Time to dust off your employment policies
The To-Do List
Things at the bottom of the to-do list often become the new year's good intentions. Time will tell whether they stay at the bottom of the list for another year or really do get tackled this time.
Reviewing employment policies is one of those tasks. It often remains something to be looked at when there is time and/or budget. However, there is some justification for pushing this task up the agenda and taking a critical look at what policies are in place and whether they work to the best effect for the employees and the organisation.
In Hong Kong, there is no clear legal obligation for an employer to adopt policies or create a staff handbook. In jurisdictions such as Korea, Taiwan and Japan, there is a legal requirement to adopt policies or "work rules" when a certain number of staff are employed. A failure to have a clear policy, for example a written disciplinary policy in China, can also put an employer at a disadvantage if there is a need to discipline an employee.
While there is no legal obligation here, employers who fail to implement clear policies increase their exposure to claims by disgruntled staff, particularly in cases of alleged discrimination. The Disability Discrimination Ordinance code of practice advises companies to adopt clear sick-leave policies and a grievance procedure. While not legally binding, it is highly persuasive and is admissible as evidence when a court determines whether an employer is potentially liable for alleged disability discrimination.
The Global Challenge
Many company policies are just not applicable in Hong Kong, and can be global, regional or multi-jurisdictional. This has become increasingly important as more companies adopt a global standard for conducting business.
One of the biggest challenges for organisations working across borders is how to approach the issue of policies. Should "one size fit all" or should local practice prevail? Clearly this depends on what is being addressed and the diversity of jurisdictions covered. However, there are some critical questions which, if considered at the outset, would ensure a policy review is properly approached.
The Crucial Areas
Employers should ascertain whether global consistency or the adoption of local standards is more important. They may adopt local minimum statutory standards for things like leave, benefits and termination payments, or apply a global standard - even if it exceeds local legal obligations or market practice.
They should consider how policies will work legally and practically, along with the other contractual documents. Will they be approached on a standalone basis or presented as part of a contractual package to staff?
Implementation plans should anticipate the need for collective consultation to make the handbook effective, as is the case in China. Given potential limits on changing the contents in future without consultation, how much flexibility should be built into the handbook itself? How does this sit with the need for clarity and transparency?
Employers should decide whether the documents are translated into a local language, and whether there will be staff who do not fall into the category of full-time employees - for example, part-time or flexible working arrangements, or consultants. If so, will they be covered by the handbook?
Is there a commitment to using the handbook as a tool for locally appropriate training (for example in India to meet recent legislation on sexual harassment protection for women in the workplace)? Who will "own" the handbook and make sure it is kept up-to-date and fit for purpose?
What are the biggest risks the company faces from its employees - such as taking confidential information to a competitor or reputational damage though inappropriate behaviour or conduct - in any particular jurisdiction? Does the handbook assist in mitigating those risks in the most effective way?
While working through this list of questions can seem somewhat onerous, once the answers are clear, any subsequent review project should be much more focused. Who knows, this might be one task that gets addressed before next New Year.