Consider Tribunal Insurance If Your Workers Hug It Out

February 2019

There is a fine line between workplace harmony and what is considered unwelcome attention and harassment, as evidenced in the recent friction between workers at fashion and accessories brand, Ted Baker, and the boss they felt to be too over-familiar.

Around 2000 employees within the Ted Baker corporation had, as early as December 3, signed a petition to demand an end to ‘forced hugging’ in the workplace.  Additionally, CEO Ray Kelvin’s behaviour in this regard led to other complaints.

A policy of hugging was introduced as part of Ted Baker’s corporate culture around 2 years ago, when Ray Kelvin stated that his arthritis made it too challenging for him to offer a formal handshake. Twelve years on, the zone around the founder has become labelled the ‘hug zone’.

Some management experts and academics, including Sigal Barsade – a professor in management at the Wharton School within the University of Pennsylvania, have recommended ‘corporate hugging’, saying it helps to lower absenteeism, diffuse corporate tensions and fuel higher sales. 

Leading newspaper, The Wall Street Journal, has also printed editorials which support the thinking that workplace hugging promotes better teamwork and healthier business results, whilst simultaneously creating workplace trust.

Nevertheless, those non-huggers who are uncomfortable with getting tactile with their co-workers or bosses, begrudge being required to do so.  Furthermore, what one person describes as ‘a hug’ can easily be interpreted by another member of staff as harassment of an unwelcome nature.  

This debate could not be any more relevant, as the UK employee tribunal statistics have skyrocketed since last July, when fees ceased to be charged for bringing an action.  Single claims at employment tribunals increased by 90% between October 2017 and the end of the year.  Even before fees had been abolished, there were 12,038 cases of unfair dismissal, in the year to June 2017.  30,000 cases were brought in relation to the Working Time Directive and 10,467 regarded equal pay issues.

A tribunal can result in an at-fault employer, paying not just an award to their employee, but also a further penalty payment of between £100 and £5000.  The level of penalty is fixed at 50% of the amount of compensation awarded, although, if this paid within 21 days, the sum can be reduced by 50%.

With so much at risk, employers should exercise caution in their approach to staff relations.  They can also buy a further layer of protection in the form of employment tribunal insurance, which will cover any legal costs emanating from a case brought by an employee.  Companies like Ted Baker, which have implemented a hugging culture, could now regard this as essential, in the wake of the recent headlines and employee petition signed by Ted Baker workers.

January 21 will mark National Hugging Day, making it sensible to act now and check out insurance options, if you intend to celebrate that to the full.  Employment tribunal insurance should, however, be considered for many other reasons than concerns about workplace harassment.  If you need advice on such insurance, please just get in touch.  We are here to help. 

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