Friday, 18 October 2013

Behind closed doors...

Details of disciplinary action in the workplace must stay behind closed doors, a leading legal expert has warned.

John Mehtam leads our employment law team at Martin-Kaye Solicitors, in Telford and Wolverhampton, and he said employers must be extremely careful in order not to reveal any confidential information.

“It doesn’t matter how well you train your staff, things can and do go wrong, and when this happens, the directors must tread very gently. A complaint from an important customer is not good news for anyone, and if you don’t intervene, you could lose their business altogether.

“But equally, your staff are entitled to their privacy, even if you do take disciplinary action, and you should never reveal the outcome of any decisions you make.”

John said directors must never refer directly to what’s gone on behind closed doors, nor must they even drop hints to the client as to what action was taken.

“If you do slip up, and the employee finds out, they could resign and claim constructive dismissal for breach of trust and confidence, and report you to the Information Commissioner’s Office.”

John said often though a client’s complaint came with a demand to know exactly what the company planned to do about the situation.“This of course puts you in a very difficult position, and the best course of action is to acknowledge their complaint, apologise if it’s appropriate and tell them you will investigate the matter fully.

“Once the process is complete, you can give them a generic reply to say the company has reviewed its procedures and ensured staff are properly trained to follow them, but stop short of mentioning any disciplinary action.

“You can’t tell them if the employee has been sacked either – even though they no longer work for your company, you still have to respect the rules.”

John said there was one exception to the confidentiality clause, and that was if the company needed the client’s help with the investigation, maybe requiring a witness statement from them. “In these circumstances, you’ll obviously have to put them in the picture, but you must stress that they need to keep everything under wraps, and you must never disclose the final outcome to them unless you have the employee’s permission.”

Friday, 11 October 2013

Think before you speak - or face the consequences

Staff who bad mouth their employer or the company they work for could face the sack, according to our employment law specialist.

But shockingly, if the remarks were made in a private setting, they could escape disciplinary action, no matter how derogatory their comments were.

John Mehtam said the immediate reaction would obviously be for directors to step in and discipline the employee. “But this situation needs to be handled sensitively, despite how angry an employer may feel at the time. We’re all guilty of talking down our job after a particularly tough day, but how can you tell when an employee has crossed the line?

“First you have to establish that the person passing on the comments is telling the truth – and not only do you need to find out what was said, you need to know the context of where the remarks were made.

“This is because comments made in private, perhaps between a husband and wife in their own home, are none of the directors’ business, even if the comments are terrible. But if they’re made in public, it’s a different matter. It’s easy to blur the two situations though – a conversation between two workmates in the pub, depending on the facts, could fall into either camp.”

John said if the comments were directed towards an existing or potential client, it would be hard for the employee to argue it was a private conversation.

“Before you step in, if the comments were made in public, you need to find out from anyone who was present just how bad the remarks were. Was it just a moaning session at the end of a difficult day, or a malicious and calculated attack on your company and its reputation?

“This will be the key as to whether formal disciplinary action is necessary. If the employee apologises quickly for their actions (to you and everyone else involved), then it’s unlikely sacking them could ever be justified. And even if it’s just a grumble, giving the employee a written warning is sure to discourage them from making similar mistakes ever again.”

Tuesday, 8 October 2013

Property scheme is not all good news

One of our partners has hit out at a new scheme designed to help first time buyers get their foot on the property ladder. Nita Patel is head of the property team at our headquarters in Euston Way, Telford.

She said the news that the Government had brought forward the launch date for the Help to Buy scheme had been welcomed by many people as it would not only help first time buyers, but also people looking to move up the property ladder.

“Initially it had been planned to launch the scheme in January 2014, but the launch was brought forward which has been declared a positive move by many. But although the scheme will help buyers to purchase a property with as little as five per cent deposit, it’s clear that it just hasn’t been thought through as well as it could have been.”

Nita said the concept of the scheme was good, as at a time when the property market was recovering first-time buyers needed all the help they could get.

“It’s a great idea to help first-time buyers who don’t have rich parents to help them with their deposit so that they can buy a new home. But it fails to tackle the real problem, which is a lack of house building across the UK.

“The scheme will inflate house prices even more, which will just make properties even more unaffordable for generations to come. And another issue is that solicitors will probably have to charge additional fees for dealing with the extra paperwork that will be created as a result of the changes.

“I believe it’s maybe been created as a quick-fix and that it’s been developed so that the Government is seen to be doing something to help struggling first-time buyers. It would have been better to delay the launch as they had originally planned in order to iron out some of these issues and to pin down the finer details of the scheme before it was opened to the public.”

The Help to Buy scheme applies to all properties up to a value of £600,000, and involves the Government making a loan of up to 20 per cent of the cost of the new-build home. Buyers can then secure a deal with a deposit of as little as five per cent, and a 75 per cent mortgage to make up the rest of the cost.

Friday, 4 October 2013

Lawyer gives a stern reminder

A £13,000 bill handed out to office equipment giant Lyreco is a stern reminder of the dangers of failing to follow correct human resources practices, our employment law expert has claimed.

John Mehtam, from Martin-Kaye Solicitors in Telford, was commenting on the case brought against Lyreco by field sales representative David Atkin.

Mr Atkin, a member of the GMB union, was awarded the five-figure sum after winning his case for unfair dismissal against the company, which has an office in Telford, after being fired by his regional sales manager.

The judge said the disciplinary process leading to Mr Atkin’s dismissal was “at worst a sham, but at best lacked any form of investigation or analysis”.

John said:  “The judge also said it demonstrated practices which any human resources manager should quite frankly be ashamed of, and said the appeal was not worthy of the name.

“It is a very stern reminder to Shropshire companies that, if they do not have a proper infrastructure in place for dealing effectively with disciplinary matters, they could end up paying a stiff financial penalty.

“In particular, companies need to ensure they carry out a fair and thorough investigation into any staff disciplinary issues, apply a fair procedure, and under no circumstances must they pre-determine any disciplinary hearing.”

He said: “In Mr Atkin’s case, the judge clearly said that his regional sales manager did not approach the appeal with an open mind, and appeared to be partisan and biased.

“Employers who disregard these principles do so at their peril. They can face very serious sanctions including a rise in the compensation level awarded by the tribunal, and some very damaging, adverse publicity. This Lyreco case is an excellent example where the tribunal essentially lambasted the company for shortcomings in its disciplinary process.”

Tuesday, 1 October 2013

Warm welcome in Wolverhampton

We'd like to thank everyone who attended the VIP launch of our new Wolverhampton office - it was an excellent evening and we really appreciate the support shown by other businesses in the area.

Here's a flavour of the evening and some of the guests who attended.

Hefty bills could hit hard

Company bosses who personally own their commercial premises could be landed with a hefty income tax bill if improvements are made, a leading legal expert claims.

“Owning your company’s trading premises can be tax efficient, but there are also drawbacks too,” said Stuart Haynes, from the commercial team at Martin-Kaye Solicitors in Telford and Wolverhampton.

“When you gain a financial advantage from the arrangement, even if this is the side-effect of a genuine business transaction, you will be hit with a tax bill under the ‘benefits in kind’ rules. This can happen in particular if you allow your company to use your property rent-free, and it spends money improving it.”

With a growing number of companies working from home-based premises, Stuart said this was becoming an increasingly important issue to consider.

He said: “There are solutions. For example, if you intend to create a home workspace by perhaps converting a loft into an office, you could grant your company a lease over this, so that it can pay for the work.

“You won’t then be taxed on this benefit in kind immediately – only when the lease expires. Bear in mind, though, that this only works with a lease. A rental agreement will not do.

“And drafting a lease agreement is a job for a lawyer, so make sure you get expert advice.”