NOTW FIASCO – WHAT CAN BUSINESSES LEARN ? PART TWO...

The shock closure of the News Of The World and the phone hacking scandal has left many of the British public shocked. 

Empire is encouraging businesses to learn from the NOTW situation, as it serves as a timely reminder that no business is immune from closure, and very large, successful businesses can be destroyed by the actions of a few employees.

In light of the closure Empire has compiled a list of potential learning points for other businesses to take into account. Over a series of blog posts we will highlight the issues that we feel are important to consider.
Last week we discussed issues concerning Whistle-blowing and Organisational Culture. This week we look at further pointers that should be learned from the NOTW shock closure.

ETHICS ARE IMPORTANT
In an increasingly transparent business community, it is more important than ever to ensure your business is ethical. At the most basic level, customers tend not to want to buy goods from a supplier with questionable ethics. Suppliers may not wish to associate with a business with a poor reputation for ethics, and this was clearly demonstrated when advertisers withdrew from the NOTW. Ethics can be the foundation of a positive organisational culture and the two are closely linked.

SEEK LEGAL ADVICE BEFORE ANNOUNCING REDUNDANCIES
The NOTW’s 200 employees were collectively advised of their impending redundancies during a staff meeting in the office on the week of the disaster. This potentially breaches several requirements of employment law, namely that they should have been collectively consulted prior to the final decision being made. The Secretary of State must also be notified when there is a proposal to make 20 or more employees redundant. A failure to consult may result in an award of 90 days’ pay to each employee as well as potential unfair dismissal claims.

TRANSFERS MAY INCUR TUPE LIABILITY
There is speculation that News International will simply start publishing The Sun on a Sunday to replace the NOTW. This could result in what is known as a TUPE transfer, whereby NOTW employees should have their employment protected and transferred. Further details on this are expected in the near future, but the NOTW would be well advised to seek legal advice on this immediately. Businesses must always ensure that advice is sought prior to mergers, buyouts and the sale of businesses in order to avoid unexpected liability for transferred employees.

HEALTH & SAFETY

THE DAMAGES (Scotland) ACT 2011
This new act has been introduced to end the long legal battles in pursuit of agreement over damages claims altering the way Scottish courts will now award damages following fatal accidents.

A fixed percentage of 75% of the net income will now be used as the basis for calculating the loss of support entitlement for dependants of the deceased, applicable in all cases except where a court considers that it would result in a ‘manifestly and materially unfair result’.

Furthermore, a spouse’s income will be disregarded when calculating the amount of damages to be paid.

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NOTW FIASCO – WHAT CAN BUSINESSES LEARN?

The shock closure of the News Of The World and the phone hacking scandal has left many of the British public shocked. 

Empire is encouraging businesses to learn from the NOTW situation, as it serves as a timely reminder that no business is immune from closure, and very large, successful businesses can be destroyed by the actions of a few employees. In light of the closure Empire has compiled a list of potential learning points for other businesses to take into account. Over a series of blog posts we will highlight the issues that we feel are important to consider.

The most popular English-language newspaper in the world was published for the last time in July, which has left politicians, News International, The Metropolitan Police, and the NOTW employees battling to find out who is to blame. Public speculation, police questioning, political debate, and media coverage is certain to go on for the foreseeable future but, in the meantime, there are lessons the business community can learn from the demise of the NOTW. 

Here are the first two points where lessons should be learned from NOTW:

ORGANISATIONAL CULTURE MUST NOT BE NEGLECTED
Does the culture of your business encourage employees to push the wrong boundaries, go to extremes and turn a blind eye to bad practices?
A journalist deleting the voicemail messages of murder victim Millie Dowler is an extreme example of this, but can you be sure that your employees wouldn’t be tempted to break the law if pressurised?
In the case of the NOTW, serious questions need to be asked about why journalists felt the need to go to such extremes to get a story.
Could the HR department or line managers have prevented this incident by fostering a different organisational culture?

WHISTLEBLOWING CAN HELP BUSINESS
A good whistleblowing policy encourages employees to come forward if they become aware of malpractice or breaches of the law. This allows a manager or HR department to be made aware of the issue as early as possible, therefore preventing an escalation. It is likely that the NOTW did have a policy, but employees did not feel able to use it. The importance of encouraging an effective whistleblowing policy was also demonstrated by the recent care home scandal in Bristol, in which a senior nurse broke the silence of abuse of patients resulting in closure of the home. It is not enough to simply have a policy, it must be circulated and utilised appropriately.

It is important that businesses throughout the UK take on board the lessons learnt, and most importantly ensure steps are taken to prevent the same thing happening to them. We will be posting more pointers relating to the NOTW scandal in the following blog posts.

 
A REMINDER - NEW ARRANGEMENTS FOR REPORTING OF INJURIES AND INCIDENTS TAKE EFFECT FROM 12th SEPTEMBER

The Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 1995 (RIDDOR) place a legal duty on employers, self-employed and people in control of premises to report work-related deaths, major injuries, over-three-day injuries, work related diseases and dangerous occurrences (near misses).

Businesses will no longer be able to report incidents by email, post or fax.

Fatal and major incidents and injuries will still be reportable by telephone however all other reportable work-related injuries and incidents under RIDDOR will move to a online system using interactive forms.

Seven forms will be available on the HSE’s website which is aimed at separating the incident type and making the statutory reporting process quick and easy for employers to use.

Further changes will take effect on the 30th September 2011 - the HSE’s Infoline telephone service, which currently provides a basic information service to callers, will end due to the increased use of their website.

We would really like to hear your views on the issues that have been highlighted in this post. Have you had any experience in people within an organisation turning a blind eye to bad practices? What are your thoughts on the whistleblowing culture? Do you think it can help businesses? What are your thoughts on the new arrangements for reporting injuries? Join our facebook page to enter our discussions amongst our online community

If you have found this post interesting please use the "Share" buttons below to tell your online community about it, there's a good chance they will find it interesting too. Thank you.

You can also follow Empire HR on Facebook - please click here