I was minding my own business when @FlipChartRick (thanks!) sent me a link to a Centre for Policy Studies paper by Dominic Raab MP calling for some employment law reforms. I had ignored the story when it came out because its pretty obvious that right wing MPs would like employment law to be tilted more towards employers. I disagree with them , but what can you do?
Still, I read the paper and was particularly struck buy what Mr Raab says about how the law currently works in relation to dismissals for poor performance. In fact I was so struck by what he said that I’ve actually written to him about it.
Here’s the letter, I’ll let you know if I get any reply.
Dear Mr Raab
I am writing to you having read your paper ‘Escaping the Straightjacket’ which makes a number of proposals for employment law reform. For the past 20 years my career has essentially been about explaining employment law to businesses – both HR professionals and line managers – and I have also had considerable experience in advising small businesses on employment law issues.
One of my frustrations is that there is a great deal of misunderstanding about just how employment law operates and what employers can and can’t do. I find that when employers are given accurate information about employment law, they can accept that in most areas it represents a common sense balance between the needs of employers and the right of employees.
In recent months, however, I have become increasingly disappointed with the level of public debate on employment law issues – and in particular on the concept of a ‘no-fault’ dismissal put forward in the Beecroft report. My concern is that in putting the case for a no-fault dismissal Beecroft and his supporters have suggested that employers are currently prevented from dismissing under-performing employees by the law of unfair dismissal. Any such suggestion is misleading.
It is in this context that I would like to challenge your proposal for ‘no fault dismissals’ on page 6 of your paper. In particular, this passage:
“A better solution would be to run “no fault” dismissal in parallel with unfair dismissal, with both applying after a worker has been employed for two years. It should still be possible for an experienced employee to makes a claim for being sacked unfairly. However, the definition of fair dismissal should be widened, for example, to encompass inadequate performance which falls short of the current standard of inherent inability or neglectful incompetence, to allow greater scope for “no fault” dismissal for underperforming employees.
Introduced in this way, “no fault” dismissal would help employers get the best from their staff. Despite critics’ protests, it would only affect the small minority who do not pull their weight. Few employers are interested in getting rid of good employees. If we want to boost the overall number of jobs available, firms should be able to hire with greater confidence that they will not be burdened with incompetent or underperforming workers.”
It seems that the premise for your proposal is that it is not currently possible to fairly dismiss an employee for ‘inadequate performance’ and that a fair dismissal is only possible if it can be shown that the employee is inherently unable to do the job or has exhibited ‘neglectful incompetence’.
Anybody with any experience or knowledge of employment law, however, could tell you that this is simply not the case. Indeed I am rather puzzled as to what could have led you to make such an assertion. Your footnote contains a reference to Selwyn’s Law of Employment (a leading undergraduate textbook) but does not refer to any specific case law to that effect.
The truth is that it is perfectly possible to fairly dismiss an employee whose performance is judged by the employer to be inadequate. Indeed such dismissals are common. The law of unfair dismissal requires that the employer behaves reasonably in dismissing the employee and in the context of poor performance this will usually mean clearly explaining the ways in which the employee’s performance is falling short. The employee should be warned that his or her performance could lead to dismissal and be given a reasonable opportunity to improve.
All of these requirements must be considered in the light of the particular circumstances and the employer’s business needs. For example, it may be perfectly fair to give no opportunity to improve where the employee’s performance is actually damaging the business, or where the employee is ‘inherently unable’ to do the job. Perhaps the references to ‘inherent inability or neglectful incompetence’ that you picked up from Selwyn were in the context of dismissals without warning or any opportunity to improve? Do you think that the current requirement (in most cases) for a warning and an opportunity to improve is an unreasonable one?
These principles of fairness are well understood by the HR profession. In my experience, what tends to stop employers from dealing with poor performance is not in fact any legal restriction, but rather a very human aversion to having difficult conversations with underperforming employees. That is not a problem that legislation can solve!
I can see the political benefits in overstating the extent to which employment law prevents a business from dealing with underperformance. Doing so makes the Beecroft proposals seem less extreme. However, this constant drip-feeding of misleading information about employment law does a disservice to the very businesses you are trying protect. Small businesses may not have access to sound advice, and if they read in the press that they can’t dismiss an employee who is performing poorly then they are likely to believe that that is actually true.
I hope therefore that you will be able to correct that part of your paper which suggests that underperformance cannot for the basis of a fair dismissal. I am posting a copy of this letter on my blog ‘A Range of Reasonable Responses’ and will happily undertake to publish any reply you might care to make to the points that I have raised.
I look forward to hearing from you