Do you need a Capability policy?
‘Capability’ is one of the five fair reasons for Dismissal, HR Director of London private GP clinic London Doctors Clinic, Vicki Field explains.
However, it can be split into two distinct parts; inability to perform the job as a result of incompetence, and inability to perform the job through sickness absence. Some companies blur the two and have one policy to cover both, but I’ve always found that to be confusing. A Disciplinary policy should cover poor performance or misconduct. A Capability policy describes the process that needs to be followed when someone is either on repetitive short-term leave, or long-term sick leave, to assist with their return to work, or eventual fair dismissal.
It is different to the Disciplinary process as it does not assume that the sickness absence is ‘misconduct’, and so removes the sense that the employee is someone behaving badly by being ill. Years ago, I worked in a company where we needed to fairly dismiss someone who had been off work for a year with a long-term condition. There wasn’t a Capability policy, and so we had to put the employee through a full three stage disciplinary process, with appeals at all stage. It was a dreadful process, and since I’ve been a HRD, I’ve always made sure that there is a separate Capability policy to manage sickness absence.
Every discussion, decision and dismissal made under the Capability policy can be extremely hard as there is generally a genuine issue of ill-health, and the company is determining whether or not to remove someone’s job at a time when they are most vulnerable. A well-written policy, with clear steps can help mitigate some of the concern and discomfort as both the company and the employee know what steps to follow, and what extra support from medical professionals will be sought.
Whilst the Employment Tribunal has given us the steer that the ACAS code does not apply to dismissals on the ground of ill health, (as it is limited to disciplinary procedures related to culpable misconduct or culpable poor performance), it’s important to document and follow a clear process in the policy. Following this means that the employer is most likely to meet the test of ‘reasonableness’, and it also means that the employee will understand exactly what is happening and the possible outcomes at each stage.
Structure of a Capability policy
Generally, a Capability policy should have a three stage process like the three stage process of a Disciplinary policy. Each stage includes a form of investigation (length of absence to date/a medical report), followed by a meeting, and then the outcome of the meeting (ie an action plan or further medical reporting)
Managing short-term and long-term absence
Short-term intermittent absence is generally managed through setting targets in an action plan; ‘I expect no absence for the next 30 days’. A failure to meet the goal would lead to the first meeting under the Capability policy. There is an opportunity to ask the employee the reasons for the absence, and at this point to try to understand if there is an underlying condition.
In many cases, I’d recommend that a GP or OH (occupational health) practitioner to meet with the employee and provide a more in depth analysis of any potential underlying condition, and give a steer if it may fall under the definition of Disability. One of our GPs, Dr Preethi Daniel says ‘I usually consider the nature of sickness, whether this is physical or psychological. I want to gauge if there is a hidden agenda such as in fact stress at work which is causing very real physical symptoms preventing the employee from going to work.’ I’ve had a really helpful GP report which advised that the intermittent absence was actually all stress related, and the employee was uncomfortable about saying they were stressed and so listed colds or stomach upset. Giving them the opportunity to talk to a doctor in a ‘safe space’ and having it fed back sensitively to the company, allowed us to put in place mechanisms to support the employee, which resulted in a higher level of satisfaction from them as well as reduced absence.
Depending on the action plan, the outcome of the meeting would be a further action plan, and any medical support that may have been suggested by the employee or the GP. Dr Daniel adds, ‘I might recommend a phased return or altered hours or responsibilities to ensure the employee does not experience setbacks on return to work.’
If the person is a malingerer (not genuine absence), or just someone with random and unconnected sickness that the company finds unacceptable, as long as the process is followed, the eventual Dismissal will be fair. Failure to meet action plans would lead the person through the next two meetings, with medical support at each stage, if appropriate. The final meeting would be a Dismissal meeting, which is a formal meeting so the employee has the right to be accompanied, and the right to Appeal the outcome.
If there is an underlying condition, it’s necessary to ensure that the company has as much information about the medical situation as possible, which is where the report from the GP is key. For instance, according to Dr Daniel, employees with certain medical conditions such as Crohn’s may need easier access to the toilet or reasonable adjustments such as these to be made by the company.
Managing long-term absence
Long-term absence is generally considered to be over 4 consecutive weeks. At this point, medical reports are crucial. It can be hard to get a good report, I’ve had OH reports in the past which barely provide any data and make it hard to actually understand the issues, and what the company needs to do to manage it.
The best report covers the diagnosis, prognosis, treatment and timescale for any return to work, and also gives the employer a view of any role that they could do within the company. It should also include any reasonable adjustments to working arrangements that could be made to assist the employee, and also, crucially, if it might be considered to be a disability. Adjustments at work, staggered returns, medical treatments or even early retirement are all options to discuss with the GP and the employee.
Dismissing under the Capability Policy
In order to be fair, the employer needs to have acted ‘reasonably’. To meet this test, the employee needs to have been informed and consulted at each stage. It’s important to ask the employee their own views of how and why they are ill, and ask they what support they may need to return to work. Setting up a meeting between the employee and a GP is the best way of getting a clear steer on the likely return, and any future likely absence. It means that decisions can be made based on the best available information, and the employee and employer have access to the same information. There are no surprises!
The ET would also expect that the length of service of the employee is taken into account; if someone has 10 years service with no history of absence and they have three months of excessive short-term absence, it would not be fair to dismiss them even if an action plan has been set each month. Similarly, if there was a long length of service, and the employee had an absence lasting 4 months with a clear return date, it would probably be unfair to dismiss.
The ET would also look at the impact of the person’s absence on the team, and the nature of their role, as well as other things like the size of the company and whether the employee had exhausted sick pay. Like most things in employment law, you need to act sensibly and with compassion and you generally meet the test of ‘reasonableness’.
Crucially, the ET would look at the nature of the illness, and the likelihood of the person returning to work. The only way to ensure absolute clarity of these two aspects is to obtain a medical report.
In summary, a Capability policy allows a company to effectively manage excessive absence. It provides clarity to employer and employee, and ensures that the appropriate medical support is sought at each stage. Ideally, the point of the policy is for employees to return to work, however, it also provides the best approach to an eventual fair dismissal.