How to navigate senior employee departures and remain legally compliant

There have been a number of recent high-profile departures across industries ranging from technology and television to the automotive sector. Christian Horner, Gregg Wallace and John Torode, to name a few, have all been “let go”. Many of these exits have played out under intense public scrutiny, often involving serious allegations such as misconduct, sexual harassment, or abuse of power at the highest levels of leadership.

The departure of a senior employee, particularly in sensitive or contentious circumstances, requires careful navigation of both legal obligations and reputational risk.

We outline the key considerations for employers managing senior exits amidst allegations of misconduct to ensure compliance with employment law.

Employment law compliance

1. Do you have a fair reason for dismissal?

Where an employee has more than two years’ continuous service, employers must have one of the statutory potentially fair reasons for dismissal and follow a fair dismissal procedure, to minimise the risk of a successful unfair dismissal claim. Potentially fair reasons include:

• misconduct
• capability;
• redundancy; or
• Some Other Substantial Reason (SOSR).

Some Other Substantial Reason (SOSR)

• SOSR is a catch-all category which can be used to justify dismissal in situations that do not fall within the other lawful reasons referred to above.
• It can include issues such as reputational harm arising from an employee’s behaviour or involvement in a public scandal which makes continued employment untenable.
• However, employers should take care not to rely on SOSR where the dismissal is in reality for another reason, such as misconduct.

In all cases, employers should clearly document their reason for dismissal and retain supporting evidence.

2. Conduct a fair and independent investigation

• Procedural fairness requires a comprehensive and impartial investigation into any allegations before any decision to dismiss is made.
• High profile cases involving senior employees frequently have a complex factual background, so it may be worth considering appointing an independent third party to carry out a disciplinary investigation.
• This helps pre-empt common arguments from employees (or their legal representatives) such as the investigating officer being biased or insufficiently senior to assess the matter objectively.

3. Follow your dismissal procedure and the ACAS Code of Practice

• Most employers will have a disciplinary procedure.
• Employment tribunals will expect employers to follow their own policies and will be critical of those that don’t.
• Typically, disciplinary procedures are based on the ACAS Code of Practice on disciplinary and grievance procedures (the Code), which sets out the minimum standards for handling disciplinary matters; this is worth checking before taking any action to dismiss.
• An unreasonable failure to follow the Code can be costly as employment tribunals can apply an increase in compensation of up to 25% in successful claims.

4. Consider suspension carefully

• In serious cases involving allegations of gross misconduct, it may be appropriate to suspend the employee on full pay while the investigation is ongoing, however, suspension should only be considered as a last resort.
• Alternative options, such as redeployment, remote working, or temporary changes to duties should be considered in the first instance.
• If suspension is determined to be necessary, to protect the integrity of the investigation or the wellbeing or safety of employees for example, the rationale must be clearly documented internally, and the decision kept under regular review.

5. Support employee wellbeing

• Disciplinary processes, particularly where senior employees are facing allegations of misconduct, can be emotional and stressful for all those involved.
• Remember employers have a duty of care to safeguard the wellbeing of their staff throughout and this includes the employee under investigation.
• Consider what support mechanisms, such as Employee Assistance Programmes (EAPs), mental health resources and professional counselling services can be made available to all parties involved.

6. Settlement

• In cases involving senior, high profile personnel, employers may prefer to offer a settlement agreement to facilitate a mutually agreed exit.
• This can help avoid the costs, business disruption and uncertainty of a drawn-out disciplinary process and any subsequent employment tribunal claims.
• However, the timing of any offer should be carefully considered.
• Making a settlement offer too early may be perceived as a sign of weakness or lack of confidence in the employer’s position.
• On the other hand, in high-profile cases, exiting an employee under a confidential settlement agreement without a thorough investigation may fuel speculation internally, undermine trust in leadership, and damage organisational credibility.
• A carefully considered approach is therefore essential.

Reputational considerations

Reputational considerations can be key, especially where the employer and/or employee are high profile. In this context, a settlement is generally helpful, with sensitive aspects protected by confidentiality, and an agreed statement approved for public release. That this is not always the case is apparent from the recent high profile departures referred to above.

Hamlins Reputation and Privacy team has established itself as the advisor of choice for organisations as well as public and private figures seeking advice in relation to defamation, reputation management, pre and post publication libel and privacy law

How Hamlins can help

Our Employment team advises both employers and employees on all aspects of employment law, providing support and guidance on the full range of employment issues which arise during the employment life cycle, from recruitment through to redundancies, performance dismissals and executive exits.

If you are navigating any of the issues outlined above, please contact Penny Hunt, Head of our Employment team, or Cathy Fehler in our Reputation Management team to see how we can help you.