In business, your employees are one of your most important assets, it pays therefore to keep them happy and fulfilled in their work. But, despite your best efforts, sometimes things will go awry.
In this episode
In this 25-minute episode of Essential Business Radio, first broadcast in 2012 but still very relevant, we talk to experts Paul Bonnett, founder and owner of Bonnett’s Estate Agency, Rebecca Thornley-Gibson, partner at ASB Law and Matthew Penfold, senior adviser at Acas, about dealing with disgruntled employees (relates mainly to UK.)
Listen now (and please forgive the car engine revving in the background for the first two minutes of Paul Bonnet speaking!):
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About today’s guests
Julie Stanford: Hello, this is Julie Stanford of Essential Business Radio. A few years ago, I was very lucky to present a show called “Business as Usual” for Radio Reverb in Brighton, and I believe that a number of those shows are still very useful and relevant today. In business, your employees are one of your most important assets. It pays, therefore, to keep them happy and fulfilled in their work. Despite your best efforts, sometimes things will go awry. In this episode, I ask my guests Matt Penfold of Acas, Paul Bonnett of Bonnett’s Estate Agency, and Rebecca Thornley-Gibson of ASB Law,“How can you deal with disgruntled employees?”
Welcome to the three of you. We talked last week, didn’t we, how crucial prevention is when it comes to employment practice. You need to be aware that so many things that can go wrong could be prevented if you only thought about it in advance … When you’re taking on an employee, when you’re putting together all the right written particulars, and contracts, and such like. Really, what I wanted to talk about this week was when it goes wrong.
Coping when things go wrong
For some people, it does go wrong. I think more and more, employers are frightened that it is going to go wrong, and so possibly are behaving in their businesses in a way that they might not normally have done. They’re running scared because they’re thinking that any moment now an employee is going to take them to a tribunal. I wondered really Paul, as an employer of many years, have you ever had a problem with an employee?
Paul Bonnett: I’ve had one problem where someone actually went to … where we received a solicitor’s letter from an ex-employee charging us with constructive dismissal. We wrote back to that firm a solicitors explaining the history of the relationship with that employee, and how we’d explained what was happening very clearly to them, and there really wasn’t any case to answer. We’d been very clear about what the terms and conditions of the new post were, and that we couldn’t understand why they would’ve done this. We didn’t hear anything more from the employee, or from the solicitor.
Only a few years later, I did actually hear that the employee was very upset that they’d done this. I think they’d done it in an emotional moment after they left us. When they looked at it in the future, with hindsight, they thought, “Actually, it was nothing to do with Bonnett’s, it was actually my own situation”.
Julie Stanford: That must have been, for you, a moment of great relief.
Paul Bonnett: Yes, that was, when we didn’t hear back from the solicitors. Also, it was a great relief to believe that the person finally realized that we had done nothing wrong, that we’d been absolutely clear about everything. That was very good to know.
Julie Stanford: I think, Rebecca, you said last week that most employers are really trying to do it properly. I suppose I’m the ‘Polyanna’ of business. I will warn you all, I do have a bit of a rosy view of businesses. Hit me if I’m wrong, but I would think that most businesses start out trying to do it reasonably well.
Rebecca Thornley-Gibson: They do. Actually, sometimes a frustration of mine and my colleagues is that businesses are trying to do things so well and be so tolerant that they’re actually inactive in progressing matters with employees. You can go too far down the risk management scale, I think, in not taking action. That can have consequences for other employees who see that you’re not taking action, who then start to think, “Oh, well, perhaps I’ll act like that as well.”
Julie Stanford: Yeah, so … Which is what we’re really thinking is, because people don’t really know, employers don’t really know the law, they’re not entirely sure, so therefore they’re nervous. They’re sort of slightly running scared, really. Matt, what would you say to that? Is that your experience? Sometimes we get into trouble because people are just not understanding?
Matthew Penfold: Yeah, I think that ignorance, in a very positive sense of the word … Employers simply not knowing because of the amount of employment law that’s out there. Employers not knowing, perhaps, the rights and wrongs of what they can and can’t do, if they believe an employee has gone off the straight and narrow, leads to bigger and bigger problems. I would urge employers that find themselves in that situation where they think they ought to be doing something, pick up the phone and get advice from one of the resources that they’ve got available to them.
I’ll speak for Acas, and Rebecca will speak for the legal profession. There are people out there that you can turn to, usually not for earth-shattering amounts of money. The Acas Helpline, for example, is free. You can phone up, set a scenario out to an independent advisor, and they will give you some advice. The worst thing you can do, I’d agree with Rebecca, is just let poor performance run on unchecked.
Getting the balance right
Julie Stanford: Paul, do you think your knowledge, or lack of knowledge, I don’t know. Obviously, I clearly don’t know how much you know about employment legislation. Do you think you have behaved differently, sometimes, because you’ve thought that there may have been legislation in place which would affect your decision?
Paul Bonnett: Yeah, I think so. Sometimes you’re quite cautious about … Say, if you think someone might require, say, a verbal warning. You’re not really sure quite how far they’ve gone down the line to require a verbal warning. You sort of think, “Well, actually, if we just let it settle for a day or two, maybe it will be okay. Then we’ll talk about it again, and just have a discussion. Don’t give a verbal warning.”
In other words, have a bit of an appraisal of what happened, rather than turn it into a confrontational situation. Therefore, you keep their trust and their faith. If you can do that, you will then tend to have an employee with good morale. Whereas, obviously, once you have to do something like start giving people warnings, you can sometimes be on a slope towards the fact that they’re going to leave you quite soon, either in a bad way, or maybe in a good way for them and a bad way for you, or bad for both of you.
I’m very, very keen to try and stay away from jumping back at someone too quickly. In the old days, you’d have probably said … I know with the way my boss was with me 25 years ago, Crikey. He’d probably be hung, drawn, and quartered over the way he treated his staff. It’s a completely different affair now.
Julie Stanford: Yes.
Matthew Penfold: Yeah, and I hear exactly what Paul is saying there, and I can understand the situation that he’s talking about. A lot of employers find themselves in that situation. There’s a very fine balancing act between upsetting an otherwise good employee, and drawing their attention to some poor performance. I guess, really, it’s only the employer that can decide how that balancing act should end.
Last week, we were talking about recruiting the right people, and having policies and procedures in place … Ideally, having consulted with employees so that they understand what’s required of them. I know that this week we’re talking about when things have actually gone wrong, but Acas is a great believer in the ‘nipping it in the bud’ type conversation, the improvement conversation, which is short of any kind of formal warning.
This is where we’re merely bringing to somebody’s attention the fact that the expected standard isn’t being achieved, and enquiring, really, as to whether or not there’s any reason for that … Anything maybe we can put in place as an employer to help that standard be achieved, and hope, beyond all hope, that that’s enough to put people back on the straight and narrow.
Julie Stanford: Rebecca, what would you be saying about that?
Rebecca Thornley-Gibson: Well, I’d go back to the Acas guidance, in respect to disciplinary matters, where it’s actually clearly stated that a quiet word is often all it takes. I think that phrase needs to be borne in mind by employers, in that a quiet word isn’t a get-out, but a quiet word will often nip it in the bud. It will often make the employee realize the behavior, if it’s a conduct type issue has been noted. It will make sure that if there has been a slip, perhaps, in performance, that the employee needs to get back on track pretty quickly before formal action does start. I think those three words, ‘A quiet word,’ really ought to be at the forefront of employers’ minds, in that that is what they are being encouraged to do.
Julie Stanford: Paul, what would you …
Paul Bonnett: Yeah, one of the things that’s happening a little bit in a lot of companies now is not poor performance, but stress. A lot of people are quite stressed, because they’re worried about the fact that maybe the business isn’t earning the money it needs to do to pay them as well it would like to. They were having to work harder because the business has, maybe, had to make people redundant, so they’re doing the work of one and a quarter, or one and a half, or two people. They obviously feel under pressure. At the same time, the needs of the business mean that you can’t actually employ three or four more people, otherwise you would. You get people who get stressed.
Also, in a small business, which a lot of businesses are, people know each other very well. Consequently, their conversations and relations … Their sort of conversations between each other, can sometimes be the kind of conversations you would never get in a large corporate environment where people are very … They watch their Ps and Qs, always very careful what they say to each other. Whereas, in a small business, people’s emotions come out. Sometimes that can be quite negative where people are under a lot of pressure. Those people, you can understand the pressure they’re under, because you know it. You’re living in it yourself as well. Maybe they’re under a bit more pressure than others.
How do you deal with that kind of situation where you don’t … Where you say, “Actually, that was a bit inappropriate because you were over-emotional in the way you spoke to someone.” They’ll go, “I’m not surprised I’m over-emotional. I’m stressed out. I’m working too hard.” It’s quite a difficult thing to handle.
Julie Stanford: Let’s ask the experts, Paul, shall we?
Paul Bonnett: Yes, let’s ask.
Helping employees cope with the day-to-day pressures
Julie Stanford: No pressure, either of you. Rebecca, how would you handle that? I think, when you’re talking there Paul, I’m thinking that so much of this comes from that tension, and I use that word really in its purest sense, as well … Between the employer and everything that they’re up against, and the stress they’ve got because of the nature of business at the moment, and this recession, and the employee who may not … They have, obviously, their own tensions, their own stresses, but they’re going to be different. There’s a point where they both meet. How do you handle that, Rebecca?
Rebecca Thornley-Gibson: Well, the employer’s got a duty to provide a safe working environment for all employees. If one employee is causing an issue because of their behavior, which is then stressing, potentially, other employees, then actually, the employer’s got a duty, a health and safety based duty, to deal with that. You may find that somebody does call in sick the next day, stressed, because of the atmosphere in the office, perhaps.
There is a duty on the employer to ensure that that safe working environment is mentally safe, as well as physically safe. That’s often forgotten by employers. Therefore, if nothing else, I think the employer can go to the employee that’s causing an issue, and actually say, “I’m doing this for the benefit of the other employees, as much as, perhaps, your benefit, to let you know that the perception of your behavior, the perception of your attitude at the moment, is that it is unreasonable” perhaps.
Julie Stanford: Matt, what would you … You, probably more than anyone around the table, have been in positions of that point where the different needs meet, of the employer and the employee.
Matthew Penfold: Yeah, hearing what Rebecca was saying there, I can almost … I would paraphrase there. What I’m hearing is open communication. Approaching an employee, and talking about the impact that their behavior may be having on others in an organisation, is maybe one of the few ways that you can approach a situation like that. Yes, we do have a duty of care towards all our employees. If somebody is upsetting the equilibrium, then they need to be told that that’s what’s happening.
I do appreciate that there will be sensitivities in doing that in a small organisation where everybody may be sitting in an office that’s, perhaps, 20 feet by 20 feet. It is difficult, I accept that. It’s a balancing act. What’s preferable? Do we want that person to upset their colleagues in the office? Are we willing to live with that, or is it easier to live with the difficult conversation that we may need to have with one of our members of staff?
We may be talking about a particular source of stress here, as well, this sort of recessionary stress that people have over job security. Now, how can you deal with that? There’s no magic wand you can wave and guarantee people their jobs. I don’t even think your employees would expect that much of you. Maybe, a step that most employers, all employers, can consider taking is being as open and honest about the business situation with their employees as they possibly can.
Paul Bonnett: Well, in a way, that’s the problem with a very open business, that you are very open about the finances of the business, how successful you’re being. You’re becoming more and more successful. We’re actually taking on a new member of staff in two weeks’ time. That will help, for instance, in our business, for everyone to feel more supported. At the same time, it’s a gamble in this market because we are in a recession. You need to do it. We’ve done it, partly, to give everyone more support. We know it’s going to cost. Obviously, it’s going to cost. It’s another salary
Julie Stanford: I think I’ve read somewhere that one of the biggest bugbears of employees against employers is the lack of communication. Clearly, it’s crucial. I just would also like to take it forward now to this, “We’re not communicating well. Something has gone wrong. We’ve had the letter, which … “ Thankfully, Paul, you didn’t then … There was no followup on that.
Rebecca, you must really be in this position, because I bet there are employers ringing you because it has all gone wrong, or they’ve had that letter that Paul received. How do we deal with this, then? We’ve got a disgruntled employee, we’ve had the letter, we’ve been taken to a tribunal. How does this work? How can an employer, because we’re here, really, to talk from that perspective … What can an employer do? What’s open to them? What happens?
Dealing with an employement tribunal
Rebecca Thornley-Gibson: Right, well once you receive your employment tribunal claim, things have gone pretty wrong. Even though you may feel that you’ve got a very good defence to rebut the allegations, the problem is, is that you still have to deal with that tribunal claim. That will involve management time. That will involve potential reputational issues, which employers really don’t like. An employment tribunal is a public forum, so it’s never a particularly good strategy
Julie Stanford: It’s all the employment dirty washing out in public.
Rebecca Thornley-Gibson: It is, and dirty linen tends to get washed on day one of the tribunal when it’s reported by the papers. The papers don’t tend to report the real story at the end. It’s very difficult from a reputational issue. There’s the legal costs if lawyers do get involved. Obviously, if you lose, there’s compensation, financial compensation in the majority of cases. The problem is, you have to deal with it, though, as an employer. Whether you think you’re right and you can defend the matter, you have to deal with it. It can take some time, average tribunal cases for unfair dismissal, probably anything between six to nine months. You have that worry there.
I would say you deal robustly with the matter. You deal with it by complying with tribunal directions. If the tribunal has told you to disclose all relevant documents within a certain time frame, as an employer, you do that. If they’ve told you to prepare witness statements by a certain time, you do that. If you start messing the tribunal around, you become their enemy almost. You need to be the tribunal’s friend.
Julie Stanford: Are you innocent until proven guilty?
Rebecca Thornley-Gibson: You are, to a certain extent. Yes, you are. Yes, you are, or you certainly should be.
Julie Stanford: I was going to say you should be, really.
Rebecca Thornley-Gibson: As I said, the reputational issue, particularly internally, if people are aware an ex-colleague has brought a claim … does make life quite difficult, particularly if that ex-colleague is asking people who are still in the business to provide witness statements for their case.
Julie Stanford: Oh, I hadn’t thought about that. That’s terrible.
Rebecca Thornley-Gibson: That can be very difficult, and that can create all sorts of conflicts of loyalty. What I would say, though, is to try and give employers some degree of calm about this, though, is that last year there were 53,000 unfair dismissal cases that were brought in the tribunals. Of those, 33 per cent were withdrawn. They went nowhere. Thirty-three per cent were conciliated by Acas, so there may have been a financial settlement, or they might have been withdrawn on the basis that the employers, perhaps, not bring a cost order against them.
Julie Stanford: Is Matt our hero?
Rebecca Thornley-Gibson: Matt’s a hero for a third of those cases. Then, 13 per cent were actually successful at tribunal. That’s only 13 per cent of those cases that resulted in a finding against the employer. I think employers need to bear that in mind, that many of these cases don’t actually get anywhere, because they are withdrawn. There might be a nuisance settlement quite early on in the case that the employer decides to pay. Then, if only 13 percent actually result in an adverse finding against the employer, I think that shows employers aren’t doing too much wrong at the moment.
Julie Stanford: I’m very encouraged by those statistics, actually. You know what? We were talking last week about myths and realities … that flies in the face of that kind of sensationalist …
Paul Bonnett: Yes, the impression you get.
Julie Stanford: Yes, exactly so. Let’s think, then … We’ve heard how it can be. As you were talking there, Rebecca, I was thinking about all the poor employers’ time spent. I actually chaired a board for a charity, and they had one claim against them. I remember the time and effort that went into producing the information for the tribunal. As it was, it all came to nothing, but they spent hours, and hours, and hours of this charity’s time trying to get the information together.
Just thinking, Matt, from your perspective of a conciliation position, what would you wish employers had done before they got to that point, or to try and offset that happening in the first place? Although it’s encouraging that Rebecca’s saying only 13 per cent of them end up … From an employer’s perspective, it’s encouraging, that they end up having to pay out compensation. There’s still all the angst, and the work, and all of that awful upset that a tribunal is going to cause for all the other cases.
The conciliation perspective
Matthew Penfold: That’s what we’ve all, around the table here, got experience of. It’s not so much whether or not you are found, for want of a better phrase, guilty or not guilty by the employment tribunal. It’s the pain that it takes to get that far, or the pain that it takes to get to the nuisance settlement. The thing that I would urge employers to do is to try and find out what employees want to resolve a grievance before the employee gets to the point of actually wanting to put in a tribunal claim. Now, that relies, of course, on the employee raising the grievance with the employer. There is a requirement, now, on employees, to raise any complaint they may have about their employment rights with their employer, or any subsequent win that they may have at the employment tribunal could … The amount of money they may get could be reduced by 25 per cent, up to 25 per cent.
I would urge employers to seek resolutions that are outside of any court system. There are places you can go. Lawyers will offer compromise agreements which can negate any complaints to an employment tribunal. Acas itself offers a number of services. We have pre-claim conciliation, where if somebody believes that they have had an employment right breached, then they can approach Acas. If both parties are willing to talk voluntarily outside of the employment tribunal service, they can reach an agreement which will be binding, and which would negate any complaints to the employment tribunal on the agreed grounds.
Employers should consider whether or not an issue is maybe right for mediation. Whether or not an employee, perhaps, has a personality clash with another employee. How can you get that sorted out? Maybe one of them has to go, but maybe you could mediate a settlement. There are mediators available. Acas and other organisations have professional mediators.
If you’ve got to the point of having had an employment tribunal claim put in against you as an employer, then still, as we mentioned last week, Acas individual conciliators will have received a copy of those papers. They’ll make contact with both the employee and the employer and suggest, “Look, do you fancy settling this outside of court? What will it take?” That’s not always going to be about money and financial settlements. There are things that conciliator settlements can put on the table that tribunals won’t. Something as simple as, “I just wanted an apology.” Tribunals won’t give that. They won’t order that. A conciliator settlement could include that.
Julie Stanford: Paul, as an employer, what are you thinking as you’re hearing this from Matt?
Paul Bonnett: Well, one of the things I’m thinking is that if you’re communicating with your employees, and your employees are communicating with you all the time, these kind of scenarios don’t really happen. They happen very rarely because you realise what’s going on. You manage to turn things around between you. That’s what you can do. You’re always getting up and downs in business.
I would say, that, especially at the moment, businesses can be very fraught. If you continue to speak to your staff, and vice versa, and if there are issues coming up, you sort of thrash them out, basically. You can often get back to a situation where you go, “Yeah, that was yesterday, but it’s not like that today.” In other words, you can pull each other back from the brink, and find, actually, you really love working together. You just had a few things that have not been brilliant for a while, and that’s not unusual. Life’s like that as well. I think it’s communication is the art.
Julie Stanford: Rebecca, what are you thinking as you listen?
Rebecca Thornley-Gibson: Certainly communication is key. I find situations, though, sometimes, where employers become very entrenched in their views. It does become a ‘them and us’, a ‘who’s going to win this battle’. What seems reasonable to me as a potential settlement isn’t necessarily going to be reasonable to the employer who now sees it as a personal attack on them, particularly in a smaller business. Communication, in a vast majority of cases, will help but there are still those situations, and there always will be, it’s human nature, where it’s very entrenched and one party wants to win at the cost of an awful lot of other things.
We have to deal those sorts of things. Sometimes compromise agreements will work for those, as Matt said, whereby a sum of money will be given to the employee to waive their rights to take any tribunal claims. Sometimes the employer will refuse to give anything, and we’ll just wait for the employment tribunal claim to drop on their mat.
Julie Stanford: It’s such an enormous subject, and yet it’s been really very good of you, all three of you, to come along. This show was originally recorded for “Business as Usual” on Radio Reverb. I’m Julie Stanford. Thank you for listening to Essential Business Radio.