Counting the cost of discrimination
The cost of litigation is always a concern for employers and never so more than in discrimination claims. Employers should never underestimate the cost and disruption a discrimination claim can give rise to. Discrimination claims are often complex and take more than a single day to be heard. On top of the legal costs involved in defending a claim, there are the hidden costs of absent managers who have to attend to give evidence and reputational damage to the business itself.
In order for employers to assess their attitude towards risk and what the approach should be to preventing discrimination in the workplace it is helpful to understand the consequences of getting it wrong. Compensation awarded in a discrimination claim is not subject to the statutory financial limit, which a standard unfair dismissal claim is subject to and is uncapped in relation to financial loss. Compensation may also include a separate award for injury to feelings; the amount awarded depends upon the severity of the case. The maximum award usually sits at £44,000 for the most serious of cases, with cases involving one off minor incidents achieving up from £900. Damages for personal injury can also be claimed as part of a discrimination claim; for employers who have been found to have acted in a high handed or oppressive way aggravated damages can be awarded.
This is not the end of the matter. Since 2014, the employment tribunal has the power to impose financial penalties on employers who lose in the following specified circumstances:
- where the employer’s breach has “one or more aggravating features“; and
- even if a financial award has not been made.
While there are as of yet no reported cases to illustrate how the employment tribunal will determine what amounts to “aggravating features”, what is clear is it will be for the tribunal to determine this taking into account factors it considers relevant including the circumstances of the case, the size of the employer, the duration of the breach of the employment right, and the behaviour of the employee and employer.
While the financial penalty regime has not been particularly successful, employers need to be aware of the regime bearing in mind it is open to an employment tribunal to impose the penalty.
The minimum penalty is £100 and the maximum £20,000. If a financial award has been made, the financial penalty must be 50% of the amount of the award (subject to the minimum and maximum caps). An employer will not have to pay the full penalty if it pays 50% of the penalty within 21 days. Employment tribunals will be required to take account of the employer’s ability to pay.
The penalty will be paid to the Secretary of State, who will pay the money into the Consolidated Fund (the government’s general bank account in the Bank of England).
Whilst financial penalties may be awarded in any type of claim, by their very nature discrimination claims are likely to present employment tribunals with the opportunity to issue the penalty.
No employer can prevent a disgruntled employee or ex-employee from pursuing a discrimination claim. Likewise, an employer does not want to have to pay a financial penalty to the government. Whilst settlement may be one option for resolving a workplace dispute if it arises, there are many measures that can be implemented to reduce the risk of the business having to take the full force of a successful claim. Zero tolerance on discrimination, bullying and harassment in the workplace, supported by clear consistently applied policies and procedures and training can go a long way to assist an employer to defeat a claim.
Human resources, business continuity and the coronavirus…What’s your “Plan B”?
If your people are a business-critical resource, a coronavirus epidemic could be a real threat to business continuity. While the spread of the virus cannot currently be stopped, should the situation become severe in the UK a contingency plan could make the difference between staying in business or having nothing to return to once the crisis is over.
The information below covers some of the main considerations that will help you identify your people-related risks and plan to mitigate the effect those risks may have on your business. The focus should be on creating a “Plan B” If there is a coronavirus epidemic in the UK.
Employees’ health and safety must be a priority, which should include:
- Ensuring that risks are monitored on an ongoing basis; any recommendations must be communicated and implemented as quickly as possible.
- Recognising that the risk of infection will also arise during a commute to work, a business trip or moving between sites. The duty of care may extend beyond the workplace and adjustments may need to be made to these arrangements.
- Complying with official guidance. The government, the NHS, Public Health England, the Foreign and Commonwealth Office are issuing information daily with the focus on curtailing the spread of the virus.
- Being alert to employees who may be more vulnerable to becoming seriously ill i.e., those who have an impaired immune system, are pregnant or are older. Additional protection and flexibility may be needed in these cases.
- Discouraging employees with coronavirus symptoms from attending work.
Employers are under a duty to ensure the health and safety of their employees and to provide a safe place and system of work.
Infection prevention and control
Practical considerations include:
- Alerting staff to the symptoms and risks of the coronavirus.
- Requiring sick employees to stay at home. Employers with a culture which discourages ill health absence may have to think again.
- Knowing what to do if someone is taken ill at work with suspected coronavirus. Following the official guidance about curtailment and hygiene is important.
- Reviewing overseas business travel before each trip to identify if travel is to an area classified as high-risk. Other considerations are whether travel insurance covers medical repatriation and the adequacy of local healthcare. Follow official advice to avoid putting employees at risk.
- Discouraging attendance at large gatherings whether on business or social outings.
- Introducing a return to work guideline to cover those who have travelled to at-risk areas for a holiday or business purposes.
- Requiring visitors to complete health/travel questionnaires to understand if they have been in contact with a person infected with coronavirus or have recently returned from an at-risk area.
- Encouraging good hygiene practices. Circulating information posters and bulletins is a good means of boosting compliance. Promoting regular handwashing with soap, the carrying and use of tissues and the use hand sanitising gel and antibacterial wipes is essential in limiting the spread of infection. Public Health England have published some useful posters which can be used.
- Investing in additional cleaning to ensure shared spaces and hard services such as phones, door handles and IT equipment are regularly disinfected.
Clear guidance will play a significant role in minimising the spread of the virus. Employees also have a duty to ensure that they do not endanger themselves or the health and safety of others.
Absences en masse
Key considerations if employees cannot or should not come into work are:
- Identifying key personnel and deciding how their absences would be managed.
- Reviewing or considering remote working practices for staff.
- Ensuring that adequate resources and controls are in place to support homeworking.
Not planning for people-related risks could have a detrimental effect on operational efficiency and difficult to address in the event of a pandemic.
Any effective plan will rely upon:
- Ensuring that there is a reliable and effective system for communicating with employees.
- Maintaining up to date contact data for employees, which is accessible remotely.
- Having individuals who are responsible for staff communications.
- Keeping employees up to date with developments.
- Implementing an emergency communication system and ensuring it is easily accessible and publicised.
- Ensuring all relevant stakeholders are included in any communications relating to the workforce i.e., employee representatives and trade unions.
The plan should be monitored and adapted to reflect official guidance as it develops in response to the spread of the coronavirus.
Review of HR policies and procedures
Key policies and procedures for review will include:
- Remote and home working – Would your rules have the flexibility and controls in place to manage alternative working arrangements away from work?
- Dependent care leave – Ensure that it is clear when employees can take time off to care for sick dependents. More time may be needed than usual to provide urgent care. Consider also what medical information is required before the employee is permitted to return to work.
- Absence management – Review any requirement that an employee must return to work as soon as they feel well. Instead, should a returning employee be required to provide medical guidance that they are no longer infectious?
- Sick pay – Review your current sick pay arrangements to understand what the maximum cost to the business could be in the event of an epidemic. Is it possible to mitigate these costs?
The aim of any review will be to understand if current practices are fit for purpose in the case of an epidemic. If practices need to be modified or suspended employees’ existing statutory and contractual rights need to be acknowledged when doing so. A failure to do so could potentially give rise to constructive unfair dismissal claims.
Prepare for disputes
Management needs to be prepared to deal with conflict which may include:
- A refusal to work due to health concerns. Employees need to proceed with caution given the special protection employees have when they raise concerns about health and safety or in whistleblowing cases.
- A refusal to go home where there is a health risk.
- Excessive leave or doubts over the genuineness of the illness.
- Where leave is unpaid.
- Where practices are applied inconsistently. This could give rise to complaints of discrimination or that there has been a breach of trust and confidence. For example, where some employees are paid discretionary sick pay and others are excluded or employees are targeted due to their apparent ethnicity or race.
Any conflict should be managed fairly and in accordance with the appropriate procedure.
While the outbreak of the coronavirus may not have same impact it is currently having elsewhere in the world. UK businesses cannot afford to ignore or underestimate the risk if there is a severe outbreak. In most cases, crisis management can be costly and have limited effect. Whereas planning ahead will ensure that you are ready for anything.
If having a “Plan B” is you preferred option, let FG Solicitors help you to identify the specific risks your business faces and build a strategy to mitigate the impact.