Personal relationships in the workplace have recently been highlighted in the news as Laurent Freixe was fired from his position as Global CEO of Nestlé (the “world’s largest food and beverage company”), for failing to disclose his relationship with an employee in his direct reporting line.
Reports of the CEO’s undisclosed personal relationship with an employee were initially raised to Nestlé’s board of directors via the company’s internal reporting channel “Speak Up”; however, an internal investigation at the time was unable to confirm the existence of the relationship.
Despite the CEO’s continuous denial of the existence of the relationship and the conclusion of the internal investigation, further reports of his relationship with an employee and “improper favouritism” continued to be made and led to a further investigation being undertaken with the assistance of external advisors. The CEO was subsequently found to have failed to disclose the relationship and was dismissed without severance pay.
The CEO’s dismissal from Nestle follows several other recent high-profile workplace relationships which led to senior executives resigning from their position or being dismissed including:
- The former CEO of Astronomer, Andrew Byron, handing in his resignation after being caught embracing a colleague in a ‘viral’ video at a Coldplay concert; and
- The former BP Chief Executive was dismissed in 2023 following his failure to disclose past relationships with colleagues.
Whilst workplace relationships are typically considered ‘inevitable’, particularly when employees work closely with one another, employers and HR professionals may justifiably be concerned about the potential risks of personal relationships in the workplace, including: perceived favouritism in the allocation of projects or within performance reviews, breaches of confidentiality and conflicts of interest. These issues are often considered to be of particular concern to employers when the individuals involved are in the direct-reporting line to one another or when there is a significant power imbalance between the two parties.
Our Employment Lawyers explore recent high-profile examples of workplace relationships, particularly those where a relationship has not been disclosed, and raise important questions about how employers can mitigate the risks to the business of such personal relationships in the workplace.
Employee’s Rights to Privacy and Workplace Relationships Policies
Unlike in the US, where stringent ‘anti-fraternisation’ policies or outright bans on workplace relationships are more commonplace and may be enforced, such measures are typically deemed inappropriate and disproportionate in the UK under the Human Rights Act 199,8, which incorporated the protections awarded by the European Convention on Human Rights, including Article 8 right to privacy, into UK domestic law.
However, there is a growing sense that more needs to be done in this area within the UK, with a landmark report recently proposing an outright ban on sexual relationships between barristers and junior staff.
In keeping with this changing tide, workplace policies are increasingly being used by UK employers to mitigate against the risks of workplace relationships by requiring employees to notify the company if a romantic relationship is commenced with a colleague.
This requirement for disclosure of relationships can be particularly useful for employers as it may mitigate the risks of any perceived or factual favouritism by enabling employers to ensure that the relevant individuals are not involved in remuneration discussions or other key decisions involving the other party to the relationship.
Employers may also want to consider whether it would be appropriate to require job applicants to disclose any personal relationships with existing employees to ensure fair hiring procedures.
As with all policies, the workplace relationships policy should be proportionate in order to protect the interests of the business without significant interference into the employee’s personal lives. Employers should also clearly explain the reasons behind the policy in order to ensure employee awareness of the terms of the policy itself and to promote employee compliance with the policy.
Workplace Relationships, Discrimination and Unfair Dismissal
The breach of a workplace relationships policy, such as a failure to disclose details of a relationship, may provide an employer with grounds to discipline staff in accordance with standard disciplinary procedures.
However, the dismissal of employees simply due to the existence of a personal relationship in the workplace is likely to be deemed unfair, except in the most severe cases where there has been evident favouritism of particular employees or a significant breach of confidentiality.
In such cases, employers should ensure that a fair procedure is followed and should also note that the applicable ground for dismissal would be the breach of confidentiality or the act of favouritism (which may be deemed misconduct) itself, not the relationship.
The employer should also be mindful to ensure that any workplace relationships policy is applied consistently and in a non-discriminatory manner.
For example, once an employer has been notified of the existence of a personal relationship in the workplace, the employer’s subsequent actions, such as moving employees out of the direct-reporting line of one another, should not be made simply due to gender or because one employee is more junior.
Additionally, employers should be equally mindful to ensure that no discrimination, such as during performance reviews, occurs following the breakdown of any personal relationship in the workplace.
Sexual Harassment
Following the implementation of the Worker Protection (Amendment of Equality Act 2010) Act 2023, which came into force on 26 October 2024, employers are under a positive duty to take reasonable steps to prevent sexual harassment in the workplace.
In the context of workplace relationships, employers should be particularly mindful of the risk of sexual harassment following the breakdown of a relationship between employees where one individual is unwilling to accept the end of the relationship.
To comply with the positive duty to prevent sexual harassment, employers should establish confidential reporting mechanisms, such as the ‘Speak Up’ reporting channel mentioned above, which was in place for Nestlé, to enable employees to voice their concerns confidentially and sensitively.
Once an issue of sexual harassment has been raised and identified, the employer should follow clear procedures to investigate and manage the allegations raised.
Employers would also be expected to have ongoing sexual harassment training, which is tailored to the employer’s business and to the employee’s seniority, for example, as managers may be expected to have greater training in identifying and managing issues of sexual harassment.
Comment
Personal relationships in the workplace raise several issues, such as the risk of sexual harassment and discrimination.
Given the severe consequences of facing a claim in the Employment Tribunal for discrimination or unfair dismissal, or from enforcement action being taken by the Equality and Human Rights Commission for a failure to comply with the positive duty to prevent sexual harassment, employers should have clear policies in place, to promote confidential reporting mechanisms and to ensure clear records are made of any steps taken.
Contact Our Employment Lawyers
If you would like assistance with any such policies or training for your employees, please speak to our experienced Employment team at Myerson.