When HR gets it wrong, the stakes are high. From unfair dismissal findings against a business to vicarious liability, one legal expert explores the four areas where practitioners are most vulnerable and how to avoid these HR mistakes.
If the average business manager has a bad day, chances are the worst that will happen is more work the next day to make up for it. When HR has a bad day, a range of consequences can unfold. In the past couple of years, workplace investigations have become more common, and HR is usually tasked with carrying them out. However, acting as investigator requires a special skill set, and the untrained HR manager might fall into procedural errors resulting in an unfair dismissal claim – or worse.
More worryingly is the continuing trend of cases where HR managers have been held personally liable as an ‘accessory’ in workplace claims. In 2010, a Sydney HR manager was held liable as an accessory to his company’s unlawful sham contracting activities in a case before the Federal Magistrates Court. In a more recent case, an HR manager was held liable (along with the business) for underpaying wages to employees. These cases tell us there is an expectation that an HR manager will know employment laws and ensure that fair process is accorded to employees during workplace investigations or similar events – particularly when an employee’s job is on the line.
Why are HR managers generally held to a higher standard than other managers? It’s partly due to the role HR plays in business decisions with the potential for legal claims, such as termination of employment. This makes them a target for criticism and opens their actions to dissection before a court or tribunal if a claim is brought, not to mention the HR manager having to give evidence – an experience unlikely to be on anyone’s bucket list.
Here are four areas where practitioners are likely to make HR mistakes, and the steps you can take to protect yourself:
1. Dismissing an employee
HR managers are not expected to be employment lawyers, but they are expected to understand the laws as they relate to serious decisions like dismissal. If there is any doubt about whether a situation justifies dismissal or the process to be followed, HR should consider seeking legal advice.
2. Workplace investigations
Never assume that just because someone is an HR professional, they possess the skills to conduct a proper workplace investigation. Investigations require certain skills (such as interview techniques) and understanding the rules of procedural fairness. If no one in your HR team has the experience and skills to conduct a proper investigation, consider outsourcing to an external investigator to make sure you get it right.
3. Enterprise agreements
In a recent case involving an employer in the mining industry, an HR manager made mistakes in their application to approve an enterprise agreement, which led to the Fair Work Commission refusing the application. This meant the whole bargaining process needed to be repeated. Sometimes it pays to get professional advice if you’re not familiar with a process – at least the first time – to avoid wasted time and money down the track.
4. He said, she said
HR often requires tough conversations with employees on issues including performance management, misconduct or redundancy. Given the potential consequences, good notes of conversations are critical in case an employee chooses to make allegations or bring a claim down the track. If you are doing the talking and can’t take notes, have someone else in the meeting take notes, or be sure to write a full file note as soon as possible after the meeting ends.
Kerryn Tredwell is a Partner at Hall & Wilcox Lawyers.