Representing Employers' Interests In The UK And Beyond

Saturday, July 1, 2006 - 01:00

Editor: In what areas do you concentrate your practice?

Syder: I am an employment law specialist based in London. I work from our Covent Garden office. My practice is quite broad, and I increasingly represent international clients. My most recent project involved helping employers to restructure bonus schemes in various European jurisdictions. Other recent projects have involved helping clients with the UK aspects of their restructuring and downsizing in Europe. I also get involved with inward-investment initiatives and start-up companies, as well as IT and financial management clients who are looking for employee documentation. I do a lot of work for and against senior executives, including advice related to their hiring and firing processes. As a result of that activity, I often provide advice on the remuneration issues that arise.

Editor: What attracted to you to Clarkslegal?

Syder: One of the many attractions of being at Clarkslegal is the diversity of work. At any given time, I am representing a range of clients from a variety of different industries on a breadth of human resources issues involving such matters as discipline and grievances, pay issues, sickness issues, absenteeism issues and business transfers.

Editor: What types of legal support does Clarkslegal provide for the Confederation of British Industries (CBI)?

Syder: As the leading employer organization in the UK, the CBI invariably is called upon in public policy discussions with the government and worker organizations such as the TUC (Trades Union Congress). I have helped the CBI's employment advisory group, which looks at transfers of businesses, procurement and other public sector issues. Our Managing Partner, Michael Sippitt, sits on the CBI's forum involving high-level HR Directors.

Addressing developments in employment law and practice, we advise the CBI on such draft UK legislation as the forthcoming age discrimination legislation.

For the last three years, I have served as the CBI's sole representative on the Application of Labour Standards Committee at the International Labour Conference of the International Labour Organisation (ILO) to help ensure that the perspectives of UK employers are heard.

Editor: What issues are on the committee's agenda?

Syder: Once a country has ratified an ILO convention, it is obliged to report regularly on measures it has taken to implement it. The Committee of Experts examines the government reports on ratified conventions. The annual report of the Committee of Experts is submitted to the International Labour Conference, which is examined by the Conference Committee on the Application of Standards. The Conference Committee is made up of government, employer and worker delegates. It examines the report in a tri-partite setting and selects from it a number of observations for discussion. In many cases the Conference Committee draws up conclusions recommending that governments take specific steps to remedy a problem or to invite ILO missions or technical assistance. Cases include issues concerning freedom of association, collective bargaining, child labor, forced labor, equal treatment and so forth.

Editor: Why is it important that UK employer interests are represented in the ILO?

Syder: UK employers have a lot of experience on these issues, which it can share in this unique international tri-partite forum. The CBI wants to continue to have a strong voice with regard to international policy considerations related to the development of future ILO conventions and recommendations.

Editor: How often are the UK and American employer interests aligned?

Syder: That depends on the nature of the case. The Americans and British work closely when it comes to the international employers' organization at the International Labour Conference. I am part of a small sub-group of employer organizations, which help prepare the international employers' organization's case responses to the chosen cases that are examined in the Conference Committee on the Application of Labour Standards. Our leader in the Conference Committee on the Application of Labour Standards is Ed Potter, from the U.S., who works for Coca-Cola. He is an inspirational figure who believes in a collegiate style of work. The international employer group responds well to him.

Editor: How many people are on the committee?

Syder: The ILO currently has 178 member states. Each country is entitled to send a representative to serve on the Conference Committee of the Application of Labour Standards. This year, the countries that were examined by the committee included: Burma, Zimbabwe, the U.S., the UK, Australia, Guatemala, Costa Rica, Pakistan and others.

Editor: What humanitarian interests does the ILO help its members to address?

Syder: The ILO often does not get the publicity that it should. For example, the ILO has done a lot of important work with positive results in the African sub-Sahara region and other parts of the globe with respect to the current situation related to forced labor and the worst forms of child labor.

Editor: Why should companies be interested in the ILO's efforts and achievements?

Syder: Regardless of its current location, any company that is thinking about investing in a foreign country needs to understand its labor issues. There is no better starting place to assess a country's labor record than finding out which ILO conventions the country has ratified and then assessing the country's record with regard to implementing the national law and practice necessary to implement the conventions.

Editor: You mentioned that some of your recent projects for UK employers have involved bonus schemes.

Syder: Employees often become disgruntled when they believe that they should have received a bonus, but they didn't. When assessing a bonus scheme's entitlement, the customary starting point is an assessment of whether it is a contractual scheme or not and whether it is discretionary or whether the employee is entitled to certain amounts based on performance criteria.

A whole host of discrimination issues can arise with regard to bonuses for employees who are, say, on maternity or disability leave. It is best to anticipate the issues and think through a bonus scheme and address various permutations as a policy matter in advance to help avoid a claim that an ad hoc decision is discriminatory.

Editor: What are some of the difficulties that employers face in the UK with respect to permanent health insurance?

Syder: Large organizations are often pressured to provide competitive compensation packages to their employees, which normally in the UK includes permanent health insurance rather than merely the statutory sick pay scheme. In addition, the package might include between three and six months of full pay before permanent health insurance applies.

The difficulty arises for employers because, once the employee is receiving permanent health benefits, it is currently illegal for the employer to terminate that employment contract thereby ending the entitlement. This causes major headaches when there is a need for restructuring or bringing someone in on a temporary basis to cover that role. Employers often miss these issues. They focus on the need to provide competitive benefits without considering the consequences.

In October this year, the new age discrimination regulations are coming into effect. Many companies will increase their normal retirement age and so will need to anticipate that the premiums for required health insurance will rise because it is more expensive to insure older employees.

Another difficulty relates to the insurance companies' reluctance to accept claims. They may require one or two separate medical reports, which can lead to anguish and/or stress for the employee. The employer can be faced with a situation where the employee's coverage to enhanced sick pay has run out, but the permanent health insurance claim has not been accepted.

Editor: What problems do UK employers experience when they need to stop employee benefits?

Syder: This is a problematic situation. First, the employer has to examine whether the benefit is contractual or non-contractual. If the employer has a contractual obligation to, say, enhanced redundancy pay or sick pay, the preferred way the employer should vary that arrangement is with the employee's express consent. If the employer unilaterally varies the contract, the employee is entitled to raise a grievance, which can lead to the filing of suit.

If the matter is not resolved, the employer can then be faced with a claim in an Employment Tribunal for breach of contract. Worse yet, the employee can resign claiming that the modification of the agreement was a fundamental breach of contract entitling him or her to claim constructive unfair dismissal. In the UK, the current maximum compensation for an employee in those situations is 58,600 pounds. Defending that type of claim can be expensive, and it is not guaranteed that the employer can recover its legal expenses even if it is successful.

This is a difficult situation for employers, especially if they have a collective bargaining agreement with a trade union. The employer should consult meaningfully with the union and consider the economic, social or organizational reasons why the provision of the benefits needs to stop. I often see contracts that were drafted many years ago without the benefit of legal advice under which the employer has created a contractual entitlement. Today, we try to construct the agreement so that the employer reserves the right to amend the terms of the agreement or to withdraw the benefit at any time. We build in flexibility for the employer to have options if it is faced with an unfortunate situation. A good employment contract should be sufficiently detailed so it can be a preventative measure.

Editor: Please tell our readers about www.employmentbuddy.com.

Syder: Our specialized website we developed in-house. It offers unlimited access to HR-related materials such as: guidance notes, fact sheets, checklists, templates, HR policies, feature articles, HR diary. We can also provide one-on-one advice as needed. For more information on the services we offer, visit our website, www.employmentbuddy.com.

Please email the interviewee at csyder@clarkslegal.com with questions about this interview.