Management Clinic: Fending off invaders

The rival firm, clearly keen to have your employee work for it, has offered substantially favourable terms and so it might well be outside your grasp for several reasons to retain this employee: you do not know the circumstances behind the proposed move.

The first port of call when attempting to retain staff is likely to be improving their financial package, so giving a pay increase is a good start and one that constitutes a variation to the employee's terms and conditions of employment. Changes to terms and conditions of employment need the employee's consent, though obtaining it is rarely an issue when you want to make improvements. This can therefore be done very quickly by calling the employee to have an informal chat and agreeing an improved salary.

Enhancing annual leave entitlement, employer's contribution to the employee's pension, reviewing contractual sick pay, or any other term that you can identify as being a useful bargaining tool, can also be agreed upon by talking to the employee.

However, you will start this conversation on the back foot because the negotiating power lies with the employee: they know you want to keep them. This means that an agreement upon new terms and conditions could be delayed, though your prompt demonstration of desire to improve the employee's terms starts the ball rolling and makes them aware that action is being taken. If the employee is happy with your first proposals, this process can be completed within one meeting.

When terms have been agreed, you need to back this up in writing. You can simply issue a form to the employee for them to sign that sets out all the new terms and the date from which they take effect; this acts as an amendment to their statement of main terms of employment and should be kept on their personnel file.

Deeper issue
If your employee is being poached then financial enhancement could be enough to retain him, yet if your employee has sought out the new job then their reason for doing so might not lie in money matters but other conditions of employment. You might have to consider factors such as the employee's seniority and responsibilities, negotiations for which changes can take time. You should be prepared to set aside some time in your day, or forthcoming days, to consider these possibilities.

Dependent on the circumstances behind the job offer and agreements you have with the rival firm, it is unlikely you will have recourse from it. If your employee does decide to leave and has signed a restrictive covenant placing limits on their work after terminating employment with you then you could attempt to enforce that in the civil courts. If the employee leaves without working their relevant notice period with you, you may be able to claim breach of contract against them. You cannot stop an employee leaving, though employment contracts are legally binding for a reason and can be relied upon in circumstances like these. It appears the rival firm is anticipating your action in this regard.

Peter Done, managing director, Peninsula