For business owners, employment law is a minefield with a vast amount of legislation and red tape to negotiate. And the whole area is made more complicated because it moves so fast: new policies, procedures, regulations and employee rights seem to appear every day.

By Craig McCracken, nexus solicitors.

Although it may seem daunting, a common sense approach and a clear plan is the first step. The following are key points to consider:

•    Structure

It’s important to properly consider what business structure – partnership, limited company etc - best suits your plans for the future and this will determine what kind of service agreements you need in place for directors and senior employees of the company.

These agreements will be more detailed than normal terms & conditions, and often contain clauses such as post termination restrictions, limiting a senior employee’s activities after they leave the company’s employment.

•    Policies, procedures and recruitment

Before recruiting staff you need to make sure you have key policies and procedures in place. The main areas to be wary of are Equal Opportunities policies (without which you will not have the statutory defence to claims of this nature against you).

Disciplinary/Grievance procedures which you are now legally required to have in place; and Terms & Conditions of employment, which you are obliged to provide to your employees within two months of the commencement of their employment. Advice should be taken to ensure that you cover all the relevant issues. 

These policies will also have an impact on recruitment because prospective employees have the right to bring proceedings if they feel they have been discriminated against in the recruitment process. Be careful with adverts, terms like “youthful enthusiasm” could trip you up.

•    Payroll

Give careful consideration to payment for overtime, and in particular any proposed bonus payments, which should be detailed in a separate bonus scheme document, ensuring you retain as much discretion as possible. .

•    Terms & conditions/staff handbooks

These are important documents and should be treated as such. There are legal minimums in relation to areas such as notice pay; statutory sick pay; maternity rights; parental rights; holiday entitlement; and minimum wage.

Your business will have to adhere to these, anything over and above the legal minimum is at the employers’ discretion. You should also think about issues such as probationary periods, which are advisable.

•    Discretionary benefits

Aside from the legal minimums many employers will offer employees a more attractive employment package and where this is the case you should ensure the details of these enhanced benefits are detailed in the employment documents.

The normal areas for consideration are enhanced sick pay; holiday entitlement; and notice requirements;

•    Data Protection

It’s important to be aware of the obligations of the Data Protection Act, in particular how employee information is stored; the employers rights to monitor an employees e-mails; and the employees rights to request various documents in their personnel file, from interview notes to appraisals etc.

You should always take advice to ensure the systems in place are not in breach of this legislation;

•    Management

Employers should ensure their managers are well trained and aware of the  company’s legal procedures. Careful attention should be paid to performance management; absence management; and the implementation of disciplinary/grievance procedures.

This is just a brief overview of the many issues entrepreneurs have to consider when setting up a new business. Our advice is to get good legal advice!

But also don’t be afraid to manage from an early stage, implementing, and relying upon the procedures in place, and always be conscious of the fact that an employee will acquire many more rights, such as the right to claim unfair dismissal, once they have been continuously employed for a period of 12 months.

Therefore, if action needs to be taken, such as performance related dismissals, it should be done in the employee’s probationary period, or failing this well in advance of their 12 months service being accrued.

www.nexussolicitors.co.uk

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By Craig McCracken  on   Jul 08,2008

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Keywords

employment law    management    people    data protection    payroll    recruitment   

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