No-Fault Dismissals: Arguments for and against the Beecroft Proposal

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No-Fault Dismissals: Arguments for and against the Beecroft Proposal

The Beecroft Report which was published last month has aroused a lot of comment from HR professionals and business people alike – with fervent advocates on both sides of the debate. The argument has polarised between supporters of the proposal who feel that the pendulum has swung too far in favour of the employee, and those who feel that the introduction of a no-fault dismissal would return us to an environment where employees feel vulnerable and insecure.

As is often the case, I can see the argument from both sides. As an HR Director trying to ensure high levels of performance, and keen to ensure that my organisation followed both the spirit as well as the letter of the law, the lengthy procedures around disciplinary and capability procedures, and the uncanny ability of Trade Union officials to find fault with the process (if not the essence of the case) led to a fair amount of frustration and annoyance on my part. It often seemed as though the weight of the legislation, not to mention our own policies and procedures, meant that the capacity to delay, obfuscate and muddy the waters around what should have been a straightforward judgement about performance became mired in tedious and unedifying confrontations about process.

And yet… I would also suggest that the protection offered to employees by the legislation currently means that managers have to treat the business of performance management very seriously indeed. They must focus on facts and be able to demonstrate that their standards are consistent, reliable and equitable. There should be evidence of informal support and development prior to any formal action being taken, for the majority of cases at least, and employees should feel that they both understand what is expected of them and also understand what they can realistically expect from their employer.

How can that be a bad thing?

Wouldn’t we all want to be in that position? And if managers cannot meet these principles, why is that the case? I accept that it can sometimes be difficult to define exactly what the problem is with the way in which an employee is working, but it could be that the role is not clearly enough defined; that the expectations are unrealistic or that there is a gap between what it says in the Standard Operating Procedures and how they are being interpreted by managers.

In addition to the practical arguments above, the CIPD has questioned the effectiveness of the proposal and whether indeed this really is a problem that will be addressed by the introduction of a no-fault dismissal clause. As Mike Emmott, CIPD’s employee relations advisor said in a recent posting on the CIPD website:

“Countries that have excluded small businesses from unfair dismissal regulations, which include Germany, Australia and Spain, have generally found it has failed to achieve the intended result.

There is no evidence that no-fault dismissal would make a positive contribution to economic growth in the UK by encouraging the smallest firms to recruit more employees. Indeed, by increasing job insecurity and reducing employee engagement it would be more likely to damage growth.”

So, if the research and experience from other countries fails to support the premise of the no-fault dismissal clause – that it will free up small businesses to employ more staff – then why would we want to risk dismantling hard-won employment protection for the vast majority of workers in the UK?

My solution would be to ensure that managers, supported by proactive and confident HR advice, manage the performance levels of staff to ensure that the UK economy rebuilds and recovers confidence levels that will allow the expansion and growth that is so badly needed.

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By | 2012-06-12T09:26:37+00:00 June 12th, 2012|Categories: Solo Consultancy Ltd, Uncategorized|0 Comments

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