Employment tribunals – our advice to charities

Employment tribunal claims are the stuff of nightmares for any employer. It’s a time-consuming and costly process which can pose a huge risk to the employer’s reputation. Unfortunately, employment tribunal claims are on the rise, and something that employers should be prepared for.

Charities are not immune from tribunal claims – if anything, they may be more vulnerable than any other employer, in that they have a huge amount at stake when it comes to reputational damage. There is always the risk that a key funder may withdraw support on finding out that there is a claim under way, or that adverse publicity might lead to a drop in donations from members of the public.

There is also the thorny question of the Charity Commission – even if a potential claim might not indicate that anything has gone seriously wrong in the charity, there may be a requirement to report the matter to the Commission under their “serious incident” reporting regime, and a tactical advantage in letting the Commission know about the problem before someone else tips them off. Possibly worse still, the situation could be brought to the attention of the Charity Commission by someone else or even an increasingly critical or hostile media outlet.

There is also the problem that charities are, rightly or wrongly, often held to a higher standard than other employers and are expected to apply their stated values when acting as an employer in the same way that they would when dealing with beneficiaries.  This problem will be particularly acute where the charity’s work is based on principles of fairness, social justice and the protection of people’s rights.

The fact that many charities are funded by central or local government, and that most will also take advantage of Gift Aid and other charity tax reliefs, means that the public feels justified in feeling outraged if a charity appears to have treated an employee unfairly.

All these factors mean that an unhappy employee (or former employee) might be more inclined to pursue a claim against a charity than against any other sort of employer, knowing that their employer will be particularly keen to avoid reputational damage.

When dealing with disputes and claims, our clients often face a dilemma: is it best to hush up a claimant and reach a settlement, or is it better to fight until the end? For our charity clients, all too often the first option seems more attractive, given how destructive bad publicity can be. However, settling too many claims too quickly could give off the impression that the employer is a light touch, and could encourage other employees to follow suit. It also runs the risk of the charity being seen to sweep problems under the carpet – we have seen in the case of Oxfam how a reluctance to take robust action to tackle serious issues within a charity’s workforce can backfire in the long run.

So, what should charities do to manage this risk?

Prevention is better than cure with most things, not least employment issues. With any workforce, the starting point should always be an open and supportive workplace culture. Employees should be aware of what their role is, what is expected of them, and who they report to.

A knowledgeable HR team will always go a long way. Disputes and workplace conflicts are inevitable, and it often pays to have someone that is removed from management lines to ensure that your organisation runs smoothly. The existence of an impartial HR team can do wonders for morale, and the levels of trust in your workplace. Employees that trust you and like you will generally try to resolve issues amicably in the first instance.

Written documents are key. There may be a tendency among our clients in the charity sector to see the best in their staff and to trust them to behave honourably.  This tendency comes from a good place, but it can often result in a painful bite. Up to date employment contracts are a must, as is a good set of policies. Employees like to know where they stand, and what they can do if they have a problem. This being said, it is also important that managers and HR staff follow the policies. There is no use having policies if ultimately those policies are ignored, and discretion used instead. As far as is possible, employees should be treated the same, and managers should be trained to know what to do in which circumstance.

Similarly, it is important to take notes of important meetings. Underperforming employees need to be performance managed, and there should always be a strong paper trail of conversations and meetings. The same goes for misbehaving employees. Written records of warnings and discussions will go a long way towards defending any eventual claim. Just because a conversation may be difficult to have, does not mean that it should not take place. It almost always should.

What happens if, despite your best efforts, an employee brings an employment tribunal claim against you? Whatever you do, do not ignore it. The first step in the process is likely to be a call from ACAS about the proposed claim. Fight off all your instincts to slam down the phone and push the conversation to the back of your mind. This is your chance to find out more about the claim, and investigate whether there is anything to it. If possible, engage with ACAS, and use the time that they provide to consolidate your arguments. ACAS provide a great service, and the ACAS Early Conciliation process gives some time to address your minds to strategy.

Unfortunately, the reality is that sometimes you can do everything right, but still end up with your case in the tribunal. If you do find yourself in the middle of a HR nightmare, you may wish to seek specialist legal advice. Lawyers are trained to provide guidance and can spot risks that you may not have been aware of. Bear in mind the option of using HR consultants in the first instance, but do also bear in mind that it can be worth engaging lawyers at an early stage, not just for the tribunal hearings – just make sure you square things off with your HR consultants (if you have them) and that your insurers are kept informed throughout.