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UK business leaders cite high concerns about the risk of employee litigation in coming months, driven by changing working patterns as employees are asked to return to the workplace
- A third of office employees (32%) haven’t been in the workplace at all since March 2020
- Many business owners (25%) say they are uncertain that they can demand employees return, with a similar number (23%) reporting that their employees contracts don’t stipulate they need to work from a specific location
Research by Gallagher amongst 1000 business leaders and 1000 UK office employees, found that most businesses are suggesting that workers should be in the office full-time (40%) now or in the near future or a minimum of part-time (39%), as they implement a hybrid model.
However, a third of business leaders (32%) say they are meeting resistance from their employees towards returning to the workplace even part-time. With one in four (25%) businesses uncertain if they can insist their employees return, business leaders fear an impending wave of complaints and potential litigation from their teams, who claim they are just as effective when working from home.
Overall, almost half of business leaders (44%) report that employee litigation in the year ahead is a major risk to their business, with complaints due to asking employees to come back into the workplace post COVID-19 (37%) the top concern. This is followed by other potentially sensitive topics related to the pandemic including complaints due to mandating that employees are vaccinated (31%), or because leaders are challenging workers who say they need to self-isolate but aren’t being truthful (31%).
While many companies will have the law on their side as their contracts will state a place of employment, just under a quarter (23%) report that their contracts don’t stipulate that employees need to work from a specific location, while a further 9% don’t know if they do. Meanwhile, one in eight (12%) businesses are reluctant to enforce contracts and risk damaging employee morale.
Some companies have already taken a firm stance, with 19% of businesses saying they have terminated an employee’s contract due to a refusal to come into the workplace, while a further fifth (20%) have threatened to do so. With more conflict on the horizon, a further 18% expect they will need to issue demands to their workers to get employees back into office.
Employers have a number of reasons for making the effort to get staff back into the workplace. Chief among the motivational factors is the feeling that workplace culture suffers with home working (31%). Businesses also remain split over whether they operate equally well (29%) or less efficiently (26%) with employees working from home.
In terms of litigation, employers also expressed concerns about a knock-on effect due to the legacy impact of COVID-19 on the labour market. Most business leaders (58%) say they are worried about how they resource their workload due to staff turnover and sickness levels – which explains why 20% expect complaints or litigation related to stress due to overwork or pressure.
Commenting on the findings, Neil Hodgson, Managing Director of Risk Management at Gallagher, said: “The return to workplaces is a complicated task for senior leaders at UK businesses. Keeping everyone happy can be challenging, and while some employees feel that they have no need to be in the office, there is an awareness that leadership needs to implement policies consistently. But many businesses remain uncertain just how far they can legally mandate the return to workplaces – leading to concerns about litigation and complaints.
“Even when businesses are sure they are on safe ground with enforcing the return to workplaces, there is always the risk that attempts will be made to fight the decision. The fact is that employee litigation has been on the rise for some time and disagreements as a result of COVID-19 are likely to further exacerbate the issue. No company is immune to it and the costs of defending employee claims can devastate a business. Unfortunately legal fees may need to be paid even if the claim is unsuccessful, which is why it is important to have insurance in place that will cover these costs.
“Businesses should speak to their broker about employee practice liability insurance that will cover costs as a result of certain legal disputes with employees. When a company’s workers claim their legal rights as employees have been violated, this can protect against resulting litigation, including claims of discrimination and wrongful termination. Furthermore businesses can potentially head off any claims by speaking to an insurance broker who can provide risk management advice to guard against any potential claims and mitigate any possible employee concerns about returning to the office.”
