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I run a small accountancy practice and have had recently an employee leave and wanted some thoughts. The person had been with me for 10 weeks only. There was no contract of employment in place just a detailed offer letter that was quite specific ' contract was too follow.

We had a dispute over the offer letter that caused friction. I received a text message (whilst out of the office) that this person was leaving for another job and wanted to start next week. This was on the Wednesday. I sent one back saying can we discuss it tomorrow when I am back in the office. The person was determined to leave and said could she leave that day (Wednesday) ' I said yes for various reasons. All by text initially and I eventually phoned the person up. No letter of resignation. A bad egg sometimes needs to move on or be moved on.

Is a text classed as a letter of resignation? Obviously very unprofessional!

There are wages owed according to the person (we disagree for various reasons and will in due course dispute). Can we withhold wages because of the lack of notice? We think not.

Also we employed the person from an agency and paid a fee on annual basis bearing in mind they only lasted we have heard that we could be due a refund on the basis that the annual salary was substantially lower.

This is an unusual situation and any thoughts would be appreciated

Andrew Smith

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By Neville Ford
06th Jun 2005 09:24

Be generous, it's cheaper in the long run.
Often I am approached by clients who have HR problems for advice on terminating staff. My advice is always the same - be generous in termination, both financially and tempermentally. I advise this primarily for one reason - its cheaper in the long run.

A dissatisfied or unhappy employee is a stragetic danger and an acute problem, especially in a small accountancy practice. Sloppy work or a bad attitude will lose you clients and even if you don't lose the clients the effects can keep resurfacing for years - especially if an enquiry arises.

If you are too concerned with not giving more than they are contractually entitled to you will cause yourself a lot of grief. As a minimum it will extend the period of conflict, absorbing time and preventing you getting on with fee paying work. At worst you could find yourself facing an employment tribunal, with the attendent costs and preparation time, which is costly even if the claim is dismissed.

As a small business with a very low staff turnover - if your turnover is a problem then start examining yourself - you are unlikely to set a precedent. Being generous, but not stupidily so, without admitting any fault ensures that if they do decide to start some from of proceedings against you they are unlikely to succeed.

The best policy is to try to avoid the situation in the first place. The best advice I received was not to recruit in haste and to lavish time and care on recruitment. Personally I avoid agencies, preferring to advertise locally and sort the applicants myself. It takes time and patience and at the time oftens seems a waste of time. In the past I have readvertised if there was no one that I was entirely happy with. But there are often nuggets in there, that would not fit an agency profile, but are worth their weight in gold.

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By listerramjet
02nd Jun 2005 16:57

for what its worth
Can't see any reason why LOR cannot be effective by text message, although both parties may struggle to produce this in hard copy?
Seems clear that you agreed an end date to the employment.
I would have thought that you would be obliged to pay wages up to the agreed end date, plus any holiday pay accruing etc.
I would also have thought that the offer letter would be binding in terms of any specific terms it mentions (such as holiday entitlement).
If there is a dispute as to wages owing I guess you could refuse to pay, and see what actions your former employee takes - but you may like to consider any adverse publicity this might create.
Professionally speaking, perhaps it is time to review your HR policies?

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By NeilW
02nd Jun 2005 18:11

Employment contracts are pretty much a waste of space from an employers point of view. If an employee walks out on you there is little you can do to recover costs. All you can do is not pay them their notice! If you withhold wages earned, you'll find yourself in front of an employment tribunal.

Under English law a breach of contract can at best result in a sum of damages for losses incurred which you have a duty to mitigate. By definition an employment contract is one where the master tells a servant what to do. Since, in the eyes of the law, you can simply get somebody else and tell them what to do, there isn't really any loss!

Next time you use an agent, negotiate the finders fee clauses. There are plenty of agents around, and they ought to take some of the employment risk if they want your business.

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By jonspe
03rd Jun 2005 12:11

Employment Contracts
I used to be a Sole Practitioner, with a few employees, until a few years ago when I moved on to other things.

When I read comments as in this case, I wonder
how on earth does the smaller accountancy practice survive today with all the attendant bureaucracy?

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By Blueveinedboy
03rd Jun 2005 12:55

Notice periods
From memory (so don't quote me on this!) if you haven't specified a notice period in the offer letter then I think the statutory amount is one week for every year worked. If the individual refuses to work the notice period then there are good grounds to only pay them for the time they have actually worked, plus any accrued holiday etc. If you told them you wanted them to leave immediately then you'll be liable for the notice period payment. In future you may want to consider including probationary periods in your contracts - we have a 3 month period whereby notice is 1 week either way within this and 1 month thereafter. Hopefully you ought to be able to sort the wheat from the chaff within that time period.
As for agencies, mostly the fee is based upon annual salaries. We again use the probationary period to reduce fees as we offer staff an initial salary for the first 3 months which increases by a set amount on successful completion of the probation. My advise is that if you are satisifed with the service you got from the agency discuss with them what happened and you may get a replacement free (if they want your continued business) or at a much reduced rate. I had someone leave after 7 weeks and the agency, rather than refunding part of the fee, hired a new employee for the same cost. Usually they offer this as it saves their bonus which they may lose if there's a refund and you go elsewhere!!!

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By neileg
03rd Jun 2005 13:11

Drives you mad, doesn't it?
I'll just emphasise some of the points already made.
1. You have no choice but to pay up to the date of leaving. If the salary level is in dispute, you should either pay what you think it should be and wait for the dispute or pay a higher sum on the basis of a letter of compromise. Either way, don't waste days of productive time arguing over a few hundred pounds.
2. Good agencies will be co-operative but don't expect any money back. Free services should be easy to negotiate.
3. Get your paper work in order. You need a set of standard terms and conditions that apply to all employees. You need a statement of individual terms for each employee which could be incorporated in the offer letter. Send them the standard T&C document at the same time. You need the employee to sign a copy of the offer letter and hold this on your files.

Good staff are assets, bad staff are liabilities. Look after your assets!

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By Anonymous
02nd Jun 2005 20:45

Awful
For what its worth cant we all do without this sort of employee!!! Running a practice is hard enough without individuals such as this!

Doesnt it make you wonder if agencies are worth while?

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By Elenderil
02nd Jun 2005 16:01

Boiler plate employment contract clauses
Where there isn't a written contract there are some clauses which are inferred by statute. The Dept of Works and Pensions or the DTi website will have details. These form the minimum terms and conditions that apply. They form the minimum enforceable obligations between employer and employee and will be a good point to start from in considering what obligations you have toward the departed employee.

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By Anonymous
02nd Jun 2005 14:27

Agency fees
I doubt you will get a refund on the agency fee. The fee is calculated on the equivalent annual salary. Look at your terms of business regarding refunds, but you are probably outside the refund period now. In any event it's not the agency's fault, unless they have found your employee another job!

If you are outside of the refund period you could try to negotiate a reduced fee for a replacement employee, but their TOB are usually robust and they will defend them to the death.

Good luck

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