It is almost universally agreed that the statutory dismissal and grievance procedures introduced in 2004 have failed in their stated objective of reducing the amount of claims going to employment tribunals.
With effect from 6 April they will be repealed, although the old rules will continue to apply in relation to dismissal and grievance procedures commenced prior to 6 April. (Where a grievance is not raised until after 6 April but concerns matters occurring wholly before that date, the old procedures will apply; the position is more complex in relation to grievances concerning matters that commenced prior to 6 April and carried on afterwards and expert advice should be sought where relevant).
Follow the ACAS Code
The repealed procedures will be replaced by an obligation to conduct disciplinary and grievance procedures in accordance with principles laid out in a new ACAS Code (Code). The Code is intended to provide the standard of reasonable behaviour in most cases.
Unlike the former regime a failure to follow the principles of the Code will not result in an automatically unfair dismissal for those employees with the requisite one years deemed continuous service. However, an unreasonable failure to comply with the Code may result in an uplift of up to 25% in any compensation subsequently awarded by an employment tribunal (or a reduction of up to 25% if it is the employee who has unreasonably failed to comply with the principles established). These adjustments to compensation apply both to claims for unfair dismissal and breach of contract claims as relevant.
The Code itself is a concise 10 pages and sets out principles most employers would regard as common sense best practice. Although the Code encourages employers to consider all forms of alternative dispute resolution, including the use of internal and external mediation, the core principles for the management of formal disciplinary and grievance processes are largely unchanged and few employers are likely to have to amend their current policies to accommodate the new regime.
Practical points to note
The Code does not apply to redundancy dismissals or non-renewal of fixed term contracts, although employers will still have to have regard to their general statutory obligation or reasonableness in these scenarios:
- The Code does apply to performance or capability issues as well as misconduct.
- The Code requires that where appropriate employees or employee representatives are involved in the development (or amendment) of clear written procedures. Measures should also be taken to ensure that all staff understand what the rules are and where copies of the procedures can be found.
- It is arguable that employers are no longer obliged to hear grievances raised by former employees, although there is some debate on this point and if it becomes a live issue before being clarified by case law detailed advice should be sought.
- The Code places an obligation on employers to inform employees of their right to be accompanied to disciplinary and grievance hearings (although this is established best practice, failure to do so may now prejudice the fairness of proceedings and increase liability).
- Employees should be given a reasonable opportunity to call relevant witnesses to disciplinary hearings.
- Where a grievance is raised during the course of a disciplinary hearing, if the two matters are related the Code accepts that it may be appropriate to deal with both issues concurrently.
- The Employment Tribunal Service is introducing a new simpler ET1 claim form for use in matters falling after the 6 April cut off, although during the transition period the old forms will still be in use for claims that fall under the old statutory dispute resolution regime.
The Code, which will remain marked draft until finally approved by Parliament but is not expected to change, can be accessed here.
- All staff involved in managing disciplinary and grievance matters should be briefed on the new Code and the importance of applying its principles.
- Care needs to be taken to ensure that matters are dealt with under the correct rules during the transition period. In some instances employers may wish to manage the timing of certain processes to ensure that they fall under the new regime.
- Although existing discipline and grievance policies that complied with the old statutory regime are likely to be sufficient to meet employers obligations going forward, there may be opportunities to simplify existing procedures.
- Employers should also consider whether more use can be made of alternative dispute resolution, for example by training internal mediators.
- From 6 April employees or employee representatives should be consulted on proposed changes to discipline and grievance policies and procedures.
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Content is for general information purposes only. The information provided is not intended to be comprehensive and it does not constitute or contain legal or other advice. If you require assistance in relation to any issue, please seek specific advice relevant to your particular circumstances.