Quiet firing: bad HR or constructive dismissal?

The newest, and potentially most toxic, HR trend is causing a global staffing crisis – one that some organisations may not recover from. But it’s not just a case of ‘bad HR’ – in serious instances it could be deemed bullying or even constructive dismissal.

Essentially, quiet firing occurs when organisations fail to give employees constructive feedback or details on their career trajectory. Managers may decline salary requests, or forget to pass on information that employees need to succeed – leading to frustration, low morale, and even lawsuits.

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“It’s effectively setting up employees for failure and creating a toxic work environment that they do not want to participate in so they will be enticed to leave,” Annie Rosencrans, Director of People & Culture at HiBob told HRD.

And don’t make the mistake of thinking that this trend is a one-off. According to a recent LinkedIn poll, 48% of employees have witnessed a quiet firing, while 35% have been on the receiving end of one. But let’s not lay all the blame at HR’s door. Quiet firing isn’t wholly an HR issue – it’s a C-suite one. A passive approach to management means that team leaders often avoid ‘difficult’ conversations with their people. This not only leads to confusion and apprehension on the employee’s part, but it could be deemed ‘constructive dismissal’ in serious cases.

‘Managing out’

Managing out occurs when a manager ignores an employee, neglecting them to the point that they feel they have no option but to quit. When an employee feels ‘forced out’ due to an employer’s conduct, they can claim compensation and even escalate a lawsuit. Under common law in Australia, constructive dismissal is defined as an incident in which the employee voluntarily leaves an employer because of an unfolding situation – one that makes it impossible for them to stay.

Employers also need to be mindful of changing the terms of an employment contract – that could be seen as a shift in working hours, additions or deductions of responsibilities, reducing pay or removing contractual benefits. All pretty serious stuff – and all in-keeping with quiet firing allegations.

Avoid costly lawsuits over constructive dismissals

Can you be sued over ‘managing out’? Well, hold on to your seats HR. There are employment law risks when employers engage in quiet firing - especially in regards to constructive dismissals and workplace bullying.

Under the Fair Work Act, a constructive dismissal occurs when an employee resigns from their role because of their employers conduct – as if their position has become untenable. Essentially, the worker is claiming they’ve had no choice but to quit – forcing their resignation. This can occur in cases of harassment and bullying – but the definition could extend to quiet firing too.

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In addition to claims for damages, employers also risk reputational damage if employees seek redress in courts and other tribunals that are open to the public. A pretty hefty price to pay for avoiding a painful conversation.

Signs you’re being quietly fired

And quiet firing isn’t just an ‘employee’ concern – HR practitioners can be quietly fired too. What makes quiet firing so toxic is that it can happen to anyone – no matter their position, tenure, or rank in an organisation.

“There are several factors employees can look out for to see if they are a victim of quiet firing,” added Rosencrans. “It’s important to consider these factors together, though, and not assume a lack of promotion - for example - is quiet firing.”

• You are constantly being passed over for promotions and raises.
• You are not given constructive feedback on assignments or tasks.
• You are given assignments and/or shifts to work that are below your abilities or at times that separate you from colleagues.
• You are not being given information you need to succeed at or excel in your role.
• Your manager isn’t taking time to connect with you one on one.

Get comfortable with being uncomfortable

So what should HR do to put an end to this trend – and protect themselves? Well, it’s begins with putting on you big boy pants and having an honest, albeit difficult, conversation.

“Transparency and feedback are imperative to creating an environment where employees feel seen and heard,” Rosencrans told HRD. “It’s the responsibility of managers - both mid-level and senior managers - to connect with and engage with members of their team to share insight into what they are excelling in, areas for improvement, and to check in regarding their career satisfaction and goals.”

Most importantly, HR leaders need to train managers on how to have tough conversations. Giving people critiques, telling them they need to improve their performance, it’s never easy – or fun – but it is a key part of management. Ensure your people know how to navigate these talks by using online development tools or one-on-one coaching sessions.

Legal advice for Australian employers

So how should HR approach a case of suspected quiet firing? As with all things in HR, the answer is ‘it depends’. As esteemed author Angela Champ once told us, everything in HR is determined on a case by case basis. But if you’re worried about the repercussions of quiet firing then take some time to consider your actions – and how they’ll impact the company as a whole.

Speak to an employment lawyer if your concerned that quiet firing is happening in your workplace. Make sure you coach your leadership teams on the intricacies of Fair Work Act 2009 (FW Act) – Statutory Unfair Dismissal. 

Don’t end up with a lawsuit on your hands just because you want to avoid an awkward conversation.