Lay down the law

It’s been raining employment law over the past decade. While this may have secured impressive fees for lawyers, it’s also driven HR departments to distraction.

Disseminating new rules on pay, holiday entitlement, equality and health and safety in the workplace is particularly challenging for larger retailers. Typically, these businesses employ thousands of individuals across a large geographical area, experience high levels of staff turnover and struggle to communicate directly with store and distribution workers who aren’t stationed at a PC, so are unable to access e-mails or the company intranet. Not updating internal procedures to reflect changes in the law – or updating them incorrectly – can result in hefty financial penalties.

“Employment law requires many updates and, in recent years, we’ve seen a tremendous amount of legislation in the family arena,” says Karen Black, partner and head of employment at law firm Boodle Hatfield. “For instance, eligibility for flexible working has been extended and there have been changes to parental leave and adoption leave. Meanwhile, holiday entitlement has just gone up from 20 days to 24 and this will have had a major impact on retailers, which tend to offer the statutory minimum annual leave.”

Black has worked with retail clients on understanding and communicating the new Age Discrimination Regulations and the impact of the smoking ban, too. “Employment law changes come into force in April and October, so at least employers have set dates to work towards and know what’s coming,” she says. “With new entitlements or regulations, HR departments must update the staff handbook and company web site, alter recruitment literature and training materials and review their employment contracts and disciplinary procedures. It’s an enormous amount of ongoing work.”

Simon Arora, chief executive of 70-store discount retailer B&M Retail, feels that compliance with employment law is manageable if HR departments observe legislative changes keenly and ensure the company handbook is updated regularly. “We also send out information to store managers via the company intranet and our area managers play a crucial role in communication and training. Having an HR consultancy to advise us on what changes need to be made is also invaluable,” he says.

It is crucial the entire business is aware of employment legislation. Harvey Nichols group HR manager Robert King says: “If the law is not understood clearly and we fail to follow internal procedures, we leave ourselves open to claims of sex, race or age discrimination, as well as claims of unfair constructive dismissal.

“It’s a risk management issue. A lot of our hard work on the retail front can become unstuck by a large award, because of inadequate comprehension and application of the law.”

At Harvey Nichols, HR teams attend regular employment law updates with selected law firms. A monthly management briefing document is distributed around the business and used by store managers to communicate with their teams verbally. “All shopfloor staff attend a briefing session each morning before the store opens and we find this is a perfect opportunity to capture their full attention, particularly for important communications around employment law and company policy,” says King. “Our managers are briefed regularly during half-day training sessions, updating them on recent and upcoming changes in legislation.”

Black says company handbooks that outline disciplinary rules, working time policies and health and safety issues provide a valuable tool for retailers to prove that they have communicated the legal boundaries. “However, in a tribunal, it is not enough to show you have distributed an up-to-date handbook. You must also prove it has been received, read and understood,” she warns. “For this reason, it’s advisable for employers to ask staff members to sign a receipt, saying they have read and digested the document.”

Black also advises supplementing your written company policy document with other regular communications. “Staff magazines, web sites, in-store briefings and training sessions will all ensure you have plenty of evidence that new legislation is being channelled through to staff and actively taken on board by individuals,” she says.

Keeping communication active – perhaps by asking staff to complete a quiz to test their understanding or act out scenarios in training sessions – can be particularly effective. “And, of course, having a member of staff who takes responsibility for legal issues and is always available to deal with questions and concerns is invaluable. Many disputes brew over long periods of time and the right personnel taking charge of the situation early on could often have nipped the problem in the bud,” adds Black.

Technology can play a role, too. Workforce management systems and company intranets linking head office with store managers’ offices can be used to alert managers to legal updates and outline training requirements.

For example, Vodat International has developed software system Store Communicator – used by retailer TJ Hughes – that outlines clearly tasks that need completing and tracks responses to requests for action. “The system creates a diary showing what progress is being made and head office can track who hasn’t replied to the message,” says Vodat International chief executive Mike Bielinski. Automated communications systems also allow head office to keep detailed records of who has been contacted, the outcome and who needs chasing.

Savvy employers will happily invest time and resources in communicating employment law updates in a variety of ways because, more often than not, they’re great news for staff, says Black. “Telling your team that their holiday entitlement is extending or that they can request to work flexibly will probably boost staff morale and improve the company image, so spelling it out loud and clear should be a priority.”