Laying an employee off

knipex

9 months ago I employed a person to look after our accounts (invoicing, payments, payroll, VAT returns, updating of P&L sheet, updating budgets and forecasts on a monthly basis. As this would only involve a maximum of a day a week this person was also responsible for receptionist and admin duties.

The duties and responsibilities were well explained in advance. We interviewed a number of candidates and chose one that while young claimed quite a bit of experience and was studying for a for an accountancy technician course. We checked out references and our only concern was regarding their skills as a receptionist but we decided to give them a go.

For the first 3 months they worked under close supervision of an accounted and all seemed well. After 5 months I organised a full review of the accounts and all seemed fine.

At all times I tried to keep an eye on things and where possible help or organise help. (I am not an accountant have no qualifications in the area and minimal experience)

We are a small company with a small number of staff, We have minimal purchases and issues perhaps 3 invoices a month. Budgets and forecasts have to be updated monthly and due to the nature of the business a number of costs have to be estimated (any corrections are made the following month).

Later we got busier and I had less and less time to be involved in that side of things. Early this month I was going over end of month accounts and discovered that we were showing a net loss for the month despite significant revenue. When I went through the figures I discover a very large entry that I could not explain. It turned out that a number of bills had not been accrued for the two previous months and instead been rolled over and carried into last month. This get me worried as it one of the things we are very careful about .

I then pulled out the budget and forecasts for the previous 3 months and found a number of errors. Projected revenue input as costs, costs allocated to the wrong areas etc.

This has got me really worried and I have now organised a review of the entire years accounts. (at significant cost)

I pulled the person aside and had a chat to see if there was anything wrong to be told all was fine. Later I found an excuse to review next years budget with them and to my dismay discovered that they have at best a limited understanding of how the accounts are structured. They are in completely over their head.

To be honest I was shocked, the stuff we were looking at was very basic, well within the limits of my knowledge and should have been second nature to this person. I was so shocked I just walked away....

I have spent the weekend thinking about it and I really have no option but to lay the person off. I don't have the time to spend with them and even if I did my knowledge is not strong enough to take them to the level they need to be at.

We are a start-up struggling to break even this year and to be honest this is the last thing I need especially having to replace them this close to year end but I just done have any other option.

The reason I am posting here is to get advice as to how I go about laying this person off. My understanding is that as they have been working for the company for less than 12 months that's its a relatively simple process and that I just have to give them notice..

The person is clearly not up to the role but is extremely defencive when challenged. I expect their to be a serious blowup when I lay them off and really want to make sure that I am covered.

The reason I know this is that previously I had reason to approach this person regarding their phone manner both to suppliers and customers. I also had to pull her on the way she treated sales people who called. She got extremely defencive and argumentative and while her manner did improve it is not something I look froward to repeating.

antoinolachtnai

I think you need to be very careful here and get professional advice. It is very important to act quickly, within the next week or so (because once the person is with you more than 11 months, matters may become more complex).

The issues are:

- is there a probation period?

- have you given appropriate warnings?

- do you need to do so, given that the person is less than 12 months and therefore has no recourse to the EAT (note: in certain cases the person may still have recourse)

- are you dismissing the person because there is not enough work to do permanently (making them redundant), temporarily (laying them off) or for cause, i.e., that they are not capable of doing the job and you need to replace them with someone else. These are all very different and it is critical that you understand the differences, know what you are doing, and act appropriately.

The answers to all these issues are something you really need to discuss with an adviser such as a solicitor specialising in the area or a HR specialist familiar with employment law.

Bandara

As far as I am aware it's just call them in and pay them as per the terms of their contract if they have a specific agreement or normally it's a week for over 13 weeks and less than 12 months.

By the sounds of them I'd just tell them you do not require them to work the notice and send them home immediately.

Check with the sfa or rgdata etc, I'm no expert in this


Edit- the previous post is far better advice than mine.

antoinolachtnai

Thanks for kind words Hammertime!

The drawbacks of just pulling them and making them redundant - if he does that, and then he employs a new, different bookkeeper/accounts/admin person, the employee may well be able to claim for constructive dismissal to the EAT (if they are eligible to do so, and in certain circumstances, they might be). Also, if he claims that he is making the person redundant on the basis that the company can no longer afford to retain an accounts/admin person, this person (as the accounts clerk) might be in a position to disprove this, or at the very least cast a doubt on it.

And although we can probably assume the person is paid around average industrial wage, in certain circumstances, it may be worthwhile for the person to have recourse to the courts rather than the Tribunal (been on the receiving end of that one, twice).

This is the problem - it all depends on the subtle details - . I am not really the expert on this either, and the details are always changing.

BarryM3

I think you are ok to just let them go. They would need to be in your employ for 12 months to instigate an unfair dismissal claim

http://www.employmentrights.ie/en/informationforemployers/unfairdismissals/

antoinolachtnai

Depends - if the person is pregnant, or if there is an issue relating to trade union membership, then you are in trouble. The pregnancy issue happened for a well known company, for example, although the company did not know the person was pregnant.

MB74

This might be of some use and document everything

Minimum notice required is one week (unless contract states otherwise)

To justify a dismissal, an employer must show that it either resulted from one or more of the following causes:
a) the capability, competence or qualifications of the employee for the work s/he was employed to do;
b) the employee’s conduct;
c) redundancy;
d) the fact that continuation of the employment would contravene another statutory requirement;
d) that there were other substantial grounds for the dismissal.

A redundancy situation arises, in general, where a job no longer exists and the person is not replaced. Maybe make the position redundant and spread the role between a few people for the next couple of months, if it's only a one day a week role then you should hopefully be able to do this.

You will get further information from www.entemp.ie

Hope this is of some help.

Best of luck.

Michael.

mikemac

Ask the SFA for advice

And be careful, ask for advice before you do anything

mcaul

If the person is causing you problems, then you should have no fears about letting him/her go. And as their position is less than one year with the company, just one weeks notice is required. - let it go past one year and you need to give 2 verbal warnings, one written warning and thread on eggshells.

Keep the dismmissal short & sweet to avoid any potential backlash. Also as he/she is in a position that they could do things to your systems during the one week notice period, its best to let them leave immediately and pay the weeks salary in lieu of notice.

Dear x

After a review of your performance I regret that you not suitable for the position in which you were employed, therefore I regrettfully will be terminating your employment with immediate effect.

One weeks pay will be provided in lieu of notice.

Your sincerely

PhatPiggins

Do it on a friday, it wont effect the rest of the staff as much as if you do it at the start of the week.

As the above poster said pay him/her the week notice under the proviso that they dont actually have to work for it.

knipex

Thanks for the advice guys.

I hate letting people go especially as I have to accept at least partial responsibility. The issue is not with their work ethic but with their capability. If it was just laziness then I wouldn't really care.

I have been promised the results of the review of the accounts by the end of the week so am going to hold off until I see how bad things really are but decision will have to be made by month end....

Just means I am either without someone in accounts for year end or a new person starts in the deep end.

Sonnenblumen

Did you provide the employee with a Employment contractds which amongst other items clearly specifies duties, responsibilities etc etc. If not you could be in big trouble no matter how unsuitable the employee is. Seems to me, there was inadequate supervision, afterall, it is the manager's role to supervise all employees especiallly new ones.

This is far from black and white and I would speak to a HR specialist, ignore maverick rambo type 'fire them' advice, because a sniff of unfair dismissal is all that is required and you'll end up before the ETA and paying 5 fig penalties.

Proceed with caution and if you do decide to part, try and reach a reasonable settlement.

buck65

This is an open and shut case to me. Employee really has no leg to stand on until employed for 1 year. I wouldn't be worrying about labour courts either there are 60,000 waiting to be heard!
This is causing your business problems, it really has to be done and fast.

I have been in your position before and it is a tough decision but must be made if you feel this person is beyond hope.

knipex

Sonnenblumen wrote: »

Did you provide the employee with a Employment contractds which amongst other items clearly specifies duties, responsibilities etc etc. If not you could be in big trouble no matter how unsuitable the employee is. Seems to me, there was inadequate supervision, afterall, it is the manager's role to supervise all employees especiallly new ones.

This is far from black and white and I would speak to a HR specialist, ignore maverick rambo type 'fire them' advice, because a sniff of unfair dismissal is all that is required and you'll end up before the ETA and paying 5 fig penalties.

Proceed with caution and if you do decide to part, try and reach a reasonable settlement.

The role was explained clearly in advance and outlined. As I am not an accountant supervision was performed by an external accountant for the first 6 months and her work was reviewed regularly. Support has always been available at the end of the phone and any requested training provided.

I have spoken to a solicitor and no employee has protection from unfair dismissal during the initial 12 month period unless they are pregnant or are being fired as a result of union activity. In this case neither consideration applies.

I have fully accepted that I have to accept a portion of the blame for what has happened but the person applied for a role that was plainly outside their expertise, they lied about their experience and then when they got in trouble instead of asking for help tried to hide the issue and fudged the numbers to make them work. For that I have no sympathy, if they had come to me earlier when they realised they were out of their depth things were quieter and we could probably have done something about it but it is now to late.

Once the review comes back i will see how bad things actually are and make my decision then.

AndyJB

Hello Knipex,
You've covered all the problem areas in your OP. So, for the sake of your business and your head don't prolong the inevitable any longer.

Some of your points are as follows...

a) "I then pulled out the budget and forecasts for the previous 3 months and found a number of errors. Projected revenue input as costs, costs allocated to the wrong areas etc."

b) "I have now organised a review of the entire years accounts. (at significant cost)"

c) "They are in completely over their head."

d) "I have spent the weekend thinking about it and I really have no option but to lay the person off."

e) "We are a start-up struggling to break even this year......"

Don't wait any longer act immediately!

If you need a temp accounts body to get you back on track very quickly contact an agency or your auditors should have a person or two they could suggest.

BTW When you sit the person down, have someone else with you as a witness and to document minutes. If individual wants something in writing say you'll get back to them.

Best of luck!

Sonnenblumen

buck65 wrote: »

This is an open and shut case to me. Employee really has no leg to stand on until employed for 1 year. I wouldn't be worrying about labour courts either there are 60,000 waiting to be heard!
This is causing your business problems, it really has to be done and fast.

I have been in your position before and it is a tough decision but must be made if you feel this person is beyond hope.

This is the kind of Rambo speak that gets ALL employers a bad name. If you have been in similar siutations, you have hardly learned from same, in which case I doubt you were ever there? I believe the courts are always busy dealing with people sharing views similar to your own.

Lets see what the OP eventually decides to do.

DubTony

Unfair dismissal is never an issue until an employee has been with a business for 12 months +

You need to provide a reason as to why you are terminating the persons employment. It seems to me you have that reason. Inability to do the job hired for / incompetence.

Here's what Mrs. DubTony advises. FYI, Mrs DubTony has several years experience as a HR Manager in both large and small operations, both unionised and not unionised.

"Have a meeting with the employee, discuss the problem, go away for a day or two and then go back with your decision."

You have to be seen to afford the employee natural justice. Legally, the only thing you have to worry about is the employee taking you to court. NOT a tribunal, but a civil court, where he/she risks losing and having to pay costs.

Just be aware of the Minimum Notice and Terms of Employment Act

DubTony

Sonnenblumen wrote: »

This is the kind of Rambo speak that gets ALL employers a bad name. If you have been in similar siutations, you have hardly learned from same, in which case I doubt you were ever there? I believe the courts are always busy dealing with people sharing views similar to your own.

People get fired every day for their own stupidity. The only thing we as employers have going for us is that we can get rid of them within 12 months without worrying about legal hassles. As to what gets employers a bad name? Read this thread. Thankfully morons like this are few and far between.

buck65

Sonnenblumen wrote: »

This is the kind of Rambo speak that gets ALL employers a bad name. If you have been in similar siutations, you have hardly learned from same, in which case I doubt you were ever there? I believe the courts are always busy dealing with people sharing views similar to your own.

Lets see what the OP eventually decides to do.

Call it Rambo speak if you will. But to me the employer is not protected at all in this country and if someone is not doing their job they should be got rid of in the first year after that you are looking at compensation or redundancy.
Re the " I doubt you were ever there" bit , I have been managing a company for the past 5 years and have come up against many different scenarios with employees, especially since the downturn. Unfortunately I have been educated very hastily in the reality of employment law.

Sonnenblumen

buck65 wrote: »

Call it Rambo speak if you will. But to me the employer is not protected at all in this country and if someone is not doing their job they should be got rid of in the first year after that you are looking at compensation or redundancy.
Re the " I doubt you were ever there" bit , I have been managing a company for the past 5 years and have come up against many different scenarios with employees, especially since the downturn. Unfortunately I have been educated very hastily in the reality of employment law.

I agree employers appear to be at the losing end when it comes to dispute resolution, handling difficult employees or indeed terminating contracts when there are clear breaches. Legislation is also heavily biased away from reasonable employers in favour of unreasonable employees.

Its a part of business life that can make life hell I'm sure, and no more so than in the current climate.

PS ISME can provide useful asssistance and perhaps more on HR / employment law etc.

Cheeble

Hi,

You're taking a big risk, and IMO making a mistake by posting here with sufficient information in your OP for anybody close to the company to be able to identify the circumstances and the individual concerned. If they had any doubt, then your second post would confirm it.

You are openly discussing a highly confidential performance and disciplinary matter with the barest of anonimity for the individual concerned.

Take professional advice in confidence, and keep the matter between you, your adviser, and the employee.

Cheeble-eers

tombull82

Cheeble wrote: »

Hi,

You're taking a big risk, and IMO making a mistake by posting here with sufficient information in your OP for anybody close to the company to be able to identify the circumstances and the individual concerned. If they had any doubt, then your second post would confirm it.

You are openly discussing a highly confidential performance and disciplinary matter with the barest of anonimity for the individual concerned.

Take professional advice in confidence, and keep the matter between you, your adviser, and the employee.

Cheeble-eers

Cheebly is probably correct with this. Maybe go edit out alot of the info in the posts referred to anyways as you've not been quoted on them YET!!

Everyone posting knows whats happened anyway

knipex

Cheeble wrote: »

Hi,

You're taking a big risk, and IMO making a mistake by posting here with sufficient information in your OP for anybody close to the company to be able to identify the circumstances and the individual concerned. If they had any doubt, then your second post would confirm it.

You are openly discussing a highly confidential performance and disciplinary matter with the barest of anonimity for the individual concerned.

Take professional advice in confidence, and keep the matter between you, your adviser, and the employee.

Cheeble-eers

Thanks for the reply.

I have been very careful posting to ensure that none could even begin to guess the company. A few details have been changed in the post (nothing really relevent to the discussion) to ensure that is the case.


However I would go back and edit the post to remove allot of detail but I am not allowed.

So if a MOD reads this......