FAQs for Executives

The following 10 FAQs set out the key employment law issues that arise for senior executives, directors and officers.

Please note that the questions and answers on this page are for general information only and must not be used as a substitute for legal advice. You should always take legal advice which is tailored to your specific circumstances.

1. I am being recruited from a senior position with my current  employer by a direct competitor.  How do I avoid legal pitfalls?

 

Answer

  • Ensure that you understand your legal position in relation to your current employer, especially regarding:
    • Duties of fidelity  and fiduciary duties 
    • Any express post-termination restrictions  in your contract/service agreement
    • Your notice period and any pay in lieu of notice (PILON) clause
    • Any garden leave provisions in your contract/service agreement
    • Use of confidential information, both during and after employment
    • Dealing with clients/customers and other business contacts both during and after employment
    • Dealing with fellow employees, both during and after employment.
    • Any bonus or incentive schemes, for example with regard to any good leaver/bad leaver provisions in stock option schemes or LTIPS.
  • This area is riddled with pitfalls for the unwary and we would suggest you take specialist legal advice. In particular:
    • Post-termination restrictions may or may not be legally enforceable. However, do not simply assume they are unenforceable.
    • Your full legal obligations to your current employer are unlikely to be fully  spelt out in your contract/service agreement. Implied duties can be very important in this kind of situation.
  • If you are subject to post-termination restrictions, you may be prevented from working for your new employer (or carrying out particular activities, such as dealing with particular clients/customers) for a period of time, even after your notice period has ended. You should discuss this with your legal adviser, well before resigning or accepting any offer. 
  • In some cases, it may be possible to negotiate some protection from the prospective new employer (for example, in the form of an indemnity) in relation to the risk of legal action against you by your current employer.
  • Consider how your resignation (and its timing) might affect your position, for example as regards any bonus or incentive schemes. If you stand to lose out, consider negotiating compensatory payments from your prospective new employer.
  • It is usually advisable not to disclose your proposed departure to your current employer until you have a full written job offer in your hands. You may wish to talk to your current employer at that stage, before accepting the offer. If your current employer is keen to keep you, they may be prepared to make a counter-offer.
  • With your legal adviser, carefully review the terms of the new job offer.
  • Assuming that you decide to resign, make sure you comply with any technical requirements in your current contract/service agreement, such as delivering notice in writing to the registered office of your employer in a particular way.  
  • If you are asked to carry out any work or other activities for your prospective new employer while you are still employed by the current employer, you should politely decline. This applies even if you are on garden leave and even the new employer  is not offering to pay you for the work. Otherwise, you may be in breach of your contractual and/or fiduciary duties to your current employer.
  • For the same reasons, while you are still employed by your current employer do not try to recruit people from your current employer for your new employer, or tip off the new employer about which of them to recruit. Be aware of any post-termination restrictions in this area which may be applicable for a period after your current employment has ended.
  • Similarly, do not retain or (even worse) pass on to your new employer any documents (in any form) containing confidential information relating to the current employer’s business.

 

2. An allegation of sexual harassment has been made against me by a junior female employee, A. I completely deny the allegation. How should I react?
 

Answer

  • Even if you believe that the allegation is completely groundless, you should take specialist legal advice.  The following suggestions are subject to the specific advice which you should receive, taking into account the particular circumstances.
  • For the purposes of deciding whether “harassment” (as defined in the equality legislation) took place, relevant factors include:
    • whether the conduct which is being complained about was “unwanted” by A;
    • whether, in the A’s perception, that conduct violated her dignity or otherwise caused an intimidating, hostile, degrading, humiliating or offensive environment for her;
    • whether her perception of the conduct was reasonable.
  • Although intent is also a potentially relevant factor, “harassment” can cover situations in which the accused person had no sexual or hostile intent towards the complainant. So, it is possible to sexually harass a person without being aware that you are doing so.
  • Find out as much as you can from your employer about the allegation, including details of time and place, who else (if anyone) is said to have been present and precisely what conduct on your part is said to have amounted to sexual harassment.
  • Prepare a written chronological note of the relevant events (in as much detail as you can) for your legal adviser.
  • It will usually be advisable to co-operate with your employer with regard to any internal investigation of the allegation. However, if there is any suggestion that your conduct may have amounted to a criminal offence, you should take legal advice on the extent (if any) to which you should co-operate.
  • As far as possible, avoid contact with A (particularly 1:1 contact) while the matter is being investigated. If you normally work closely with A, you should discuss with your employer practical ways in which contact can be minimised.
  • As far as possible, resist being suspended or being required to take leave of absence. If necessary (and subject to legal advice), consider offering to give formal  undertakings in relation to your conduct and/or contact with A during the period of the investigation.
  • Be completely open and honest with your legal adviser in relation to the circumstances surrounding the relevant events and anything else which could be taken into account, such as any previous occasions on which your conduct towards colleagues may have been questioned (or questionable), whether or not in relation to this particular complainant.
  • Identify any sources of evidence that could help to support your account of the relevant events. These may include:
    • witnesses.
    • documents, such as email or text exchanges; calendar or diary entries; and any notes which you or others may have made at or around the time of the relevant events.
    • phone records.
    • CCTV footage.
  • You and your legal adviser should ensure as far as possible that:
    • all such relevant evidence is taken into account in the internal investigation; and
    • the investigator appointed by the employer is a suitably experienced and impartial person.
  • Assuming that you are co-operating with the investigation, you will almost certainly be interviewed. You should consider asking if someone can accompany you to the interview, to assist you and to take a note. Your employer may not allow you to have a legal adviser present, but it is more likely that you will be allowed to be accompanied by a suitable colleague.
  • In advance of the interview, consider preparing a chronology of events for yourself (which you may also wish to provide to the investigator). Ensure as far as possible that you have copies of relevant evidence with you at the interview, so that you can highlight key points to the investigator.
  • Treat the investigator with respect.
  • Ask for a copy of the investigator’s note of the interview, so that you can review it and submit any necessary corrections or clarifications.
  • Assuming that you receive a copy of the investigator’s note, review it carefully with your legal adviser and promptly submit corrections or clarifications if appropriate.
  • Once the investigation has been carried out, you should receive a copy of the investigation report. Review it carefully with your legal adviser. If there are substantial findings against you which you believe are inaccurate or unwarranted, consider submitting objections.
  • If the conclusion of the investigation is that there is a case for you to answer in relation to sexual harassment, formal disciplinary proceedings  against you (up to and including dismissal) will almost certainly follow.
  • You may feel that you wish to resign at this point (or indeed any other point) or you may be offered a severance agreement by the employer. You should consider carefully with your legal adviser the likely impact of any such step on you and your future career prospects.
  • The conclusion of the investigation may be that there is no disciplinary case for you to answer in relation to sexual harassment, but that your conduct and/or judgement have fallen below the standards expected of someone in your position. In that situation, you may be asked to accept some form of guidance or training. You should not immediately rule this out, but should consider carefully with your legal adviser whether to agree to do so.
  • Even if there are no findings against you, that may not be the end of the road. There may be objections from A that the investigation has not been carried out properly, which could lead to further internal grievances and/or appeals.
  • If the situation is ultimately resolved in your favour, you should consider with your legal adviser and your employer how the situation will be dealt with for the future, particularly if A remains employed in a position close to yours.    

 

3. I am a female executive and have been subjected to sexual harassment by a more senior male colleague, B. What should I do?
 

Answer

  • The following suggestions are not intended to cover serious sexual offences (such as rape, attempted rape or sexual assault), in relation to which you should contact the police without delay.
  • In work-related situations falling short of serious sexual offences you should take specialist legal advice, as soon as possible.  The following suggestions are subject to the specific advice which you should receive, taking into account the particular circumstances.
  • For the purposes of deciding whether “harassment” (as defined in the equality legislation) took place, relevant factors include:
    • whether the conduct which you are complaining about was “unwanted” by you;
    • whether, in your perception, that conduct violated your dignity or otherwise caused an intimidating, hostile, degrading, humiliating or offensive environment for you;
    • whether your perception of the conduct was reasonable.
  • You should prepare a written chronological note of the relevant events (in as much detail as you can) for your legal adviser. You may well find this difficult. However, it will help you to obtain the best advice.
  • Be completely open and honest with your legal adviser in relation to the circumstances surrounding your complaint and anything else which could be relevant, such as any reasons why B might have thought that you condoned or encouraged his conduct.
  • Consider carefully with your legal adviser whether you wish to raise a complaint and, if so, how. The decision is entirely yours. However, your legal adviser should be able to help you to assess the situation.
  • It will usually be advisable to make your complaint through the employer’s formal internal procedures. There may a specific procedure for dealing with sexual harassment, or just a general grievance procedure, or in some cases no published procedure at all. Your legal adviser and/or your employer’s HR department should be able to help you navigate the process. 
  • You and your legal adviser should also keep a careful eye on the time limits applicable to Employment Tribunal claims for sex discrimination and harassment.  The general rule is that claims should be brought within 3 months of the relevant events (even if internal procedures are still ongoing), although there are potentially some exceptions and extensions.
  • It is often worth having an informal discussion with a senior HR person as an initial step, but do not allow yourself to be dissuaded, against your own carefully considered judgement,  from making a formal complaint.
  • If you make a formal complaint, it will be necessary for your employer carry out an investigation. This will involve your allegations being put to B (and possibly to other witnesses) and to you being identified as the complainant. It is not usually possible to maintain anonymity.
  • Identify any sources of evidence that could help to support your account of the relevant events. These may include:
    • witnesses.
    • documents, such as email or text exchanges; calendar or diary entries; and any notes which you or others may have made at or around the time of the relevant events.
    • phone records.
    • CCTV footage.
  • You and your legal adviser should ensure as far as possible that:
    • all such relevant evidence is taken into account in the internal investigation; and
    • the investigator appointed by the employer is a suitably experienced and impartial person.
  • As far as possible, avoid contact with B (particularly 1:1 contact) while the matter is being investigated. If you normally work closely with B, you should discuss with your employer practical ways in which contact can be minimised. You may argue that he should be suspended, but be aware that your employer may be reluctant to do so before any findings have been made.
  • You will almost certainly be interviewed by the investigator. You should consider asking if someone can accompany you to the interview, to assist you and to take a note. Your employer may not allow you to have a legal adviser present, but it is more likely that they will allow you to be accompanied by a suitable colleague.
  • In advance of the interview, if you have not already done so consider preparing a chronology of events for yourself (which you may also wish to provide to the investigator). Ensure as far as possible that you have copies of relevant evidence with you at the interview, so that you can highlight key points to the investigator.
  • Treat the investigator with respect.
  • Ask for a copy of the investigator’s note of the interview, so that you can review them and submit any necessary corrections or clarifications.
  • Assuming that you receive a copy of the investigator’s note, review it carefully with your legal adviser and promptly submit corrections or clarifications if appropriate.
  • Once the investigation has been carried out, you should receive a copy of the investigation report. Review it carefully with your legal adviser. If there are findings which you believe are inaccurate or unwarranted, consider submitting an appeal.
  • If the ultimate decision is not in your favour, you should consider with your legal adviser how to respond. Your options may include:
    • accepting the decision and remaining in employment;
    • remaining in employment and bringing sex discrimination/harassment proceedings in the Employment Tribunal against B and/or your employer;
    • resigning, in which case you may also wish to claim to have been constructively and unfairly dismissed.
  • Your employer may  approach you at this (or any other) stage with a suggestion that you may wish to leave under severance terms, subject to a settlement agreement. You should consult carefully with your legal adviser before responding to any such approach.
  • If the conclusion of the investigation is that there is a case for B to answer in relation to sexual harassment, formal disciplinary proceedings  against B (up to and including dismissal) will almost certainly be instigated. You may be required to give further evidence as part of any such disciplinary proceedings  against B.

 

4. I have discovered evidence of financial misconduct by senior colleagues, C and D, but I’m worried about the effect on my position if I report them. How should I deal with this?
 

answer

  • Take a step back and review all the evidence available to you, as objectively as possible. Avoid:
    • committing misconduct yourself, such as by searching for information which you are not authorised to access, or sending confidential documents to a personal email address in breach of your employer’s rules; and
    • engaging in a personal campaign against C and/or D. 
  • Having reviewed the position, if you believe that the information points towards serious misconduct such as a criminal offence (e.g. fraud) or breach of a legal obligation (e.g. a regulatory breach), take specialist legal advice. On a confidential basis, provide your legal adviser with written details of the information and the reasons for your belief. 
  • Even if the information disclosed by you turns out to be inaccurate, any report you make may still amount to a protected disclosure (often referred to as “whistleblowing”) under the public interest disclosure legislation. 
  • For example, if you mistakenly but reasonably believe that the information disclosed to your employer tends to show fraudulent activity or non-compliance with financial regulations, the disclosure is likely to be “protected”. 
  • Treating you detrimentally for making a protected disclosure (also known as victimisation) could lead to uncapped liabilities for your employer in the Employment Tribunal. Dismissing you for making the disclosure would be automatically unfair (and compensation would again be uncapped). 
  • There are potential liabilities not only for your employer, but also for individual colleagues involved in dealing with you in light of the disclosure.
  • Consider carefully with your legal adviser:
    • whether you have reasonable grounds to believe that the information tends to show misconduct;
    • the seriousness of the suspected misconduct;
    • whether disclosure would be in the public interest (rather than, for example, merely being part of an acrimonious spat between colleagues);
    • whether you have a regulatory or other duty to report your concerns, for example to a regulatory body;
    • the likely impact of disclosing the information to your employer;
    • your reasons for believing that your position may be at risk if you disclosed the information to your employer;
    • whether there are reasonable grounds to believe that evidence might be concealed or destroyed if you disclosed the information to the employer;
    • to which body or person you would disclose the information if not to your employer, for example a regulator or other authority.
    • whether your employer has a whistleblowing or public interest disclosure policy.
  • Your legal adviser should be able to provide you with guidance on whether you should make a disclosure about C and/or D’s conduct and, if so, how to do so in a way which reduces any risks for you as far as possible. 
  • In particular:
    • it is usually advisable to follow your employer’s whistleblowing or public interest disclosure policy;
    • anonymous disclosures can be risky, as it is sometimes inferred that they are malicious;
    • it is sometimes possible to make disclosures on a confidential basis to a neutral person either within or outside the organisation, to protect the disclosing party;
    • in practice, however, even if your involvement was initially kept confidential, in the event of disciplinary proceedings against C and/or D, it is likely that you would be called upon to be a witness;
    • any disclosure should focus on the relevant evidence that you have become aware of and your reasons for believing that it tends to show serious misconduct of the kind mentioned above;
    • conversely, allegations unsupported (or only loosely supported) by evidence should be avoided;
    • if relevant, you should consider whether to include your grounds for concern that you may be victimised or that evidence might be concealed or destroyed.
  • It is usually advisable to co-operate with any assessment and/or investigation which your employer may decide to carry out into the information you have disclosed. Together with your legal adviser, you should encourage your employer to appoint suitable and neutral people to carry out any such tasks. 
  • If your employer ultimately fails to take appropriate action in response to your disclosure, you should reassess the situation with your legal adviser. The options available to you may include:
    • taking the view that you have done as much as you can and ceasing to press for action to be taken;
    • considering career opportunities elsewhere;
    • escalating the disclosure, for example to a regulatory body or the police;
    • if there are grounds to believe you have been victimised, raising those issues through internal grievance procedures and/or external Employment Tribunal proceedings;
    • resigning on grounds of victimisation, in which case you may also wish to claim to have been constructively and unfairly dismissed.

 

5. I run a team operating a big contract for a client. We have lost the contract to a competitor. My employer, E, takes the view that TUPE will apply to transfer the whole team to the successful tenderer, F Ltd. However,  F Ltd claim that TUPE doesn’t apply because they are going to be operating the contract very differently and they already have all the employees they need. What should I do?
 

answer

  • TUPE (in its full glory, the Transfer of Undertakings (Protection of Employment) Regulations 2006) presides over one of the most difficult areas in employment law and practice. The following suggestions provide a condensed view and you should always seek specialist advice tailored to your specific situation.
  • F Ltd may (or may not!) be correct in their main argument that TUPE doesn’t apply because they are going to be operating the contract very differently (see below for more on this).  However, their argument that they already have all the employees they need is, from a legal perspective, not a good one – to put it politely.
  • The most likely (but not the only) way in which TUPE could operate to transfer the obligations and liabilities under the contracts of employment to F Ltd is through a so-called “service provision change”.
  • It is important to note that not all changes of contractor amount to a service provision change. 
  • Basically, a service provision change from one contractor to another under TUPE happens where:
    • an existing contractor carries out activities for a client and there is an organised grouping  of employees, the principal purpose of which is the carrying out of those activities – in other words, there is a team of employees which has been put together to provide the service to the client and which mainly exists to provide that service;
    • the client intends that the activities will be carried out by a new contractor;
    • the activities stop being carried out by the existing contractor on the client’s behalf and are carried out instead by the new contractor.
  • Service provision changes can also take place where the activities are carried out by the client in-house and are then contracted out; and conversely where they are contracted out and are then brought back in-house.
  • The main basic effects of a service provision change are:
    • to transfer the obligations and liabilities under the contracts of employment (including past liabilities) of all the employees who are included in the relevant “organised grouping”;
    • to render dismissals of employees by reason of the transfer automatically unfair (although there is some leeway for dismissals merely “connected with” the transfer);
    • to render changes to the contracts of employees by reason of the transfer void (although again there is some leeway for changes merely “connected with” the transfer).
  • If it can be shown that the activities carried out by F Ltd for the client are fundamentally or essentially the same as those carried out before the change, F Ltd’s argument will not succeed. Mere changes to the way those activities are organised or carried out are very unlikely to be found to change the fundamental nature of the activities themselves.
  • However, under the new contract F Ltd might (for example) cease some important aspects of the activities carried out for the client and/or add on substantial further activities. In that kind of situation, there is a risk that their argument could succeed. You (and/or your current employer) may not have sufficient information to  assess the extent of that risk.
  • As a group of employees, you should consider obtaining your own specialist legal advice on the position, splitting the costs between you on an agreed basis. Alternatively, in a unionised environment, it may be possible to obtain such advice through a trade union. 
  • If the two employers (your current employer and F Ltd) fail to reach agreement on whether TUPE applies, there is a serious risk that you and your colleagues may find yourselves having your employment terminated by your current employer without any redundancy payment or other compensation and without any continuing employment with F Ltd.
  • You and your colleagues would then be left with the prospect of taking Employment Tribunal proceedings against both employers, on the basis that one of them must be wrong. Ultimately, you would probably succeed against one of them, but the delay and costs involved would almost certainly mean that you would end up substantially out-of-pocket. 
  • A legal adviser well-versed in TUPE would be likely to encourage co-operation between the two employers (and their legal advisers) in the interests of reducing the risks and costs for all sides. This would involve disclosure of the proposals for the new contractual arrangements and a proper analysis of the applicability (or otherwise) of TUPE. 
  • In practice, this may not result in agreement being reached on whether or not TUPE applies. However, our experience is that it often concentrates the minds of the employers on the risks and costs for them. This enables a negotiated solution which protects or compensates the affected employees (in this case you and your colleagues) without having to go through long and costly Employment Tribunal proceedings.
  • Even in the worst case scenario (in which no negotiated solution is reached) you would as a result be much better prepared for Employment Tribunal proceedings than otherwise. This should lead to any such proceedings being shorter, less costly and more likely to succeed.

 

6. As a result of pressure both at work and at home, I’ve been diagnosed as suffering from severe clinical anxiety and depression. I have not told anyone at work. My employer claims I’m underperforming and is threatening to dismiss me. How should I respond?
 

answer

  • Your first priority in this kind of situation should be your health. You should obviously  ensure that you receive the best possible specialist medical advice and treatment.
  • However, your work is likely to be an important aspect of the situation. Cases like this are very fact-sensitive. You should take specialist legal advice tailored to your situation. Subject to that, we make suggestions below as to how you might deal with it from an employment perspective. The suggestions below do not deal with any personal injury issues, but you should also discuss any such issues with your legal adviser.
  • With the help of your legal adviser, you should try to establish your desired, but realistic, outcome from this (far from ideal) work situation. You should take into account all the relevant factors, for example:
    • the medical advice about your condition, the prospects for recovery and how long recovery is likely to take;
    • what help you would need from your employer to assist your recovery – for example,  a period of time off work, temporarily reduced responsibilities and/or more resources;
    • if your employment was to come to an end, what sort of financial cushion  you would need to recover and find suitable alternative work;
    • any relevant pension, ill health retirement or insurance schemes;
    • any issues at home that may affect the situation. 
  • It will usually be advisable to ensure that your employer is on notice of your medical condition and its current impact on your work. You may fear that this would make you look weak or that your employer will react badly. However, employers’ attitudes to mental illness are changing. In any event, attempting to deal with the situation without telling your employer about your condition would be likely to be difficult and would leave you more vulnerable to dismissal.
  • You may well have a disability, within the meaning of the disability discrimination legislation. If so, this potentially gives you additional legal protection in relation to your employment. However, if your employer does not know about it (and cannot reasonably be expected to know about it), that protection will not apply.
  • The legislation covers mental as well as physical disabilities. A disability is basically an impairment which has a long-term and substantially adverse effect on the person’s ability to carry out day-to-day activities.  Day-to-day activities include mental activities such as concentrating and making decisions.  A condition which lasts or recurs (or is expected to last or recur) for 12 months or more is viewed  as long-term.
  • It is important to note that disability discrimination potentially includes:
    • treating a person unfavourably because of something arising from their disability, such as reduced work performance or attendance problems which are due to the disability; and 
    • failing to make reasonable adjustments to avoid disability-related disadvantage at work, for example adjusting performance expectations or providing additional training or equipment. 
  • Compensation for disability discrimination (including discriminatory dismissal) is uncapped and depends largely on the losses suffered as a result. If you lost your job as a result of disability discrimination and were unable to find alternative employment for a considerable period of time, the level of compensation could potentially be high.
  • If you decide to inform your employer, you should carefully consider with your legal adviser how to go about it. It is usually advisable to put it in writing, in some detail, but also to meet with an appropriate senior person to discuss the position.
  • Your employer is likely to ask for medical evidence, either from your own medical advisers and/or by asking for you to be examined by a specialist of the employer’s choice. It is usually advisable to co-operate with your employer and/or its medical adviser. However, be aware that, in some cases their aim might be to gather evidence to show that:
    • you are not, in fact, disabled within the meaning of the disability discrimination legislation; and/or
    • if you are disabled, there are no adjustments (or no further adjustments) which the employer should reasonably be expected to make in your case; and/or
    • there is no reasonable prospect of you being able to return to work (either at all or at a reasonably  acceptable level of performance) in the foreseeable future, so that your employment should be terminated on ill health grounds.
  • In the light of your desired outcome (as discussed above) you should discuss with your legal adviser your strategy with regard to dealing with your employer and its medical adviser. For example:
    • if your desired outcome is to resume your existing role after a period of time for treatment and recovery, it may be advisable to emphasise the medical evidence about treatment and prospects of recovery after a period of time;
    • alternatively, if your desired outcome is to reach a severance agreement on reasonably favourable terms (so that you can leave and have a period of recovery at your own pace), it may be advisable to emphasise any failings on the part of the employer to make reasonable adjustments in respect of your disability. 
  • Your employer may seek to agree a programme with you under which you will be provided with support and adjustments and (if all goes according to plan) you can resume your full duties after a period of time. You should consider any such suggestions carefully with your legal adviser. Your approach to it is likely to depend on how reasonable (or otherwise) it is and the extent to which it is likely to fit with your desired outcome.
  • If your employer’s response to the situation is unreasonable, you should consider the position further with your legal adviser. Depending on the circumstances, the options available to you may include:
    • raising issues of disability discrimination through internal grievance procedures and/or external Employment Tribunal proceedings;
    • resigning on grounds of disability discrimination, in which case you may also wish to claim to have been constructively and unfairly dismissed;
    • simply resigning from your position so that you can focus on your recovery;
    • seeking to negotiate a severance agreement with your employer, to provide you with a sufficient financial cushion to enable you to recover and seek alternative employment.
  • In deciding on which course of action to take at any stage, you should remind yourself that your first priority in this kind of situation should be your health.

 

7. To help with child care arrangements at home, I want to  compress my full-time 5 day week into 4 days per week. How should I approach this?
 

answer

  • Employees with 26 weeks or more continuous service have the right to request a wide variety of changes to their working patterns (including hours and place of work). A request to compress 4 days’ hours into 5 would potentially come within this right.
  • There are procedural rules which we will not go into in detail  here. However, to come within the flexible working regulations, any request must:
    • be in writing.
    • be dated.
    • state that it is an application made under the statutory procedure.
    • specify the change that the employee is seeking and when they wish the change to take effect.
    • explain what effect, if any, the employee thinks the change would have on the employer and how any such effect could be dealt with.
    • state whether the employee has previously made an application to the employer and, if so, when.
  • Be aware that the employer can reject a request if the reason for the rejection comes within one or more of the following:
    • the burden of additional costs.
    • detrimental effect on ability to meet customer demand.
    • inability to reorganise work among existing staff.
    • inability to recruit additional staff.
    • detrimental impact on quality.
    • detrimental impact on performance.
    • insufficiency of work during the periods the employee proposes to work.
    • planned structural changes.
  • If you decide to make a request, you should consider whether your employer could  have grounds to reject it which are within the above list. You should frame your request so as to minimise its potential impact on any of the factors included in the list. This should  fit in to the section of the request dealing with the effect in the employer.
  • For example, if you are in a customer-facing role, your employer may have legitimate concerns about a potential detrimental effect on ability to meet customer demand. However, if you propose not to work on a day when customer demand is usually at its slackest and to work more hours on busier days, you may be able to allay any such concerns.
  • It is often advisable to include in your request a clear indication that you are prepared to be flexible in relation to the request itself and how it operates in practice. This should enable discussion between you and your employer, so that any concerns on either side can be addressed.
  • If your request is rejected, you should consider appealing. If the ultimate decision is to reject and there are grounds to believe that the reason for rejection does not comply with the regulations, you should consider bringing Employment Tribunal proceedings.
  • The potential liability in the Employment Tribunal under the flexible working regulations is small (up to 8 weeks’ pay, subject to the statutory cap on a week’s pay). In many cases, it may not be worth your while to bring Employment Tribunal proceedings, particularly after taking into account the likely damage to your relationship with your employer.
  • However (particularly if you believe that the employment relationship may already be beyond repair), you should also consider whether you may have any other claims which could piggy-back on a flexible working claim, such as a discrimination claim.
  • For example, if you are female you could consider bringing an indirect sex discrimination claim. This would be on the basis that a significantly greater proportion of women in the workplace have child care responsibilities and that the employer’s policy of refusing such requests puts female employees (and you in particular) at a particular disadvantage. 
  • As another example, if you are male and in the past your employer has granted a similar request in similar circumstances from a female employee, you could consider bringing a direct sex discrimination claim on that basis.
  • If your request is ultimately granted, we would recommend that you try to ensure that the new arrangements work well, from both your point of view and your employer’s. In granting any such request, employers often include an express provision under which the new arrangement can be kept under review. In any event, the new arrangement is unlikely to last long if it does not work for your employer as well as for you. 

 

8. My employer’s business is facing a major downturn. I’ve been told that the unit I run is likely to be closed and that the whole team faces redundancy, including me. What should I do?
 

answer

  • This puts you in a difficult position, both personally and as a manager. You will naturally want to look after your own interests and may also be concerned for the employees in your unit. In addition, you still have duties to act in the best interests of your employer.
  • You should consider taking specialist legal advice on the situation. This is a complex area and the following paragraphs can only provide summary guidance.
  • You should obtain as much information as you can from your employer about the proposal to close the business unit and the reasons behind it. As leader of the unit, you will probably already be aware of much of the background, but it is still worth asking questions and testing your own perceptions against those of your employer.
  • If you feel that the proposal is not being made for sound business reasons, it may be worth putting together a business case for an alternative proposal, such as a sale of the business unit, or a cost-cutting programme coupled with investment in a growth area. In appropriate circumstances and with specialist advice, you could consider putting together a management buy-out of the unit.
  • Assuming that you are not able to have the proposal shelved, you should ask about the role your employer expects you to play in the process. For example, you might well be asked to consult with members of your team about their prospective redundancy.
  • From your perspective as a manager:
    • Ensure as far as possible that your employer is taking sound legal advice in relation to the proposal
  • From your personal perspective consider your position, particularly as regards:
    • the length of contractual notice of termination of employment, whether given by you or your employer
    • your likely prospects in the external job market
    • any possible internal redeployment opportunities with your existing employer or other group companies
    • any payment in lieu of notice (PILON) clause
    • any contractual or quasi-contractual rights to an enhanced redundancy payment
    • any post-termination restrictions
    • any share scheme, LTIP or other rights, such as whether you will be treated  as a “good leaver” if you are made redundant.
  • It is also worth considering whether there may be an opportunity for you to earn a retention bonus, for example if your employer needs you to remain for a certain length of time to effect an orderly closure of the unit.
  • It is unlikely that you would be able to challenge the implementation of the proposal itself through legal action. However, there may be grounds to challenge the way in which the termination of your employment is conducted, such as:
    • on grounds of unfair dismissal, for example if there is no genuine  consideration of redeployment opportunities;
    • on grounds of unlawful discrimination and/ or whistleblowing, for example if there is evidence to show that the closure of the unit was in reality a result of concerns you had been raising about unlawful discrimination or malpractice within the business.
  • Before raising any such challenge you should take specialist legal advice.
  • You may be offered a formal settlement agreement, under which you would receive enhanced redundancy terms in exchange for a full and final settlement of all legal claims arising from your employment and/or its termination. Any such settlement agreement will require you to take legal advice and it is important that you take advice which is tailored to your specific situation before entering into the agreement.

 

9. We are senior female executives all working for the same large organisation. The business has published gender pay data, revealing a very large gender pay gap. We believe we are being paid much less than male executives carrying out the same (or similar) work. What should we do?
 

answer

  • Assuming that you are all of the same mind, you should obtain specialist legal advice as a group. For reasons of costs and tactics, it is usually better to act as a group than as an individual in cases like this. However, it is important to ensure that the interests of the members of the group are aligned and that the group operates cohesively.
  • It is important to note from the outset that the equal pay legislation and the gender pay legislation are different and separate. A large gender pay gap may (but does not necessarily) indicate that there is a potential equal pay issue.
  • The equal pay legislation basically provides that female employees are entitled to  receive equal pay (and other benefits) for equal work, as compared with male comparators – and the same for male employees, as compared with female comparators.
  • The gender pay legislation sets out detailed rules for the publication by employers of gender pay information. The information required is not formulated on the basis of comparing male and female employees carrying out equal work.
  • So, a large gender pay gap in favour of men may merely indicate that your employer employs a high proportion of men in senior, highly paid jobs and a similarly high proportion of women in junior, less well paid jobs. This would  not, in itself, be an equal pay issue, although it may well indicate that there are other problems, such as sex discrimination with regard to recruitment and/or promotion.
  • Equal pay claims can be complex and long-running, leading to high legal costs and risks on all sides. Partly for that reason, your employer may be prepared to enter into a settlement at an early stage if you can demonstrate  that there is a real risk of your equal pay claim succeeding.
  • Your first step will usually be to raise the matter internally, through a grievance procedure or equivalent process. Your grievance should give clear details of:
    • the nature of the work carried out by the members of your group and that carried out by a range of male comparators;
    • your reasons for believing that the members of your group are paid less than the male comparators.
  • You should also request that the pay details of the male comparators should be released to you on a confidential basis.
  • You may find that the employer resists providing you with the pay details of the male comparators, on grounds of confidentiality and/or data protection. However, if you were eventually to bring equal pay claims through the Courts or Employment Tribunals, your employer could be required to provide you with the pay details. So, if your employer wishes to resolve the matter without the costs and risks associated with legal proceedings, it is in its interests to find a way to release the pay data to you. 
  • Your employer will probably argue that:
    • the members of your group are not carrying out work which is equal to the work being carried out by the male comparators; and/or
    • the male comparators are not, in fact being paid more; and/or 
    • in any event, there are legally justifiable factors which account for any pay differences.
  • You should not take any such arguments at face value and should require them to be backed up with evidence. If they are not backed up to your satisfaction, you should probably persist with your claims, including through internal appeals if necessary.
  • Ultimately, you may be faced with the decision whether to issue external legal proceedings. There are tactical considerations about the route to take (Court or Tribunal) and timing which are too detailed to be included here. 
  • However, bear in mind that the time limit on how far back you can go in claiming back pay is 6 years, calculated from the date when you issue proceedings. If the internal proceedings are dragging, it may be worth considering issuing a claim coupled with a request for a temporary stay of proceedings. This should allow the internal proceedings to be completed, while protecting your position in relation to the start of the 6 year period.
  • Your employer may eventually decide  to implement a pay restructuring in an effort to iron out unjustified differences in pay. This could (but will not necessarily) include pay increases and payments of back pay for members of your group. Any such steps should be considered carefully with the benefit of legal advice.
  • Members of your group may be offered settlement agreements by your employer in an effort to resolve the issue. Again, the terms of any such agreement should be considered carefully with the benefit of legal advice.

 

 

10. I am a long-serving senior executive. I have been told out of the blue by a senior colleague that the Board has decided it’s time for me to go and that they want to reach an amicable agreement to terminate my employment. How should I react?
 

answer

  • This kind of approach can come as a real shock, particularly after a long period of loyal service. Understandably, people in this kind of situation often feel angry and betrayed. 
  • You should try to avoid reacting immediately, other than to say that it has come as a shock to you, that you will need time to take legal advice and that in the meantime you reserve your position. 
  • You should take specialist legal advice, tailored to your specific situation, as soon as you can. The suggestions in these paragraphs are subject to that specific advice.
  • While you may need to take some time off work, if possible it is usually advisable to resist any suggestion that you should relinquish any of your responsibilities at this stage, even on a temporary basis. Otherwise, your negotiating position could quite quickly become undermined.
  • With your legal adviser, you should carry out a thorough review of the position, including for example:
    • As far as you are aware, the reasons for the approach and the internal politics behind it.
    • Whether there is any realistic chance of the decision to terminate your employment being reversed and whether you would wish to stay even if it could be reversed.
    • Your contractual position, for example your notice period, any payment in lieu of notice (PILON) or garden leave clauses, any rights under share option or other incentive schemes and any post-termination restrictions.
    • Any other binding obligations concerning termination of your employment, for example in any shareholders’ agreement, Articles of Association, or similar documents.
    • Any statutory arguments in your favour, such as unfair dismissal, unlawful discrimination and/or whistleblower victimisation.
    • Your position in the employment market and/or retirement plans (if relevant).
    • The important points for you with regard to any severance terms, including the financial terms, timing and minimising any damage to your reputation and/or future career prospects.
    • The points of maximum leverage in relation to the employer, for example the importance of your relationships with key clients/customers and/or investors/stakeholders; or the threat of a damaging legal dispute.
  • The review should enable you and your legal adviser to devise a negotiating strategy. In some (but not all)  cases, the aim will be to reach agreement on the most favourable, but realistically achievable, severance terms. 
  • If your aim is to reach agreement, points to consider (as well as financial terms) include:
    • the timing of your departure: a sudden exit may be interpreted in a way that is unhelpful for you;
    • the internal and external PR/communications concerning your departure.
    • your duties (if any) during any interim period prior to departure.
    • funding out-placement services to help you to find alternative employment.
    • funding your legal fees.
    • the tax-effectiveness of any payments and benefits.
    • confidentiality, particularly in relation to the agreement itself and the surrounding circumstances.
    • agreed wording for references, coupled with non-disparagement clauses. 
    • the relaxation of any applicable post-termination restrictions.
  • You could conduct negotiations directly with your employer. However, your employer will usually instruct its lawyers to negotiate on its behalf. After the initial discussions it is usually more effective for the detailed negotiations to be conducted between lawyers, on the basis of instructions from their clients. However, it is often useful to keep a direct channel of communication open between you and a key person at your employer, in case there are difficult points which the lawyers cannot resolve between themselves.
  • Assuming that agreement is reached, it should be recorded in a formal settlement agreement, with a formal certificate from your legal adviser that you have been advised on the terms and effect of the agreement in accordance with the relevant statutory rules.
  • If agreement is not reached, you may find that your employment is terminated unilaterally by your employer. In that situation, you should discuss your options with your legal adviser. Depending on the detailed circumstances, they may for example include bringing legal proceedings against your employer for wrongful dismissal, breach of contract, unfair dismissal, unlawful discrimination and/or whistleblower victimisation.

 

 

Skip to content Home About Us Insights Services Contact Accessibility