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Getting Full Value from your Contract


In last month’s article we looked at how a Salon might derive the maximum benefit of a good quality Contract of Employment. We considered why the Contract was a vital tool for a business and not just a necessary “piece of paper”.

In this feature we will focus on a few specific areas in more detail

Probationary Periods

Once an employee has 12 months service they cannot be dismissed without a series of warnings or if they do something fairly drastic which constitutes “gross misconduct”. This is because after 12 months an employee can take their employer to Employment Tribunal and claim unfair dismissal.

The probationary period is your one opportunity to release staff who are simply “moderate”.

Even with the most comprehensive recruitment and selection process employers sometimes do get the wrong employee. This is where your trial or probationary period comes in. The law doesn’t prescribe how long a probationary period should be. In my view three months is far too short . I normally recommend “up to 6 months”. Note the wording is up to rather than 6 months which implies you are guaranteeing 6 months work. Sometimes new appointees take longer to become established and you might like to build in a facility to extend the probationary period for up to a further three months.

It is invaluable for the salon owner to outline their expectations to the new employee. For example “after 26 weeks your column should be taking £X”, “you should be retailing £X, and your client retention should be X%”. These are all objective and quantifiable targets. Often salons have similar targets for interim review at four and twelve weeks. It would be reasonable also to make reference to other expectations such as timekeeping and attendance .These targets are equally helpful for new appointees to understand your expectations ,typically the discussion would also cover the in house training and support to enable the therapist to achieve the targets.

If the employee falls short of your expectations under one of these headings, it isn’t necessary to go through your disciplinary process; you simply decide, after discussion with the employee, “not to confirm the appointment”, they would be entitled to notice and I recommend giving a right of appeal

Of course, you need the wording of the Probationary period in your Contract to be watertight

Training costs

Salon owners invest heavily in training new staff, this might be product and/or skills training. it is both legal and economic sense to have a clause in your contract to recover these training costs if an employee leaves.

It would be quite reasonable to recover costs for two days of product training or a three day laser course off site. The recovery can include travel and accommodation costs. Typically the contractual clause applies if staff leave within a prescribed period having received training , some salons have a sliding scale eg 100% for 12 months and 50% for 12-18 months.

You cannot recover costs if you end the employment, similarly you can’t normally recover wage paid to an employee whilst receiving training. In-house training is also problematic as the salon hasn’t incurred a physical cost if the training is provided by its’ own staff.

Of course, the provision should be in your contract. It makes sense to require staff to sign a separate training agreement each time they attend training. They sign to agree the cost and recognise the recovery of costs if they leave within your prescribed period.

In a recent case an employer deducted training costs from the final salary of an employee. Surprisingly, the employee took the case to Employment Tribunal claiming an unlawful deduction of salary. The employee won their case as, whilst the Contract required the employee to repay the training monies it did not permit the employer to deduct it from their salary! Simply adding “we reserve the right to recover training costs from your final salary” would have avoided this embarrassment!

In the next issue we will look at the trials and tribulations of drafting and enforcing a restrictive Covenant

David Wright supports Salons across Britain. For an all-inclusive fee of £200 per annum plus VAT he will draft your Contract and produce your Employment policies, you also receive a monthly newsletter and access to his personal advice line.

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