The HR issues faced by start-ups

Changes in Discrimination Law have been introduced at an alarming speed for all small and medium sized enterprises (SMEs). New legislation has placed a great burden of both cost and personnel resource on businesses trying to weather the economic storm and look forward to viable growth. The challenge that must be faced is bound up in managing the legislation now in place and legislation still to come.

It is imperative that SMEs do not make the mistake of believing that the new law will have no effect on them; it will and it will cost money. Dealing with unsolicited CVs alone will have enormous consequences. In the current economic climate, many employers receive CVs from candidates in the hope that a position may exist. Regardless of whether or not a job actually exists, the discrimination law requires that employers be ready and prepared to explain why an individual has not been hired on any given occasion, even when the application was not requested.

The current challenge

Do you know the risks involved in preparing a recruitment notice for your business? Preference cannot be given to locals and you cannot require qualifications specific to Jersey or the UK, for example. Ignoring these points can now find you up in front of the Tribunal probably wondering why you bothered launching. The simple fact is that discrimination legislation demands that all businesses in Jersey devote time and money to ensuring that they are fully compliant. There is no defence in ignorance or lack of time.

Discrimination is defined in two forms: direct and indirect. Direct discrimination is when a person is treated less favourably than others on either racial or other protected grounds. A simple concept, perhaps but the devil is certainly in the detail of being clear as to what constitutes less favourable and which grounds are pertinent.

However, this element of the legislation is relatively simple when considered with indirect discrimination. This is where a practise or criteria adversely affects a person of a particular group preventing a claimant from being treated the same as others. This covers race (for now) and when the employer cannot be shown to be using a proportionate means of achieving a legitimate aim, they are in trouble.

Legislation to come – new threats to SME’s?

In September of this year discrimination legislation will continue to roll out and cover sex discrimination, sexual orientation and gender reassignment. Sexual orientation covers men’s and women’s sexual attraction to persons of the opposite sex or gender, the same sex or gender, or to both sexes or more than one gender. Generally considered to be heterosexuality, homosexuality and bisexuality. Asexuality, the lack of sexual attraction to others, is sometimes identified as the fourth category.
There is some assistance from government with this next wave of legislation. Employment Law will not affect new recruits for the first year and this is well worth noting given the fears voiced by SME’s that a wholesale introduction of the law would simply cut off any appetite they may have had for growth.

What does the legislation mean in practical terms?

Ali left college and joined a builders firm. After a period of training she was assigned to head up a small contract. The site manager made clear he resented having a woman assigned to “his” site. He made disparaging, sometimes lewd, comments about her appearance.

Ali verbally complained to her manager. The site manager’s behaviour failed to improve. One day, Ali came into work and overheard a colleague bragging to other crew members that he had “slept with her”.

Although untrue some of the team believed him which made it increasingly difficult for her to manage them. Ali started having trouble sleeping at night and her GP told her she was suffering from work related stress and signed her off work for one week.

Ali then contacted her union who advised her to lodge a formal, written complaint to her boss using the grievance procedure. Ali’s boss assigned another site manager, an old drinking buddy of her site manager, to investigate the complaint. He did actually remind everyone about the policy on harassment and discrimination in the workplace but did little else.

One of the builders did speak up. Regardless a report was filed that there was no problem on site and the behaviour got worse. Ali began suffering from severe depression and was signed off for another week. During her time off, she filed another grievance. Nothing further was done.

Ali resigned and took her claim for constructive dismissal and sex discrimination to the Tribunal winning a six figures sum.

Employers must remain vigilant about these new rights and not forget the considerable cost of getting it wrong in hours worked arranging the case and up to £10,000 for financial loss of the employee and up to £5,000 for hurt feelings.

Go it alone or seek professional support?

Clearly there are advantages to having an in-house HR function, not least the day-to-day contact between the senior team. However, the drawbacks are equally clear. With costs to employ an experienced HR practitioner reaching £80,000 per annum this option can prove prohibitively expensive. Despite this the need to be able to draw on this specific set of skills is beyond doubt. SME’s cannot function safely in the current and future legislative environment without them.

You might expect that we would recommend the external option because this is the core function of TM Legal but there are sound reasons for doing so.

We can offer the full suite of HR support skills needed at a fraction of the cost. These include:

• HR support including advice on staff contracts and handbooks.
• Representation at Tribunal should it be required.
• Mediation, a form of alternative dispute resolution (ADR), and a way of resolving disputes between parties with fabulous effects. Typically the mediator assists the parties to negotiate a settlement. In the workplace this is hugely beneficial before matters escalate. The benefits of mediation include cost, confidentiality, control (the parties control it not a Tribunal) and support for the parties from the mediator.
• In-house training, in relation to Employment Law and Practice in an easy to understand format.