most someone can hope to earn as a bonus for exceptionally good performance is 10% of salary.”
Helen continues
“Statistical evidence, such as it is, can be found in the most recent Employment Tribunal Stats. There is no measurement in these or any other stats that I know about of the amount of time that is wasted by employers on dealing with workplace grievances leading up to claims, nor of the amount and sums of settlement paid to stop people lodging a claim in the first place. This information would need to be collected through interviews of a cross section of size and types of organisations in all sectors. Bigger businesses fare best because they can afford to pay people to go away rather than entering into the months’ of effort and toil involved in ‘fairly’ dealing with an underperformer, non attendee or bad behaviour. And see, for example, the Telegraph article from 3rd January about the £600,000 that the BBC forked out in the last year to settle claims, having had 33 of them.”
Finally, a resounding endorsement of her opinions comes in the form of a letter in today’s (5th January)Times from an ET judge of 22 years’ standing, who gives yet another level of analysis on how the system is not working as it is intended.
“What started as system of quick informal justice for workers at a time when there was no real protection from arbitrary dismissal has mushroomed into a bureaucratic and hideously complex quagmire of procedural and legalistic niceties, based partly on an enormous increase in statute law”
Helen Giles is Managing Director of Real People part of the Charity, Broadway Homelessness and Support. Real People’s award winning HR team delivers a comprehensive HR consultancy service.
www.broadwaysrealpeople.com
A newly published research report from PricewaterhouseCoopers (PwC)
states that the cost of replacing a competent employee equates to around a year of that individual’s yearly salary. They say that this is an estimation of the costs associated with lost productivity, lost skill and the cost of replacing and training new staff.
The report predicts that UK businesses are losing around £42 billion each year due to lost talent and that the UK trails other economies in terms of staff retention levels (UK 10.4%, US 7%, Germany and France 5%)
Richard Phelps, Human Resources Services Partner PwC comments: “With many companies eager to maintain or grow staff levels as the economy starts to recover, it is crucial they consider the full costs of losing staff through resignation. The need is particularly pressing given that many employees who sat tight during the downturn may now be looking for new opportunities elsewhere”
Investment now on positive employee engagement and promoting your employer brand will clearly have an impact on your longer term retention levels with the potential to achieve significant savings. Here at 360 Degrees Advertising we are working with a number of clients on developing their Employer Brand and Employee Engagement strategies.
New agreement means a Midlands office for 360
I am very pleased to announce that agreement has been reached to acquire the business of specialist education advertising and marketing agency – AdsFab, from its shareholders – the University of Warwick and the University Advertising Consortium. 360′s existing education business 360 Education will join with AdsFab’s business to form 360Adsfab, to become the leading advertising and marketing agency for the education sector, providing a range of services covering recruitment advertising, course marketing, student acquisition, employer engagement and brand development. Clients of the new Agency include, Imperial College London, University of Warwick, Durham University, Essex University and University of Hertfordshire among others.
Located at the University of Warwick Science Park, 360Adsfab will also provide a Midlands office for 360 Degrees Advertising, adding to our existing London and Thames Gateway locations. Clients seeking a Midlands resource now have the option of a local service provision, under the Direction of Agency Director Mike Pickering and his team.
The new Midlands office underlines 360′s commitment, in these challenging economic conditions, to deliver insightful, creative and cost effective advertising, marketing and communications solutions.
Our new Midland office address is: 360 Degrees Advertising, Agent Court, Sir William Lyon Road, Coventry CV4 7EZ. Tel: 0247 6573888
Roger Juniper, Chairman
What do I do now? This is the question on many graduate’s lips. Exams are well under way, perhaps over, for many of 2010’s finalists, yet the hard work is only just beginning. Many of this years graduate’s will be considering further education or a gap year due to a lack of jobs and a lack of guidance on how to find them.
Before graduation, a student’s life is focused on obtaining the best degree possible. However, recently it has come to light that having a good degree is not all you need to achieve a good job. With so many people graduating from university, a degree is almost becoming worthless. Now experience has also become very important, along with having a ‘unique’ quality to set you out from the standard Joe Blogs.
 Graduation day Many graduates will have never had a clear idea of what career path they want to take. Being sociable, hard working and intelligent many young people can feel potentially valuable to many different companies and industries. However, on graduating it can be extremely difficult to even secure a job interview. The real problem is where to begin? What is important to a graduate looking for a job?
A good wage is obviously very important. With debts often over £20,000, a scheme offering a quick fix to money problems is invaluable. Job security is another crucial factor when looking for a first time employer. Companies with a reputable name are often used extensively on graduate job sites and are more likely to attract ambitious finalists. Obviously benefits and potential to advance within the company or industry are very important to new graduates looking for their first job. As when finding a first house or choosing a potential partner, finding your first ‘real’ job is going to be a daunting and important decision.
Milkround, Targetjobs and Prospects are just a few examples of companies that aim to aid students in their quest of finding the perfect first job. They are extremely helpful, offering advice on CV writing, interview technique and how to best use personal skills, yet they still have a long way to go in attracting students to use their services. With so many possibilities for graduates, companies would benefit from joining graduate jobs fairs, to appeal to students whilst they are still studying their degree. An employee who really believes in a company and has worked specifically towards obtaining a job for such, is going to be an invaluable worker and likely to help the company achieve their future aims.
Of course, another potential way for companies to secure graduate interest would be to enter the domains frequented regularly by students. Social networking sites, such as Twitter and Facebook are the ideal examples. Sending an invitation to become a ‘fan’ of a company or to join a group, takes seconds to reach thousands and recruiting students to be ambassadors, especially if paid, has proven to be extremely successful in procuring student interest.
Students have young, vivid and vivacious minds and with so many school leavers going to university and obtaining a degree these days, it can only be beneficial to both employer and employee to work for, and with, someone that each truly believe in. Our new, naïve graduates need nourishment and guidance to achieve their full potential, but are employers really doing enough?
Tanya
As you have probably noticed the Argos brand has undergone a refresh in recent weeks. 360 got the go ahead to revamp Argoscareers.com just before Christmas and the new look careers website launched on time on Friday 22 January – the day before the new Argos catalogue launch featuring the new Argos branding for the first time.
We are currently working with the HR team at Argos on a complete overhaul of Argoscareers.com which will rolled out in the next few months.
David
 Gabby, Martin and Bella I’ve just returned, with two of my colleagues (Gabrielle Golding and Arabella Arthy) from the (FE) College Marketing Network Conference in Coventry. It was the first time I’ve been to an FE gathering, and you can’t help but be impressed with the enthusiasm and drive – and as the photo shows, we all worked very hard!
More seriously, it seemed to me that a key theme of the Conference was Employer Engagement, an area where I believe Colleges are, by and large, ahead of universities in terms of the importance they place on this area. Both financially and in terms of their mission, it is much more critical for them, but one wonders whether, given the way the political tide is flowing, HEIs might not find themselves having to play catch up before too long. Of course some universities, for example Warwick or Hertfordshire, have been fully engaged with the business community for a long time now, but that certainly isn’t true of the majority.
At 360, we’re putting the final touches to our Employment Engagement offering, and will, of course, be happy to discuss it in detail with interested parties in either sector.
Martin
Tweet. Twitter. Social networking. Mini-blogging. Updates. Even if you haven’t logged into the Twitter revolution yet, you’re bound to have heard people talking about it. And talking (in text of 140 characters or less) is what Twitter is all about. Communicating with a circle of friends (known as Followers) that you can manage – for example, you can follow someone, and they can follow you. If you are following them, you’ll see their Tweets, which are their short messages, which you can access online or have sent to your mobile, if they are following you they will see your updates, which you can write on the twitter site or via your phone/Blackberry. It’s a great way of communicating quickly and concisely to the people who matter. And, with TwitterJobSearch.com now up and running, it’s increasingly being used for recruitment communication purposes.
Join the conversation today. Follow us at twitter.com/360advertising.
Kirsty
We are delighted to announce that as of July 6th, Martin Bojam is joining 360 Education as Managing Partner. Martin was, until recently, Deputy Chairman of JWT Education, providing market research, brand development and marketing communications for education institutions of all kinds on a global basis, and is looking forward to building a similar practice at 360.
Martin has over 10 years experience in the education sector and works across the spectrum of British education, from universities, FE Colleges and business schools to independent schools and organisations such as the British Council. He has collaborated with many industry bodies such as CASE, NAFSA, EnglishUK and AMBA, and has spoken at many of their conferences, in the UK and elsewhere.
A graduate of LSE, Martin started his career in fmcg marketing before moving to work in a number of marketing and advertising agencies, specialising in strategically based solutions to communications problems. He has considerable experience in the market research and consultancy fields.
“I’m tremendously excited to be joining a group of highly experienced professionals, who really understand how to apply marketing thinking to real world problems. Education is my passion, and I am very confident that at 360 Education we have an immensely attractive offer for the sector, as it enters a period of unparalleled threats and opportunities.”
The new 360 Education website is live. You can view it at 360education.co.uk.
You’ll see there’s only a holding page there at the moment. This is because we wanted to start building a web presence for 360 Education as soon as possible but could not afford to wait until the whole website was designed and written. This holding page is actually the first live page of a complete website built using a CMS (Content Managed System).
This means that as soon as new content is ready we can start adding in extra pages ourselves – the CMS will allow us to add menus, sub menus and as many pages as we want.
David
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