Sofia Syed is a Partner at Keystone Law with extensive experience advising high-net-worth clients in all aspects related to their household and their business affairs.
Having recently launched Hanover Private Household HR, we sat down to discuss the reputational implications of recruiting.
Do you think many families properly consider the risk their household staff might present to their reputation?
Sofia: Unfortunately, families rarely consider the risks posed by their household staff.
Many of my clients, who may be deeply private (and high profile) individuals, simply do not associate hiring household staff with the same reputational risk as they would if they were hiring someone in their business. This is a fallacy, and families should be aware that once they enter into a legal relationship with a member of staff, both parties have rights and responsibilities to each other. There is immediately an implied duty of trust, confidence and loyalty (among others). A breach of any of these duties can lead to reputational harm, especially in the household scenario.
Securing the right household staff member is often a huge relief, knowing that someone is there to take away the pain of the mundane is no doubt immensely liberating. However, among the process of onboarding new staff, sometimes little consideration is given to the amount of personal information that an employee will have access to once they start working in the household. They get to know individual family members personally and are aware of their preferences, their visitors and their every movement. Depending on who the family is any personal information can become a story in the media regardless of whether or not it is in fact interesting.
Much of my time is spent protecting my clients from reputational harm by ensuring they comply with all legal obligations and fair treatment of their staff and ensuring the staff are aware of the importance of privacy and the consequences of any breaches.
And my sense is that the risks of household staff are potentially even higher than other employees?
Sofia: A valuable private staff member will often know the family members better than the families know each other. When someone holds the key to your private life, that keyholder needs strict guidance on their responsibilities and should be held to account for any misuse.
Sometimes families may try to cut corners by using old template contracts or ones from recruitment agencies, not appreciating that whilst these may protect the employee, they fail to fully protect the employer’s interests. Sometimes they are ill-advised or do not have specific UK employment law guidance.
This is especially the case where families are new to the UK or do not have specific employment legal advisers.
I've found that while a family business will have a Head of HR, these responsibilities tend to fall to the family's EA in a family office. Is that something you recognise?
Sofia: Yes, I come across this a lot. It further demonstrates how families can have little appreciation of the importance of getting it right until, of course, they have a bad experience such as a sour termination, threats of a breach of their privacy or a claim against them.
I feel for the PA or EAs who are often thrust into such a position, usually with no training and little understanding of employment law. I run training courses and workshops specifically for EAs, PAs and House Managers to help them to understand the role and to equip them with the tools they need to carry out their role more effectively.
We constantly talk about prevention being better than cure. I'm certain that employment is an area where that is true?
Sofia: Prevention is definitely a large part of my role. If I am instructed at the start of a relationship, I would firstly look at employment status. There has been a lot in the press about miscategorisation of status and this usually is a simple mistake made at the start and can cost a client dearly in reputation as well as taxes. Just think Uber and Deliveroo.
Thereafter, I ensure they have correct and thorough contracts in place, with strict confidentiality and privacy provisions to protect my clients and their families.
I discuss and document issues relating to GDPR, insurance and health and safety (especially following COVID-19) and all manner of legal considerations which may often be termed 'boring' but are incredibly important. My work comes to life whenever there is a problem within the household, which is usually inevitable. It is at that point that my clients know they are better protected and their exposure is limited.
Do you think the media landscape has increased the risks?
Sofia: We live in a culture dominated by social media. My clients' properties, assets and children can be very Instagramable — it is important for staff to be aware of privacy and what is not acceptable. The documentation that I draft is tailored and specific to each role and each client, ensuring their family is protected.
If there was one takeaway you would give to families, what would it be?
Sofia: UK employment law is employee-friendly; it is inexpensive and relatively easy for employees to bring a claim. Protect yourself and your family by seeking specific and tailored employment law advice as early as possible when you are hiring staff or at the first sign of trouble.
Prevention is definitely cheaper than cure in the world of litigation and reputation.