Name of weekly column: Speechly Speak

Name of this week's contributor: Juliet Carp, solicitor, Speechly Bircham

The government is consulting over a proposal that CIPD qualified HR specialists should be able to 'sign off' on compromise agreements.

As readers will know, a compromise agreement is a binding agreement to settle an employment dispute out of court.  The agreement is only valid if certain conditions are satisfied. One of those conditions is that the employee must have received advice about the 'terms and effects' of the agreement from a qualified person. The adviser must be insured and independent, and must be one of the following: a qualified lawyer or legal executive, or a certified trade union representative or advice centre worker. 

Consultation document

The government points out in its consultation document that HR professionals already play a role in negotiating compromise agreements but that “under existing legislation they are unable to complete the process”. 

This is technically true and many HR professionals have the skills and experience needed to negotiate a compromise agreement from start to finish - for the employer. If they need any help with technical issues they will know where to ask for it and will usually have the resources to pay for it.

Giving good advice

The point, though, is that the requirement for advice from an appropriate person is there to protect employees, not employers. This is not about a closed shop for employment lawyers, trade unions and advice workers: this is about trying to make sure people in difficult situations get good advice before they give up their rights to make claims. Will an extension in the range of qualifications that are acceptable for giving that advice help employees or employers? 

The employer needs to be confident that the requirements of the legislation have been satisfied and the compromise agreement is effective to stop the employee from bringing claims. 

It is fairly easy to check that a lawyer is qualified. Solicitors’ names are listed on the internet and they should each hold a practising a certificate. Strict professional conduct rules govern independence. Qualified trade union representatives and advisers should also be certified, and their independence is unlikely to be in doubt.  Arrangements would need to be put in place for relevant CIPD qualified HR professionals, so that employers can have confidence that compromise agreements are properly concluded.  

Most HR professionals with relevant experience work for employers - and those employers are unlikely to allow their staff to have a sideline in advising employees making claims against other employers. Even if the employer were open-minded, and perhaps saw this as good training, the HR professional would need to be insured and the employer could be held responsible for any bad advice given. 

In practice

In practice, the HR professionals who are most likely to be interested in advising employees are likely to be independent CIPD qualified HR consultants in the business of selling HR advice. We need to ask ourselves whether the extension of employee 'choice' to those advisers will be of real benefit to them. It will be difficult for an employee to know if the consultant has the appropriate skills and experience to advise on what can often be difficult legal issues, or to or suggest alternative solutions or drafting. 

There may be uncertainty over whether legal professional privilege will apply to discussions with the employee about claims and there is unlikely to be a regulated procedure for challenging bills or raising other complaints.

Clearly there is a great deal that should be considered before decisions are made on whether approval is appropriate. If you have views then you have the opportunity of expressing them to the government as part of the consultancy exercise.