How do I get rid of my lazy but litigious HR director?

I have a problem with my HR director, who I inherited from my predecessor. She is lazy and incompetent, has alienated her team, and her (talented) number two has just quit. She takes a huge amount of sick leave, claiming the job is "stressful". I need to get rid of her but she knows all the rules and has a litigious frame of mind. She is from an ethnic minority and, although born to middle-class Indian parents, seems to believe life has discriminated against her. She views me, a white male, as a personal affront. What do I do?

Chief executive, male, 51

LUCY'S ANSWER

You must decide if you want to spend management time sorting this out or whether to lavish money on it instead.

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