Our Law Services
EMPLOYMENT: RIP STATUTORY PROCEDURES 2004-2009
Employment Act 2008
The Employment Act 2008 will come into force on 6th April 2009. Its biggest impact will be in repealing the compulsory statutory dispute, grievance and dismissal resolution procedures.
These procedures were initially introduced (in 2004) to help settle workplace disputes wherever possible, without going to a tribunal. However, these rules have been arguably impractical and have led to difficulties. These rules will now be replaced with a new (non-compulsory) ACAS Code of Practice.
The new Code provides basic practical guidance and sets out principles for handling disciplinary and grievance situations. Employers are not obliged to follow the Code, but tribunals will take it into account and will be able to adjust any awards by up to 25% (up or down) if an employer or employee unreasonably fails to follow any provision. This contrasts with the maximum of 50% under the current rules.
The Code will become the key source of guidance for tribunals in determining the fairness of any grievance or disciplinary process. The Code was approved on 12th March 2009 and a copy can be obtained from the ACAS website at http://www.acas.org.uk/index.aspx?articleid=2180
The salient points are set out below.
The Code
The Code sets out the fundamental principle that, whenever a disciplinary or grievance process is being followed, it is important to deal with the issues fairly. The Code provides guidance, including:-
• Employers and employees should raise and deal with issues promptly and should not unreasonably delay meetings, decisions or confirmation of those decisions
• Employers and employees should act consistently
• Employers should carry out any necessary investigations, to establish the facts of the case
• Employers should inform employees of the basis of the problem and give them an opportunity to put their case in response before any decisions are made
• Employers should allow employees to be accompanied at any formal disciplinary or grievance meeting (this remains compulsory)
• Employers should allow an employee to appeal against any decision made
Grievance
The Code lays down requirements for dealing with grievances, which are defined as 'concerns, problems or complaints' which an employee may raise. The Code’s requirements are as follows:-
• The employee should set out the grievance in writing
• The employer should then hold a meeting with the employee to discuss the grievance, without unreasonable delay
• The employer is to confirm the outcome of the meeting in writing to the employee and decide on appropriate action, if any, to be taken
• The employee should have the right to take the grievance further if not resolved, including the right of appeal
• Appeals should be heard without any unreasonable delay
• The outcome of any appeal hearing should be communicated to the employee in writing
Disciplinary
The Code sets out obligations for employers in relation to disciplinary issues, including:-
• Investigate disciplinary matters promptly and establish the facts
• Inform the employee of the problem in writing
• Where practicable, appoint different individuals to conduct an investigatory and disciplinary procedure
• Hold a meeting with the employee to discuss the problem without delay
• Confirm the outcome of disciplinary processes without unreasonable delay in writing
• Provide employees with an opportunity to appeal
• Hold a meeting regarding an appeal against disciplinary action without unreasonable delay
• Inform an employee of the outcome of their appeal as soon as possible
Dismissal
Should an employer dismiss an employee without complying with its obligation in the new ACAS Code, it will not necessarily result in the employee’s dismissal being automatically unfair, as is currently the position under the statutory procedures.
An employment tribunal will take into account the failure of an employer to follow a fair procedure in determining whether an employee’s dismissal was unfair. It is therefore likely that some flexibility will now be shown but the extent of this will not become clear for a while.
Presently, it is unclear if the Code will cover post-termination complaints, such as allegations of constructive dismissal.
Redundancy
The new Code will not cover redundancy-related dismissals, which have their own recommended procedures for employers to follow. This is a change from the current regime.
Other Differences
Unlike the current regime, the Code will apply to minor disciplinary proceedings including oral and written warnings. The Code will not apply to non-renewal of an employee's fixed term contract.
The Code imposes fewer obligations upon employees. Employees and their representatives should be aware that an employee must raise a grievance or appeal against dismissal without unreasonable delay; attend disciplinary and grievance hearings where possible; and not unreasonably delay the conduct of grievance and disciplinary meetings. The Code also encourages employees to call and question witnesses at disciplinary or grievance hearings, although they should give advance notice to the employer of the witnesses whom they intend to call.
Failure by an employee to follow the Code
Currently, under the rules of the statutory grievance procedure, an employee must raise their grievance and wait 28 days before presenting their claim to an employment tribunal. If the employee does not do so a tribunal will reject the employee’s claim. There will be no such bar on bringing proceedings under the new regime.
Other changes being introduced by the Act
Other significant changes brought about by the Act are:-
1. There are amendments to the National Minimum Wage Act 1998.
2. Section 98A of the Employment Rights Act 1996 is repealed so that where a dismissal will be deemed unfair on procedural grounds alone, a tribunal will be able to reduce or eliminate the compensation award to reflect the likelihood that the dismissal would have happened anyway had the fair procedure been adhered to.
3. The Employment Rights Act 1996 is amended to specifically state that a tribunal may, where it makes its declaration of an unlawful deduction of wages or determines that a redundancy payment is due, order the employer to pay the worker such amount as is considered appropriate to compensate him for any financial loss sustained by him which is attributable to the matter complained of.
4. An amendment to the Employment Tribunals Act 1996 will now allow tribunals to determine proceedings without a hearing. This can happen in the instances where all the parties consent in writing or the person against whom proceedings are brought has presented no response or does not contest the case.
How will the Act work in practice?
Having a procedure in place, and following it, will remain important for employers so that they can show that they have dealt with the issues fairly as required by the ACAS Code. However, few people will be sorry to see the statutory procedures abolished in favour of a more flexible approach. It will inevitably take some time before there are any decided cases on the new procedure, but we will provide updates once the principles start being applied in practice by tribunals.
If you have any questions or require any advice, please contact Andrew Koffman at andrew.koffman@salehs.co.uk or Matthew Gale at matthew.gale@salehs.co.uk.