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EMPLOYEE DOING OWN CLIENTS TAX RETURNS AT WORK - ADVICE REQUIRED

Hi there.

I have recently found evidence showing that one of our employees has been filing tax returns for his own clients whilst at work. We have verbally warned him in 2007 about this. We are a small practice who would need to replace this person straight away and are not sure how easy it would be to do this given the current climate

Just wondered if anyone else has had any experience in dealing with this sort of situation. He has been with us for over 20 years and has no written contract of employment. He does work alongside a sub contractor and we feel that if confronted he would say it was them.

At a loss as to how to proceed.

Any thoughts and comments would be appreciated.

Joan

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29th Jun 2011 16:08

No written contract

Doesnt't help your position much, as you are immediately on the back foot from an employment law perspective.

Also, if he leaves - how many clients will he take?

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29th Jun 2011 16:22

Estimate the time spent

then give him an invoice at his charge-out rate!  See if he dares to question it.

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29th Jun 2011 16:30

Online submission

Does he have access to the emailed HMRC submission acknowledgement? If so, is he deleting them?

If this should be the case, then maybe preventing him accessing the emails will solve the problem as he will know the 'game is up' when acknowledgements are received for an unknown UTR.

This is assuming you would like to keep him on, but just don't want him doing his own work during office hours.

 

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29th Jun 2011 16:34

REALLY TOUGH DECISION

Yes he does have access to the emails and has been deleting them all but we have found his files with all the emails and his workings in them.

With regards to him not having a written contract, is it really that bad? I thought it was not a requirement for employers with less than 20 employees. Also he is only 2 years from retiring so I don't think he would take any clients with him.

Struggling with both the personal position ie been here a long time and also the anger at finding out what has been happening again but know that I need to do things properly in order to avoid any comebacks.

Help much appreciated.

J

 

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29th Jun 2011 16:47

HR issue

Sorry to sound boring but you should contact an HR person and do this properly.

The contract is almost, as I understand it, irrelevant, an HR lawyer will confirm, the fact he has been with you 20 yrs is enough.

As he has been warned before it is even worse. You may find that as long as you have proof - eg submission logs from your tax software - that would be grounds for immediate dismissal for gross misconduct

again over to an HR lawyer on that one.

Just make sure you have copies of all the evidence before he/she deletes/removes the proof

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Verbal warning ...

 what did you say? How long was the warning in place for? What consequences did you threaten?

 If the same offence only merited a verbal warning last time then you will be pushed to move beyond a written warning this time. If you were to dismiss then almost certainly you would have failed to follow a fair process and the tribunal would get to decide (in the absence of a contract - Doh!) what a fair process was. If the tribunal decided this was a case of unfair dismissal then the penalty could be quite large as the guy is unlikely to find work again at his age ... so you are looking at 2 years pay as compensation.

My advice ... get some advice ... about how to follow a fair disciplinary investigation process and go from there. Written warning and bide your time until he has retired!

 

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By DBlood
29th Jun 2011 18:45

Is it really worth all the hassle ?

 

 

Looking at the facts (as far as we have them) -

He is filing private client returns from your officesHe's worked there for 20 years, so presumably there are no other problems with his work.He's 2 years from retirement.Apparently you spoke to his 4 years ago about a similar matter (a 4 year old warning means nothing - a bit like a spent conviction it "never happened" - and would be ignored by a tribunal).Assuming his work is up to date and acceptable exactly what harm is he doing ?  Are you sure he's not doing it in his lunch breaks (ie when not being paid by you).

Why don't you simply chill out, and in 2 years he will be retired. The alternative could be an expensive employment tribunal, and who knows what they might award ?  

Take a tip from more progresive firms like Google where staff have one day a week to work on any project they like, even provate projects. 

Life is far too short to get all worked up over something so insignificant and unimportant.  Do you strip seach employees to see if they've nicked a biro too ?

 

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By Tosie
29th Jun 2011 19:21

agree with dblood

Why not discuss the situation with him and say how annoyed you are. Suggest that the clients become part of the firms clients and pay him a small fee for bringing them into the practice or ask him if he wants to become a sub contractor instead of an employee.

I suspect that any legal redress would be slow in coming and very expensive. If he does the work in his own time you are not losing anything more that the cost of the power used.

You are not alone in this situation I know that it has happened in my firm but the employee was valuable and his work brought in ten times what we paid him so we just let him get on with it. In fact he used to ask advice regarding his personal clients.

 

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By BKD
29th Jun 2011 20:33

"you are not losing anything more that the cost of the power use

Not necessarily. If the employee is fling returns online, under the firm's agent reference, and his work is not up to scratch, the firm's reputation with HMRC could be damaged (particularly relevant in the midst of the discussions about agent registration and monitoring).

But if he's filing under his own reference and/or you're satisfied with his work (after 20 years' service, I guess that is the case) I would express my disappointment at him not having heeded previous warnings and leave it at that. Stick rigidly to the rules and you'll end up with an unhappy workforce.

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By geoffmw
29th Jun 2011 20:44

In t5he present Climate

In theory a replacement w32ould b e easier to find. Or do you mean that if dismissed he would find it harder than usual to find another job?

I agree that if his work is otherwise satisfactory just let him know youy are aware of the situation.

The real pronblem you could have is that if he thinks it ethical to do what he's doing, how does he view a similar vsituation if hhe spots it at one of your clients

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By DBlood
29th Jun 2011 22:53

.

Not necessarily. If the employee is fling returns online, under the firm's agent reference, and his work is not up to scratch, the firm's reputation with HMRC could be damaged

 

Posted by BKD on Wed, 29/06/2011 - 20:33

 

If he's worked there for 20 years and "his work isn't up to scratch" then I think they have more to worry about than a few extra clients being filed under their reference.   

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30th Jun 2011 11:01

Legally

I think you are treading in dangerous water. As stupid as it sounds I believe you are not legally entitled to go snooping through an employee's emails unless it is specified in a contract about privacy for example.

The guy is two years from retirement and if you acted then I would be of the opinion that you couldn't automatically dismiss him for his behaviour. If he is to receive a final warning then a bad atmosphere would be created and your team would suffer. He could also choose to leave and take clients for his retirement or sue for constructive dismissal.

My advice would be to introduce contracts for all your staff at this moment in time. You want to protect yourself that your employees may take business with them if they leave for example. In addition, I would include the privacy element above and also state in the contract that at no time is an individual allowed to use office time/resources for their own work.

The employee will read between the lines I guess and hopefully the behaviour will stop at this point. If not then you will be better placed to act with a contract in place.

 

 

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By lenny
30th Jun 2011 13:31

Contract not needed

I dont think you need to go as far as a contract, just issue a notice stating the company policy on fair use of the internet for work related issues only, and state the consequencies of not abiding by the rules, this will need to apply to all employees.

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