Managing Difficult Employees Workshop: Strategies and Legal Insights

1. Peter Forshaw Partner DDI: 0151 242 7935 peter.forshaw@weightmans.com Andy Halpin Solicitor DDI: 0151 242 6949 andy.halpin@weightmans.com Difficult Employees 10th November 2015

2. Learning objectives • By the end of the session the delegate will be able to: • Identify the types of ‘difficult behaviour’ commonly experienced in the workplace; • Appreciate the impact such behaviours can have on individual and fellow-staff morale, safety and productivity; • Understand the legal duties on both employers and staff in respect of their behaviour in the workplace; • Review the skills and strategies which can be deployed to tackle such behaviour, including tips on how to manage ‘difficult conversations’ and deploy internal policies and procedures effectively.

3. Agenda • What does ‘challenging behaviour’ look like? • Opportunities for intervention • Using Internal procedures effectively • Performance or conduct: Which route to take? • Any other options? • Tackling Multiple Grievances • Towards the Exit • ‘Protected’ Conversations • Negotiating Settlement • What will it cost?

4. ‘Challenging Behaviour’ • Failure to respond to reasonable requests and instructions • Demotivated and unproductive • Constant complaints/serial grievances • ‘Stirring’ discontent – encouraging other employees to raise claims? • Failure to ‘get-along’ with team/damaging team dynamic • Intimidating or upsetting team members • Saps management time and emotional energy

5. The impact on business • Management time • Morale of staff • Consistency of approach • Impact on clients and customers

6. Opportunities for Intervention • 1:2:1 Meetings • Team Meetings • Assert or reiterate behavioural standards • Facilitated meeting with line manager and HR? • Appraisals • Include contribution to/impact on team as criterion? • Avoids ‘difficult’ employee being singled out • Formal dispute resolution – e.g. mediation? • A formal internal process; conduct/capability?

7. Opportunities for Intervention Mediation • Independently facilitated process • Who should the mediator be? • Intense and concentrated focus on the problem (whole day or more) • Flexible: Mediator can adapt procedure to suit parties • Allows for ‘creative’ solutions • Confidential and without prejudice • Excellent success rate

8. Beware of Discrimination • If the employee ‘just doesn’t fit’ – Is there a reason? • Is there a root cause behind apparent poor performance? • Protected characteristics under the Equality Act? In particular consider: • Race/religion or belief? • Any religious/social/cultural factors that might inform employee’s behaviour? • Disability Discrimination • Any conditions that impede communication/social interaction?

9. Dismissal – The Legal Basics • Employment Rights Act 1996 – s98 • Five potentially fair dismissal reasons: • Conduct • Capability and qualifications • Redundancy • Breach of Statutory Restriction • Some other Substantial Reason (SOSR) • For employer to establish reason or principal reason

10. Using Internal Procedures Capability or Conduct? • Early and pro-active application of internal procedures is key • Can be difficult decision • Often Significant overlap – Skill vs Will • Choose at early stage and apply process rigorously • Don’t ‘muddle’ conduct and capability • Belief in ultimate dismissal reason must be ‘genuinely held’ - which process do you instinctively feel is appropriate? • Most important factor is that a fair procedure is followed

11. Applying Procedures Effectively Conduct – Some Key Considerations ACAS Code of Practice on Disciplinary Cases Employer must establish that: • conduct was the actual / principal reason for dismissal • it had reasonable grounds (evidence) upon which to believe that the employee was guilty of misconduct • it adopted a fair procedure (e.g. when gathering/reviewing the evidence, and giving the employee an opportunity to comment) • that it was reasonable in all the circumstances to dismiss • S98(4) – Nature of the business will be considered

12. Applying Procedures Effectively Conduct – Some key Considerations • Consider the employee’s existing disciplinary record • Previous warnings about unacceptable behaviour? • ‘Phased’ process more likely to be fair for persistent minor misconduct • Investigation • ‘Without unreasonable delay’ – ACAS Code • How much investigation is required? • Evidence and witnesses • Reluctant Witnesses • Third Party/Customer complaints

13. Applying Procedures Effectively Capability – Some Key Considerations • ACAS Code of Practice does not strictly apply – but may provide useful framework • Probationary Periods – Useful tool for ‘difficult’ individuals • Evidence is key: • Document appraisals and important conversations • What does the last appraisal say? • Have you offered appropriate support/training/behavioural feedback? • ‘Staged’ process with opportunity to improve most likely to be fair • Clear and measurable objectives

14. Any Other Options? • Reorganisation or restructure: • To place ‘difficult’ employee in redundancy position or lower profile role • Very drastic measure • Take legal advice – fraught with risk! • SOSR Dismissal: • Where employee behaviour genuinely does not fit into ‘performance’ or ‘conduct’ box

15. SOSR Dismissal • Approach with caution! • May potentially be suitable for: • Breakdown in trust and confidence • Reputational risk • Conflict of interest • Personality clashes • Other reasons that aren’t really ‘conduct’ and aren’t really ‘capability’ • Cite your specific reasoning • SOSR is not a ‘short-cut’ – Fair process must still be followed

16. Tackling Multiple Grievances – Do’s • Treat every grievance separately • Avoid forming an opinion based on ‘history’ • Document meetings and decision in detail • Make sure you comply with the ACAS Code of Practice • Avoid ‘truncated’ procedure except by agreement • Consider Mediation • Think creatively: What interventions might break the cycle? • Be very wary of victimisation • Woodhouse v North West Homes Ltd • Legally irrelevant whether allegations have merit • Think very carefully before alleging bad faithand or dismissing

17. Tackling Multiple Grievances: Don’ts • ‘Jump’ straight into formal grievance procedure • Would an informal conversation help? • Is answer clear from workplace policy? • Hear grievances regarding application of policies with ‘inbuilt’ appeals (e.g. conduct/attendance) • Re-open ‘old’ issues • Be distracted by ‘red-herrings’ • Allow employee to dictate the terms • Consider objections but ‘stick by’ your decisions

18. Termination by Settlement: Framework A ‘muddle’ of terminology! • ‘Without prejudice conversations’ : Long-standing rule • Pre-termination negotiations – Introduced 2013 • Compromise Agreements now ‘Settlement Agreements’ • Without prejudice principle still relevant?

19. Without Prejudice • Common law principle • Statements made in genuine attempt to settle existing dispute • Not admissible as evidence • Not protected if “unambiguous impropriety”

20. Pre –Termination Negotiations • Conversations about parting on mutually agreed terms. • Content of discussions will be inadmissible in ET proceedings • No existing dispute necessary • Improved freedom for frank discussions • Applicable to unfair dismissal claims only NOT discrimination • Protection lost if any ‘improper behaviour’ • Key requirements – ACAS Code of Practice

21. What is improper behaviour? • ‘Improper behaviour’ is a matter for the ET • Non-Exhaustive list of examples in ACAS Code of Practice • ‘Improper behaviour’ can include: • Harassment, bullying or intimidation • Offensive words or aggressive behaviour • Physical assault or the threat of physical assault • All forms of victimisation • Discrimination on the grounds of any protected characteristic • Putting ‘undue pressure’ on a party – e.g. insufficient time to consider offer

22. Pre-Termination Negotiations Exercise Caution! • Always bear in mind that confidentiality may be lifted by Tribunal even if you’ve stated ‘without prejudice’ or s111A conversation • Employee need only allege discrimination for confidentiality to be dis-applied • Don’t say anything you wouldn’t want ET to hear!

23. Having the Difficult Conversation • Plan meeting • Prepare what to say • Be fully aware of contents of offer and reasons • Introduce offer ‘gently’ – avoid ‘bolt from the blue’ • Consider possible responses/behaviours • Use appropriate questions • Listen actively • Check understanding, confirm next steps • Always have a Plan B! • What will you say if employee refuses?

24. Pre-Termination Negotiations: ‘Step by Step’ • Step 1: Approach employee to discuss issue • E.g. performance, conduct, employee appears unhappy etc. • Explain you would like to explore exit on agreed terms • Explain that, where appropriate, the alternative is commencing a formal process • Step 2: Is Employee interested in settlement? • Yes – Offer formal written terms • No – Explanatory letter offering opportunity to reconsider

25. Pre–Termination Negotiations: ‘Step by Step’ • Step 3: Time to think • Employer must have ‘reasonable period’ to consider offer • ACAS Code of Practice suggests at least 10 days • Step 4: Does Employee wish to Accept? • If No: Back off! Trigger formal procedure if appropriate

26. Pre–Termination Negotiations: ‘Step by Step’ • Step 5: Settlement Agreement • If Employee wishes to proceed provide ‘settlement agreement’ documenting the terms • Seek legal advice to draw up/review agreement • Employee must take independent legal advice on implications of signing • Step 6: Move on in confidence? • If no ‘improper behaviour or allegation of discrimination content of conversation cannot be raised at ET in event employee does not sign settlement agreement

27. At Tribunal: What will it cost? • Cap on compensatory award for Unfair Dismissal – 52 weeks gross pay • ‘Overall’ cap of £78,335 • Basic award in addition: • Calculated like a statutory redundancy payment; • £14,250 maximum based on £475 week’s pay • Uncapped award where dismissal discriminatory • Median award for Unfair Dismissal as at June 2015 – circa £6,955

28. At Tribunal: What will it cost? Other costs to consider • Costs can now be awarded against Respondents • Costs of conduct of the claim • Financial Penalties for losing employers A Pragmatic Approach? • Cap on compensation and low median awards may make ‘pragmatic’ approach worthwhile • Fewer claims…or just a greater likelihood of other claims like discrimination or whistle-blowing?

29. Contact Details Andy Halpin Solicitor DDI: 0151 242 6949 andy.halpin@weightmans.com Follow the Weightmans Employment Team on Social Media: Twitter: @Weightmans_Empl LinkedIn: Weightmans Employment

30. Learning objectives • Identify the types of ‘difficult behaviour’ commonly experienced in the workplace; • Appreciate the impact such behaviours can have on individual and fellow-staff morale, safety and productivity; • Understand the legal duties on both employers and staff in respect of their behaviour in the workplace; • Review the skills and strategies which can be deployed to tackle such behaviour, including tips on how to manage ‘difficult conversations’ and deploy internal policies and procedures effectively.