17 April 2019

Suspending employees: why you should avoid a knee-jerk reaction

Faced with a disciplinary complaint against an employee, an employer's first reaction is often to take what may be perceived as the fair approach, and suspend the employee until an investigation has been carried out. However, this may not be the safest way to proceed.

What should employers consider when deciding whether or not to suspend an employee, and if the employer decides it is necessary to do so, how should employees be treated during this period?

Do you have the right to suspend?

Before taking any further steps, you should consider:

  • Do you have a right to suspend in the contract of employment?
  • What does your disciplinary policy say about suspension: are there any particular steps you need to take?

If the contract of employment contains a right to suspend, then in most situations doing so will not be seen as a breach of the employee's contract.

However, where the contract is silent or where the employee has an implied right to receive work (such as variable pay reliant on work done, such as commission and shift premiums, or argues that they depend on maintaining a certain profile in order to work), a suspension where there is no clear contractual right to do so may be a breach of contract.

In such a situation an employer should be very careful before suspending the employee, as a breach of contract would mean not only a claim for damages but would mean that the employer was unable to rely on other terms of the contract such as post-termination restrictions.

Is suspension reasonable?

So you can suspend – but should you?

The risks involved in automatically suspending employees subject to disciplinary proceedings as a 'knee-jerk reaction', without giving sufficient thought to the matter has been highlighted in a recent Court of Appeal case (Lambeth v Agoreyo).

In that case, a teacher was suspended following several alleged incidents with children in her class. She resigned the same day and the Court of Appeal overturned the High Court's decision to find that there was no breach of the implied term of mutual trust and confidence.

Suspending an employee will not automatically give rise to a claim and the case clarifies the test employers should apply when making a decision to suspend.

However, the Court of Appeal did make it clear that this issue is very fact-dependent and if an employee is unjustifiably suspended, there is a significant risk of the employer in doing so breaching the trust and confidence that is implied into every employment relationship in the UK.

This will give rise to a potential claims by the employee, including constructive dismissal following a resignation (as occurred in this particular case) and discrimination.

Instead, employers should look at the circumstances on a case by case basis and examine whether there is "reasonable and proper cause" to suspend the employee, taking into account all of the available information.

For example, employers should consider:

  • What initial evidence is available in relation to the allegations? Before deciding to suspend, the employer must have carried out at least some preliminary investigations to satisfy itself that the allegations are not baseless. If limited evidence is available at the early stage, can suspension wait until more material evidence has been produced during the course of the investigation?
  • Is the suspension necessary? What objective are you trying to achieve by suspending the employee? Will having the employee remain at work involve some material risk to clients, to the business or to the investigation?
  • Is there another, less extreme way of achieving the same objective? For example, would having the individual work from home, working from a different location or putting in place clear restrictions regarding access to information or other employees offer the protection that the employer requires?
  • What effect the suspension may have on the employee? For example, will suspension likely have a material impact on the employee's reputation, either internally or externally, and how does this weigh up against the employer's interests?

An employer that has considered all of the above is less likely to be at risk of allegations of having made a knee-jerk reaction, and breached trust and confidence in the employment relationship.

Informing the employee

Once a decision has been made, you should inform the employee as soon as possible and follow up in writing, explaining:

  • that the employee is suspended but that it is not a disciplinary measure (it is no longer necessary to state that the suspension is a 'neutral act')
  • the reasons for the suspension (including why you believe it is necessary)
  • how long the suspension is expected to last
  • what the employee's rights are during suspension
  • the employee's point of contact during suspension (most likely either HR or their manager).

Avoid saying anything which suggests that you have already reached a conclusion on the allegations against the employee.

Length of suspension

Acas says that any suspension should be no longer than necessary, so you should conclude the investigation as quickly as reasonably possible.

In the meantime, the employee should be told of any delays to the process (as an extreme example a recent case, Uwalaka v Southern Health Foundation NHS Trust, involved an employee who had been suspended for nearly three years due to a failure to carry out a proper investigation).

If circumstances change and it is no longer necessary for the employee to be kept out of the business, the possibility of the employee returning to work, even in a limited capacity, should be considered.

Arrangements while on suspension

Unless there is a contractual right to suspend without pay, any employee who has been suspended is entitled to receive their full pay and normal benefits for the entire period.

It may be tempting for employers to look to take further steps regarding the suspended employee, such as removing their email access or taking their access pass.

Steps such as these are possible, but employers should think carefully before carrying them out. For each they should be confident that there is a specific and justifiable reason for doing so, rather than just as a matter of course.

Suspending an employee who is subject to disciplinary proceedings can serve as an important tool to employers to allow them to protect their business and investigations and will often be justifiable.

However, recent case law shows that suspending an employee is not a decision that should be done lightly or without proper consideration of why it is necessary and how it will be carried out. Failing to do this will present considerable risks for an employer and leave them open to employee claims.

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