Monday, November 3, 2008

Exit Strategies

The Managing People conference last week, hosted by Directory of Social Change, was looking at the problems of why there are proportionately more Employment Tribunals hailing from our sector than any other. The answer, in short, was that we have a more `stroppy', rights-aware workforce who, if wronged, are quick to go to law. Coupled with this, we are not good, as a sector, at settling the matter with people before things go nuclear and you're staring at your former employee across a courtroom.

So what do we do about this? Although its probably unfashionable to turn to the private sector at this present moment, let's look, for a second, at what goes on here. Three big differences stand out about the best private firms. Firstly, they are better at the technicalities of employing people. Taking on staff these days carries liabilities which many TSOs just don't understand. Slipping through the ice is incredibily easy, as I did myself a few years ago when I got a `consultation period' wrong and ended up in a Tribunal. I, of course, never even knew I had to have one!

Secondly, the better firms are better at heading things off at the pass. Most Employment Tribunal situations arise because, somewhere along the way, things have gotten out hand. Emotions have risen and communication has quickly broken down. When this happens, TSOs, I have noticed, become paralysed, fearful of making contact in case this itsself opens up legal liabilities. I remember in one charity in which I was a trustee, where a dialogue was probably all that was required to settle matters. The charity remained ice-bound and ended up paying out £10,000 and being on the end of some harsh words from the Chair of the Tribunal.

Thirdly, private companies are, in my experience, much better at cutting a deal. Most of my friends work in private companies. In their world, there is a recognised financial cost for settling disputes which everyone understands, including the employees. This is because of the hassle of a Tribunal. People are willing to pay quite big money to avoid being put through the trouble. So quite simply, there is a `price' for resolution of disputes, dependent on the dispute and the industry. One bloke I spoke to confided that if he wants shut of somebody he knows he has to pay out £30k to the person involved. While forcing people out without due process isn't to be encouraged, it is worth considering that agreements which benefit everyone are probably something to be encouraged.

Given these lessons what can be applied in our sector?
1. Find a HR advice line. We should all make sure we have access to decent HR advice. This needn't be a lawyer or a member of our Board. There are now lots of HR advice lines which cost very little. We had one for years and although the advice is always very cautious, it means you don't get caught on the simple stuff.

2. Keep dialogue open. The instinct to freeze once someone mentions the word Employment Tribunal needs to be overcome. Dialogue before the lawyers get involved is the most likely route to resolution. Once you're in a legal dispute, you've lost, even if you go on to win because of the distraction it will cause you.

3. Cut deals. For a lot of people, a deal which allows them to leave with their dignity intact, three months' salary, a decent reference and a handshake is preferable to the stress and uncertainty they will face in a Tribunal. Most employees do not want to take a dispute public and realise the damage this can do to their CV. A deal which leaves them satisfied - even when you think you might win in a Tribunal is better than beating them in a public setting. By offering a resolution you are not admitting liability. You are simply setting out a better way forward for all parties. Though contact a lawyer to set you straight on just how to do this.

I have to say that when I think about it, were employing people in this country the risk it is now when I started business at Speaking Up I may have thought again about it. So far, I have had one Tribunal and settled with about ten others. In nearly all of these cases, I felt confident that we were on sure ground but I just didn't want the hassle. So I made a deal. Not the best way, perhaps, but it kept cost down and kept us out of the papers. And, of course, freed me to focus on the business in hand.

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