Using sustainability to attract employees – top tips for contracts and business practices

The battle for talent has seen the issue of ‘greener employment’ surge up the agenda for many businesses seeking to be more appealing to future employees.

Harrison Drury’s employment law team, outline their top tips to help make your business more attractive to prospective employees seeking a greener workplace.

A recent study by Unily reported that 83 per cent of workers did not feel their workplaces were taking sufficient action to tackle climate change, with 65 per cent stating that they would be more likely to work for a company with robust environmental policies.

This demonstrates an increasing trend among employees who prefer to, or choose to, work within a workplace with more sustainable policies. This is likely to have an impact on employee engagement and retention if business owners do not take suitable measures to create a ‘greener’ working environment.

To ensure to be seen as a desirable place to work and a business able to draw top talent, it is advisable that employers revisit their company policies and employee handbooks, in order to attract and retain this talent.

Here are our top tips for employers and HR professionals to help demonstrate to employees their commitment to adopting an environmental policy and proactively seeking to reduce their company’s carbon footprint:

1. Review terms and conditions for contractors and suppliers

One solution is utilising climate-friendly contract provisions. The Chancery Lane Project, a pro bono initiative comprised of lawyers from across the globe, has produced a range of climate conscious clauses which can be incorporated into various types of contracts. These offer a practical means to help companies reach the goal of net zero carbon emissions.

For example, the Project’s “Renewable Energy Requirements in Supply Contracts” provides precedent clauses for a supply agreement that requires the supplier/contractor to procure energy from renewable sources. This may involve supply chain agreements, contracting carriers that only use energy efficient or electric vehicles, or stipulating a requirement that a specified percentage of road journeys must be taken using more fuel efficient ‘greener’ HGVs.

2. Employment contracts

The Chancery Lane Project also provides draft clauses for use in employment contracts. For example, the Project’s “Employee Climate Engagement Provisions” provides a clause for employment contracts requiring the employer to provide, and the employee to participate in, a range of climate education and awareness-raising interventions.

This type of agreement empowers employees to participate and actively engage in the climate ambitions and net zero targets of their employer.

Draft wording has also been prepared for inclusion in a whistleblowing policy, to extend its application to disclosure of climate issues and non-adherence to the company’s sustainability policies.

These provisions are clearly aspirational and are not currently considered as standard employment contract clauses, however, businesses may benefit from introducing them over time to take a proactive approach to managing environmental concerns.

If you plan to update your employment contracts to include such clauses it is strongly recommended to seek legal advice first to ensure they comply with other areas of employment law.

3. Employee benefits and endorsements

Considering the increased concern in environmental issues across the workforce (particularly among ‘millennials’ and ‘Gen Z’ groups), employers may also consider offering benefits and implementing policies to encourage employees take more sustainable measures as part of their work/life balance.

These may include:

• Giving additional leave to employees who opt for stay-cations and/or use more sustainable transport to reach their holiday destinations.
• Subsidising the cost of electric vehicles and/or providing electric car charging ports within office parking facilities.
• Offering discounted season tickets and loans for employees who opt to use public transport or join cycling schemes.
• Accommodating flexible working to reduce travel between the workplace and subsequently carbon emissions.

While employee benefits and contractual provisions will go some way to help improve an employer’s green credentials, it is important that other aspects of the business are not overlooked as part of a wider environmental policy.

4. Energy efficiency

One aspect which is likely to be the biggest contributor to a business’s carbon footprint, as well as potentially being one of the biggest financial burdens, is the energy efficiency of office building(s).

If office premises are rented commercial premises, and energy efficiency ratings are lower than a grade B, it is worth exploring this point with the landlord, as the 2015 Energy Efficiency (Private Rented Property) (England and Wales) Regulations (MEES Regulations) has set minimum standards for Energy Performance Certificates (EPCs) for private rented properties in England and Wales.

If a commercial lease is being granted now and may still be in place between 2027 and 2030, the terms of such leases should be considered carefully to ensure they contain provisions needed in order for the landlord to remedy any energy efficiency issues.

Alternatively, if the business owns its office building(s) outright, reviewing energy efficiency measures with a qualified surveyor would provide an insight into the most cost-effective actions that can be taken to improve the efficiency of the property.

Your competitive edge

There are many options available to businesses seeking to reduce their carbon footprint. Although some of these options may require some financial outlay for example installing solar panels or providing a cycle to work scheme, it is important that business owners consider the competitive edge they are likely to gain in attracting and retaining talent, alongside the role they can play in addressing climate change.

Additionally, in view of the growing appetite among the consumer market, it is further important that companies can back up any green credentials with internal policies.

If you would like to adopt an environmental policy for your business or you would like to update your employee contracts, please contact Harrison Drury’s employment law team on 01772 258321. If you would like further information regarding measuring and/or improving the energy efficiency of your commercial property, please contact Harrison Drury’s property team on 01772 258321.