What a huge pile of stinking, sloppy steaming turds we are being served, on the subject of employee contracts at the moment!  It’s been common, in recent times, to hear people bemoan the lack of spelling, grammar, and correct use of English in public discourse.  We laugh, when we receive a badly written CV.  We share instances of poor English in social media, and we fall over ourselves when a brand like Waterstone’s decides to dispense with their apostrophe.  (Please note my extensive use of the Oxford comma in my frequent lists, and parentheses).  Well, that is as nothing to the deliberate and malevolent skewing of the facts, when it comes to the Third Estate’s discursive ramblings about the nature of employment contracts.

Whilst I do not profess to be any kind of expert in this matter (I defer to my HR friends), I have worked in the employment field for long enough.  Let’s take the most prominent and topical case in hand first.  Stephen Hester, was hired as the Chief Executive of RBS, at a time when the business had only just been saved from extinction by the public purse.  In the course of doing so, his contract terms will have been agreed. Firstly, it needs to be said, that for any employee to be paid a salary of £1.2m per annum is outrageous, and I’d say immoral.  I make the distinction between employees and business owners, who naturally are rewarded for the risk they take with their capital.  Having said that, it appears that Hester was given both a binding contract, and an additional nod and a wink, as to the typical generous bonuses awarded in the banking sector.  Much like the MP’s expenses scandal, these “bonuses” do not exist as actual incentives for hard work, but rather as a means of keeping the headline salary figure down to a mere stratospheric level, lest it be reported to the public or even shareholders.

So the public, ably prompted by politicians doing what politicians do (stirring) are outraged enough to demand that the bank sticks rigidly to the contract, and awards no bonus at all.  That’s quite the reverse of the situation, when Fred the shred Goodwin was removed from the same job, when the outcry was to tear up the contract, regardless of it’s legality.

Surely with all this talk of employment contracts, the public and politicians would learn a few things. Barely a tabloid back page goes by, without a footballer’s contract being discussed at length, by those who know nothing about it.  For the record, a footballer or football manager is not “sacked” when their contract is not renewed.  Either they were contracted for a period, and that period has run out, or the parties have negotiated an early settlement from the contract.  PS. I doubt if Harry Rednapp’s Monaco bonus was in his contract.

As with pre-nuptial agreements, contracts can only be negotiated fairly by both parties BEFORE the engagement has begun.  Any lack of attention paid to this will assuredly be exploited by someone do so when things get sticky.  In the case of Stephen Hester, I believe he did the wrong thing, for the right reasons.  The responsibility to provide a bonus, or not, lay with the bank itself.  They were wrong to offer the £1m bonus, when they had no contractual obligation to, and by doing so served only to hang their own CEO out to dry. If they had really wanted to pay that sum, and he really wanted to earn it, it should have been specifically provided for in his contract.

When is a Contract not a Contract?  When it’s accompanied by a nod, a wink, and a tap on the side of the nose.

Stephen O'Donnell is a lifelong recruiter, internet enthusiast, fadgadget and peripatetic writer.

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