My employee won’t follow instructions, what can I do?

Employers often shy away from dealing with difficult or disruptive employees, not wanting to have difficult conversations about poor performance or bad behaviour, but disruptive employees can be a thorn in the side of companies, often causing conflict between staff members as well as affecting morale and performance.

The reality is that ignoring staff issues will only prolong matters and not make them disappear.

At ACUMEN BUSINESS LAW our philosophy is to deal with issues as early as possible. There are certain rules and procedures that should be followed when dealing with staff issues and it is important to deal with matters in accordance with those rules. Whilst there might be ways to get around the ‘rules’, there is no better way to fix a problem than to deal with it head on.

Unlike the Alan Sugar method of hiring and firing, in the majority of cases you can’t simply dismiss an employee for poor performance or misconduct without following certain procedures. These procedures can take time, sometimes lasting 6 months or more. However, by addressing problems early you will ensure that, in the event a situation is not resolved or becomes untenable and you are contemplating dismissal, you will already be some way down the required course of action and will not be faced with having to start a potentially lengthy process from the beginning.

When considering the behaviour of an employee, you will usually be able to refer to their employment contract which may contain obligations on the employee to comply with rules, policies and procedures. However, even if there isn’t a contract in place with such obligations, employees are subject to well established implied terms obliging them to obey the lawful and reasonable orders of their employer.

There is also a duty on employees to be adaptable. As with the duty to obey, many contracts will include an express clause which allows the employer to make changes; for example, to the employee’s duties, working methods or place of work. Again, even without such a clause, an employee cannot insist on doing their job in a particular way or even at a particular location as it is implied that an employee should be adaptable to the managerial directions of a company. It should be noted that such duty is subject to a test of reasonableness, particularly where an employer seeks to change an employee’s place of work (known as mobility clauses). An employer is not given unfettered discretion to move an employee wherever he chooses and it will only be reasonable if it can be justified for genuine business efficacy.

As the name suggests, implied terms are not expressly written into an employment contract but have developed through case law and are legally enforceable. Clearly, duties to obey, co-operate, work as a team, or not as the case may be, and generally be a productive and enthusiastic employee are vital for the effective management of any business and any term, whether express or implied, requiring employees to follow reasonable orders is necessary for the smooth running of a business.

Wilfully disobeying a reasonable order is a form of misconduct and should be dealt with in line with the company’s disciplinary procedures. However, care should be taken not to issue warnings or consider dismissal for relatively minor misconduct as this would be overly oppressive and subject to challenge. In the case of Alexander Russell plc v Holness the employee was given a written warning and then, on the following day, a final written warning, both for poor timekeeping. The tribunal found that this decision by the employer to issue a final written warning was a harsh decision, based on relatively minor misconduct, and held that it constituted a breach of trust and confidence by the employer.

Any decision based on an employer’s managerial prerogative under the duties to obey lawful and reasonable orders and to be adaptable should therefore be considered and restricted in light of the implied term of trust and confidence.

Trust and confidence is a well known implied term, particularly in the context of employment relationships. In essence, an employer must not, without reasonable and proper cause, conduct itself in a manner calculated and likely to destroy or seriously damage the relationship of trust and confidence between employer and employee. The reach of claims which could fall under breach of mutual trust and confidence is broad and covers any number of employment issues but, suffice it to say, where treatment is irrational or perverse, wilfully high-handed, or seeks to gain advantage from the
employer’s position of power over the employee, there is a risk that it breaches this implied term. In short, decisions based on disobedience should be handled with care and following strict policy on disciplinary matters. Overly oppressive decisions to remove an employee who is outspoken, disobedient and unruly may be subject to challenge for breach of trust and confidence.

In addition, disciplinary proceedings for disobedience may not be reasonable if it is not consistent with the nature of the employee’s job or terms of contract. An historic case of a highly-paid buyer (of lace) who did not comply with an instruction to perform a manual task in a warehouse was not held to be under the duty to obey as that particular order was not within the character of the job for which he was employed.

However, the Employment Appeal Tribunal confirmed, in the recent case of Cotter v. Point Grey Golf and Country Club, 2016, that where an employer has issued directions that are lawful and not dishonest, it will amount to insubordination if those directions are disobeyed. The Court in this case also noted that an employer will have just cause to dismiss an employee where the employee has been insubordinate and wilfully disobedient to the employer’s orders in a matter of substance, to the extent that the employer loses trust in the employee. In this case, Mr Cotter, the golf club’s financial controller, was defiant in his opinion that the company had filed incorrect tax reports which created a liability for his employer and sought to resolve the issues by communicating with both employees within the golf club and also with external parties. Mr Cotter had been given clear and concise directions from the company, including legal opinions and assessments from relevant authorities that the matter was not contentious but he still persisted in his view that it was incorrect. After 2 ½ years of conflict he was dismissed for cause. Mr Cotter claimed for wrongful dismissal and punitive damages in excess of £1 million. The court, referring to a previous case, said just cause for insubordination is established where “the conduct complained of is such as to show the servant to have disregarded the essential conditions of the contract of service. It is no doubt, therefore, generally true that wilful disobedience of an order will justify summary dismissal, since wilful disobedience of a lawful and reasonable order shows a disregard – a complete disregard – of a condition essential to the contract of service, namely, the condition that the servant must obey the proper orders of the master”. In this case, the court held just cause was established and dismissed Mr Cotter’s claims.

If you consider that you have good reason to discipline for disobedience, and the insubordination is sufficiently found, you should follow the guidelines set out in the ACAS Code of Practice on Disciplinary and Grievance Procedures (Acas Code) which applies to cases of misconduct. This is important to mitigate the risk of a claim of unfair dismissal for failure to follow the correct procedures. This claim is only available to employees with more than two years service, although there are other valid claims available to employees with less than two years service, so it is advisable to seek legal advice before deciding to disregard formal procedures.

A vital thing to remember is how important it is not to jump to conclusions about an employee’s conduct without some investigation. There may be underlying reasons why an employee is being difficult which could include being bullied at work, having personal problems or having been diagnosed with an illness.

As a starting point, we always advocate an informal discussion with the individual to discuss your concerns about their conduct. You may uncover an underlying reason for their behaviour which needs to be handled in a different way, for example, if they are ill. It may be the catalyst for them to improve their behaviour or, if they are not happy at work, to move on voluntarily. Be careful; if the informal discussions result in giving a warning in writing, this could be construed as a formal disciplinary action which would require certain procedures to have been followed. Keep a record of the meeting but note that it shouldn’t be used to make decisions about future disciplinary matters.

If the informal approach fails, or the conduct is serious enough to warrant formal disciplinary procedures, it’s important to ensure you act fairly in those procedures to reduce the potential for an unfair dismissal claim. This will require a fair and balanced investigation, preferably by someone other than the person who will conduct the disciplinary hearing, although in smaller companies this will not always be possible.

The level of investigation will depend on the circumstances of the case. For conduct matters this may involve taking evidence from line managers and colleagues or reviewing the employee’s work. It will usually involve meeting the employee in question; they may provide a reasonable explanation or point to documentary or witness evidence in support of their case. Remember that investigation meetings are to decide if the matter warrants formal action and do not constitute a disciplinary hearing. As such, the employee has no legal right to be accompanied, although you may choose to provide them with the option to have a companion present.

The investigation must not be a witch hunt; you need to consider evidence in support of the employee as well as against. Overall, you should take a fair and balanced approach to all proceedings.

If, after an investigation, you decide that there are grounds to warrant formal action, you should invite the employee, in writing, to a formal disciplinary hearing. At this meeting the employee has a statutory right to be accompanied but only by a colleague or a trade union official. They are not permitted to bring their own legal counsel, or any other person, but you should check if they need any reasonable adjustments or special requirements due to any disability. It would usually be considered excessive to instruct a solicitor to carry out the hearing; however, you should seek legal guidance and have someone present to take minutes. If the matter is complex it is advisable to also have an HR facilitator to oversee proceedings in an advisory capacity. The invite letter should set out the allegations in full and include all the evidence you intend to rely on at the hearing, including any witnesses. If dismissal may be a possible outcome this needs to be stated in the invite letter.

The disciplinary hearing should, where possible, be conducted by a person who has not been involved in the investigation or given witness evidence. Also consider that, preferably, a more senior manager is required to hold any appeal hearing.

After the formalities of the hearing have been covered, i.e. confirming the allegations, that the employee has the relevant documents and whether they need any assistance, the employee should be given the opportunity to make any representations, ask questions and produce or discuss documentary evidence.

You don’t necessarily have to call witnesses and can, instead, refer to statements where appropriate. Although, the employee should be allowed to call witnesses if they wish.
Once the employee has presented their case, the matters should be summarised for the record. When all parties have presented their case, and there are no further questions, the hearing should then be adjourned to consider what the employee has said.

It may be that further investigation is required and a reconvened hearing is necessary. Even if the company has an idea as to the decision it will make at the end of the hearing, it is always good practice to adjourn before any decision is communicated. This makes it less likely the matter will be seen to have been pre-judged.

If the nature of the misconduct could warrant dismissal, consideration must be given to whether there are any reasonable alternatives to dismissal such as demotion, redeployment or a final written warning. As discussed above, final warnings should not be used oppressively. It is usually considered fair to give two written warnings before deciding to dismiss an employee and it is worth considering what sanctions have been imposed on other employees in similar circumstances. ‘Live’ warnings on the employee’s personnel file can be taken into account but ‘spent’ warnings should not be taken into account. Except in cases of gross misconduct, employees should not be dismissed without any prior warning and any decision should be confirmed in writing.

Whether the outcome is a warning or dismissal, the employee will have the right to appeal the decision. This should be considered in a further meeting with the employee or, if appropriate, a reconsideration of the facts. Either way, it must be conducted by another manager who was not involved in the earlier stages, where possible. Any decision at the appeal is binding on the employee.

Other than in the very serious cases of gross misconduct, it will usually be inappropriate to dismiss an employee for failing to obey lawful orders without first having given at least one warning. An employer should always seek legal advice to discuss the individual circumstances of a case before deciding whether dismissal would be appropriate.