Your employees are your Company’s most valuable asset. At least, they can be. And so, it can be a tricky balance to ensure you get the right person through the door and maintain that employment relationship. Getting and keeping engaged, motivated, and skilled employees; will make all the difference in a productive and effective business. While you are not responsible for how your employees react to your employment style, you can control what kind of employer you want to be.
The Fair and Reasonable Employer
You will often hear employment lawyers and specialists talking about the hypothetical “fair and reasonable employer”. Everything an employer does is measured against the standard of what a “fair and reasonable employer could have done in the circumstances”. The “could” is deliberate,
The Chief Judge of the Employment Court summarised it helpfully in a recent case (Wilson-Grange Investments v Guerra):
An employer’s actions are to be measured against those that a notional fair and reasonable employer could have taken. That may usefully be conceived of as a target. The bullseye of the target is “employer best practice” and the outer circles of the target comprise “acceptable action”. Towards the outer edges of the target lie the danger zones. Anything off the target is not what a fair and reasonable employer could have done.
The point is, the expectation is not that you be perfect; it’s that you be fair and reasonable. If you aim for “best practice”, even if you miss, you’re still “fair and reasonable” as long as you hit the target. This is fundamental to keeping staff and keeping them engaged and motivated.
But what is best practice?
The Employment Relations Act 2000 says that both employers and employees (because employees also have duties) must deal with each other in good faith. This means being responsive, communicative and active in maintaining the employment relationship. This is premised on the fact that, in order for an employment relationship to work, both parties have to have “trust and confidence” that the other party will uphold their end of the bargain. If, say, an employee has stolen money from you, you may be justified in thinking that the trust and confidence has been damaged, and you might dismiss them. This is where we usually hear the words “trust and confidence”. However, if an employer does not follow through on things; say, an employee raises concern about workload, and the employer does nothing about it, the Employee may then think that the trust and confidence has been broken. They can simply resign, or, in serious cases, they might raise a personal grievance.
It boils down to a few golden rules:
Respond and communicate
These words are in the Act for a reason. Using the same example as above: if an employee complains that they have too much work on, respond to their concern, look into it, and communicate what you find out and what you plan to do about it.
Similarly, you might have an issue with your employee that needs addressing. If it is a small matter, you can just deal with it openly and constructively.
Consult, consult, consult
There is an extra rule for employers, which is that, if you are making a decision which impacts the employee’s employment – this can be a warning, a variation to their hours, termination, etc – you must provide them with all the information you are using to make the decision and give them time to consider it and respond, before you make your decision.
When you hear about “restructure process” or “disciplinary process”, the process is to achieve this goal. Employees feel much more valued when you come to them saying “Here’s what we’re thinking”, rather than “Here’s what we’ve decided”.
When in doubt, get advice
Sometimes, what feels like the right way to handle something might not be in line with your legal duties. Other times, if an employee has acted terribly, it just helps to have someone objective to talk to about the situation. We know that sometimes it can seem overwhelming to have to call a lawyer, and it’s easy to assume that this is better saved until you need representation. If you give us a quick call, we can have a chat about your options. The answer will not always be “you need to follow a process”, because if the goal is to maintain the employment relationship, sometimes the right answer is to go back to basics.
Good employees appreciate employers who are trying to do the right thing and, if you start as to continue, as a fair and reasonable employer, good employees will want to stick around.
To assist our clients with accessing reliable, practical, and cost-effective advice, Aspiring Law offers a subscription model for employment advice. To find out more, or to chat about employment in your business, call Abi Borrows for a chat.