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Organisations need formal written documents, such as policies and procedures, to ensure robust governance and to effectively communicate standard organisational ways of working. These policies aim to provide a framework for all employees, contractors, workers and others who provide a service for, or on behalf of, the organisation to clarify strategic, operational and legislative requirements and obligations, and ensure consistency within day-to-day working practices.
What are HR policies?
All organisations will have individual categories of policies and procedures comprising relevant policies depending upon their business sector.
- Operational / Ways of Working policies.
- Public / Customer policies.
- Information Technology / Security policies.
- Human Resource (HR) policies.
HR policies and procedures are a fundamental and often a regulatory part of people management for any organisation with employees. They provide the guiding principles on the approach and intent of the organisation concerning people management and the organisation’s responsibilities under employment legislation.
They also provide guidelines for employees’ legal and regulatory compliance, set out the approach that the organisation and its management will take in HR matters, and provide employees with details of their rights, responsibilities and obligations.
What are the HR policies of a company?
Most HR policies and procedures are derived from relevant employment legislation and workplace good practice, and include requirements that must be adhered to if the organisation is to comply with its legal and ethical responsibilities.
Employment rights in the UK are covered in various Acts, regulations and laws that govern the employer and employee relationship, and include trade union relationships where applicable. They are designed to protects employees’ rights while also safeguarding an employer’s interests, and to keep the relationship between the two fair and transparent.
These laws provide legislation on, for example, dismissal, holidays, pay, discrimination and more. Employers have a duty to abide by employment law and failing to comply with the law properly may bring about a violation of employee rights, and may result in employees bringing claims to an employment tribunal.
Employment law in the UK covers a wide range of issues relating to the work environment and work processes.
Some of the most important pieces of employment law legislation include:
- Health and Safety at Work etc. Act 1974 – Employers have a legal responsibility to make sure that they provide a safe working environment. This may include carrying out risk assessments, offering staff training, and providing adequate safety equipment.
- Employment Rights Act 1996 – This is a comprehensive Act covering all employment rights including contracts, unfair dismissal, parental leave and redundancy, and was introduced as an update to older labour laws in the UK.
- Employment Relations Act 1999 – Establishes a number of rights at work, for example trade union recognition, derecognition, industrial actions, the right for an employee to be accompanied in a disciplinary hearing and the right to maternity leave and time off for dependants.
- The Equality Act 2010 – An Act that prevents discrimination in the workplace and the recruitment process. It identifies protected characteristics that cannot be used as a reason for any workplace decisions, unless it is a decision to make suitable arrangements to accommodate them in the workplace.
- Maternity and Parental Leave etc. Regulations 1999 – This outlines the rights to maternity and parental leave for employees.
- Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000 – This requires that employers give people on part-time contracts comparable treatment to people on full-time contracts who do the same jobs.
- Transfer of Undertakings (Protection of Employment) Regulations 2006 – TUPE regulations protect employee rights during a business transfer, for example if a new company has bought out an existing company.
- Agency Workers Regulations 2010 – Statutory legislation that prevents discrimination of people who work for employment agencies.
- The Parental Bereavement (Leave and Pay) Act 2018 – This gives all employed parents the right to 2 weeks’ paid leave if their child aged under 18 dies, or if they have a stillbirth at 24 weeks or later.
- National Minimum Wage Act 1998 – By law, UK employers must pay the minimum wage, which varies depending on age and also increases each year.
- Data Protection Act 2018 – This is a national law complementing the General Data Protection Regulation (GDPR) and Data Protection Act 1998. It regulates how organisations store employee information.
- The Working Time Regulations 1998 – This is generally thought of as health and safety legislation, but it still contains important rules that organisations should follow, particularly the working hours and holidays that employees are entitled to.
HR policies need to reflect the individual workplace, and the policies that are required will depend on a number of factors such as the size, location, industry and the unique needs of the organisation, as well as the make-up of the workforce. There are some HR policies that are required by law, which are detailed later in this article; however, the majority of HR policies are developed and implemented at the discretion of the employer.
To identify the HR policies that an employer may require, the first step is to undertake a risk assessment of situations that may arise in their particular workplace. Employers should be proactive about mitigating risks to their organisation, and by developing HR policies that clearly state the employer’s approach, rights, obligations, responsibilities and expectations, as well as the employees’ rights and responsibilities under that particular policy, the employer is safeguarding both the organisation and its employees. HR policies and procedures should be transparent and applicable to all employees regardless of their status within the organisation.
A HR policy document should set out who the policy is applicable to, the purpose of the policy, and any definitions of the terms used in the policy, and will then go on to discuss the policy in detail and the procedure to be followed. All HR policies and procedures must comply with employment legislation; however, some organisations may offer benefits that are better than those stipulated in the legislation, where they can afford to do so.
Some of the main HR policies that are not specifically required by law but are good employment practice to develop and implement include:
- Equality, Diversity and Inclusion policy – Should set out the organisation’s commitment to equality in matters such as recruitment, promotions, working practices etc.
- Dignity at Work / Bullying and Harassment policy – Having this policy in place can help show that all reasonable steps to prevent such behaviour have been taken by the organisation.
- Sickness policy – This helps deal with sickness absence among employees, including sickness reporting, prolonged absence and sick pay.
- Maternity and Paternity / Parental Leave policy – This outlines the employer’s responsibilities and the employees’ entitlements during pregnancy and following the birth.
- Recruitment / Safer Recruitment policy – This outlines the organisation’s commitment to fair and safe recruitment practices.
- Training and Development policy – Having this policy ensures that employees know what training and development is required for their roles and how the organisation will support their development.
- Redundancy policy – This outlines the approach that an organisation will take in the event of having to make redundancies and should outline employees’ entitlements.
- Capability & Performance Management policy – This policy should be separate from the Disciplinary policy as performance issues should be addressed prior to any disciplinary or dismissal actions being considered.
- Reward (pay and other benefits) policy – This outlines the organisation’s approach to pay, pay increases, benefit entitlements etc.
- Leave policy – This policy should detail paid annual leave / vacation entitlements and request procedures, also any special leave entitlements, for example for health appointments etc. if applicable.
- Retirement policy – This policy should outline the employees’ retirement and, if appropriate, pension rights.
- Code of Conduct policy – This policy sets the standards of behaviour that employers expect from their employees. These standards include things such as dress code, mobile phone use, use of organisation’s property, punctuality, etc. A Code of Conduct policy outlines behaviours that are not acceptable to the organisation and how these behaviours will be dealt with if they arise.
Recent events and changing workplace attitudes have introduced a number of new HR policies to employment good practice. These include:
- COVID-19 policy – This policy should detail the employer’s and employees’ rights and responsibilities during the COVID pandemic and beyond into new working practices of living with COVID.
- Flexible, Home and Hybrid Working policy – This policy details an organisation’s approach to permitting employees to work in alternative places to the workplace.
- Mental Health policy – For some organisations this is integrated into either the Health and Safety policy or into a stand-alone Wellbeing policy.
- Menopause policy – This is a new proactive addition to the HR policy portfolio and is being considered for development and implementation by many farsighted organisations.
HR policies and procedures must be realistic, meaningful and something that employers are prepared to uphold. They must also be clear, written in a language that everyone can understand and communicated to all employees, because unless employees understand a HR policy, their rights and their responsibilities, employees will think that HR policies are unimportant, which will make them near impossible to implement.
When HR policies and procedures are adhered to by both employer and employee, operations run smoothly, and people management becomes less stressful and less problematic.
HR policies and procedures do not have to be lengthy or complicated documents. They do, however, need to follow a structure and should include the following information:
- The policy title.
- Effective date of the policy (and dates of any revisions or updates).
- Policy executive owner and operational owner.
- A policy statement – This summarises what the policy is about and its purpose.
- Commitment – This details the organisation’s obligations and responsibilities.
- Scope – This should detail all the people the policy applies to.
- Legislative context – This should detail the laws that govern this policy and any other relevant polices that apply.
- Definitions – This should detail any terms used in the policy that need an explanation to ensure collective understanding.
- Roles and responsibilities – This section details who is responsible for what and any procedures that should be followed and any key contact details.
- Monitoring and reviewing – Details of when the policy will be reviewed and by who.
Who is responsible for HR policies in a company?
The responsibility for developing HR policies and procedures varies somewhat based on the size and structure of an organisation. HR professionals often play a role in developing and formalising HR policies and procedures, particularly in larger organisations who have their own HR function. However, many smaller organisations may use external HR consultants or download and customise templates from reputable providers.
Usually, a HR policy will have an executive owner and an operational owner. The overall responsibility for policy compliance rests with the executive owner; this is normally the senior management of the organisation. The operational owner has responsibility for the policy implementation, ensuring that employees receive training on the policy so that they understand their roles and responsibilities. They are also responsible for reviewing and updating the policy(s).
Managers and employees have responsibilities to comply with the HR policies. In many organisations, failure to comply with HR policies is a disciplinary issue.
What HR policies are required by law?
In the UK there are only three HR policies that organisations are required to have by law. These are:
- Health and Safety (if the organisation employs five or more people).
- Disciplinary and dismissal.
If an employer has five or more employees, a written Health and Safety policy is mandatory. This policy deals with a number of health and safety workplace issues, including accident reporting and what to do in case of a fire. The Health and Safety policy must set out the employer’s commitment to reduce risks and observe legal duties relevant to the workplace and its business. It will also set out what employees’ duties are in relation to health and safety and how they can meet these obligations.
All employers must, by law, have written disciplinary rules and procedures set out in a Disciplinary policy to deal with employee performance and conduct, and they must inform their employees about these rules and procedures. The policy must say what is acceptable and unacceptable behaviour in the workplace and what action the employer will take if the rules are broken, and should clearly state when someone might face disciplinary action and what that action could be.
A Disciplinary policy should be a step-by-step process that ensures fair and appropriate treatment happens, and it should follow the ACAS code of practice on disciplinary and grievance procedures. Whilst this code is not a legal requirement, it is considered good practice and it mitigates risks of unfair dismissal claims and employment tribunal rulings against the organisation.
It is the employer’s choice whether or not to make the Disciplinary policy contractual; however, employers should be aware that if it is contractual, i.e. part of the employee’s employment contract, then the employee could make a breach of contract claim against the employer if they do not follow their own policy and procedures in disciplinary matters.
By law, employers must set out a grievance procedure and share it in a written policy with all employees. If employees have an issue in the workplace, they need to know who they are meant to discuss this issue with. A Grievance policy acts as an important tool for employees to understand what steps they should follow when making a complaint and it clearly outlines the steps that the organisation should take when dealing with the complaint.
Employers do not have to include information about the Grievance policy and procedure in employment contracts; however, if they do, they must follow the procedure, or the employee could bring a breach of contract claim against the employer. This policy should also follow the ACAS code of practice on disciplinary and grievance procedures; whilst this code is not a legal requirement, it is considered good practice.
Why have HR policies and procedures?
HR policies provide all employees with a sense of security as they have a formal reference to the expectations that the organisation has of them in the workplace, and the responsibilities and approach that the organisation will take in various people management matters.
Well-written HR policies give managers and employees guidelines and a consistent, fair and legal way to deal with problems and issues without having to constantly involve HR every time they need to make a decision. They establish a structured and organised work environment, eliminate uncertainty in the workplace and define the ways to handle many of the people management issues that frequently arise.
HR policies also help to protect the organisation in HR legal issues such as employment tribunals, as they safeguard, regulate and clarify the rights and responsibilities of the employer and its employees.
The relationship between employers and their employees is the basis of any successful organisation. From recruitment, through employment contracts, working conditions, pay, grievances, entitlements to sickness, leave, parental leave, business takeovers, employee relationships and finally to an employee’s exit, Employment Law affects every single employee’s experience in the workplace.
It also crucially sets the standards that HR and leadership teams must follow when it comes to managing matters that impact employees, which is why robust HR policy development and implementation is so important.