With employment tribunals having the potential to cost businesses over £100,000 per case, it pays to be legally compliant when it comes to employment law.
Upon the determination of a successful Unfair Dismissal claim, the Tribunal Judge can award a financial sum. The financial sum is made up of two awards, a basic award and a compensatory award.
The basic award is calculated in accordance with age and length of service of the individual, similarly to that of statutory redundancy pay. The maximum basic award for unfair dismissal is £19,920.
A compensatory award can be awarded with the maximum compensatory award for unfair dismissal being £105,707 or 12 months’ salary, whichever is the lesser amount.
In cases that do not comply with the ACAS code of practice, there is also the ability for the Tribunal to increase any award by up to 25%.
In a discrimination matter, compensation is uncapped and therefore this can give rise to very high valued claims. A monetary award in a discrimination claim consists of loss of earnings which does not have the same limit as unfair dismissal cases and an injury to feelings payment. Injury to feelings is measured by way of a Vento band and the current rates for this are £1100 – £11,200 for low band, £11,201 – £33,700 for mid band and £33,701 – £56,200 for the most serious cases. For the most exceptional cases they are capable of exceeding the £56,200 threshold.
As you can see, a claim can cost your business a large amount of money and therefore it is so important to take steps to eliminate any risk.
To ensure that your business is legally compliant, we have listed some top tips to ensure that these sorts of claims are prevented before they occur.
Find the right person for the right position. Some tribunal cases are brought in by people who don’t make it past the interview stage, so don’t ask discriminatory questions, such as questions to female interviewees about starting a family. Our best advice is to limit small talk to as little as possible. Small talk will place you at a risk without you even realising.
Inductions are required.
It’s important to start off on the right footing. Induct your new staff into the company and the position. Best practice is to allow them to meet people around the business, encourage them to go to someone senior for advice, encourage them to bring their own ideas to the table and tell them what the policies and procedures are.
Ensure that the correct policies and procedures are in place.
A new member of staff should have their contract of employment either before they commence work or one their first day of employment. Make sure that they know their rights and responsibilities and keep policies up to date by reviewing them regularly.
Know your own procedures.
It is important to make sure that you know your own procedures and follow them accordingly. Failure to follow your own procedures won’t sit well in Tribunal.
Keep staff trained.
Ensure that staff are kept up to date with procedures within the Company and aware of the expectations placed upon them.
This is a good opportunity to discuss your employee’s development and/or any issues affecting their performance or that of the team. It is a genuine opportunity to spend time appraising them and to keep records of any actions agreed in the meeting for both the employee and their manager. Employees who are appraised tend to be more productive and have higher morale. An appraisal is positive for both parties as it gives the opportunity for issues to be raised at an early stage without the need for them to escalate further.
Be approachable and proactive.
Ensure that your managers are approachable so that staff feel that they can raise issues with their manager. If a manager see’s an issue whether that be bullying, victimisation, discrimination etc – don’t wait for it to escalate. Nip it in the bud as soon as you can.
Do not allow it to get to the stage where an employee leaves and you don’t know why. Carry out exit interviews with anyone who leaves the business; these meetings are frank discussions about the reasons why the employee is leaving. Use the feedback gained to make positive changes around the business if there are any areas for concern and act upon any issues that arise as a result of this particular individual leaving.
Seek legal advice.
At Martin Kaye Solicitors, there is a team of dedicated employment law specialists who can help you prevent claims of this nature before they occur. If you would like to discuss further, please contact 0845 450 1561.