5 commonly asked questions by employers about secondments

What is a secondment?

This is where you ‘lend’ an employee to another area of your business, or to another entity within your group company or even to a customer of your business.

Example:

• Company A lends their employee B to Customer C
• Company A remains the employer
• Employee B is the secondee
• Customer C is the host

Could this benefit my business?

Consider the following:

• Do I have staffing issues in a particular area of my business?
• Do I have a specific project for which I need more employees?
• Does my client need particular expertise that I can facilitate?
• Am I considering potential redundancies?

By seconding employees you could potentially boost skills levels and staff retention rates in addition to avoiding potential redundancies. You could also promote long-lasting and valuable business relationships.

Do I need to amend their contract of employment, and can I?

• ‘I will only need to make minimal, if any, minor changes to my employee’s terms of employment’

In this case, an informal secondment might be appropriate and you will not necessarily need the employee’s consent to make appropriate, reasonable and limited changes to their existing terms.

• ‘I think I will need to make considerable changes to their terms of employment’

In this case, you may wish to consider issuing a secondment agreement. You also will not be able to unilaterally dictate the change in terms; you will require your employee’s consent or risk being in breach of contract.

You may also wish to consider recording the terms of agreement between you and the host organisation. Sometimes a single secondment agreement between all three parties might be suitable.

Our Employment Law team can provide you with advice and guidance regarding changing an employee’s terms and conditions and offers free health-checks of your employment contracts and staff handbooks.

Contractual considerations; me or the host?

When preparing the secondment agreement, it may be useful to consider the following:

• Intellectual Property: is this protected from the third party?
• Payroll: who will manage this me or the host?
• Conduct/performance: who will monitor this?
• Confidentiality: is my business’ confidential information adequately protected?
• Termination: what mechanisms for terminating the secondment are available?

When considering logistical aspects such as payroll it is important to consider the implications on the employment relationship. You do not necessarily want the host to manage this type of aspect and inadvertently risk the possibility of your employee becoming, in reality, the host’s employee in case of any future potential dispute concerning the employment relationship. Usually the host would be expected to bear the cost of the secondee’s salary by way of reimbursement to the employer.

How do I select for secondment?

Consider your staff carefully and sense-check your selection criteria. Secondment opportunities can boost an employee’s career prospects and so you do not want to inadvertently find yourself facing a discrimination claim based on your selection as a result of a disgruntled employee.

• Ensure a fair and transparent selection process;
• Consider inviting interested employees to apply;
• Use a fair and objective selection criteria; and
• Avoid making assumptions about an employee’s ability to carry out the responsibilities of the secondment.

E.g. Employee B and D are both interested in a secondment opportunity. Host C requires the secondee to work long hours which are outside of usual business hours. Employer A considers Employee B would be best suited because he is a single man without any dependants and a full time worker, comparatively to Employee D who is a mother with 2 children and who works part time.

In the event the Employer chooses Employee B on this basis, Employee D could have potential claims in the employment tribunals available to her against the employer including for sex discrimination and less favourable treatment of a part-time worker.

How can Ellis Jones help?

If you require legal advice about employment based queries, processes, contracts or disputes, get in touch with our Employment Law team for assistance on 01202 525333 or by email at employment@ellisjones.co.uk.