Introduction  

  • On 13 November 2008 the Employment Act 2008 received Royal Assent and consequently the legislation which gave us the statutory dispute resolutions procedures, will be repealed (with a sigh of relief from all!). The dispute resolution procedures were found by an independent review to have an unnecessarily high administrative burden on both employers and employees.  
  • A new ACAS Code of Practice on Disciplinary and Grievance Procedures (“the code”) is intended to replace the statutory procedures. The changes are expected to take place on 6 April 2009.  
  • So, what does this all mean in practice? The intention behind the statutory procedures was to promote the resolution of workplace disputes (albeit it seemed to have the opposite effect), and that remains Parliament’s intention. There are still therefore intended to be incentives for parties to comply with certain steps and penalties for unreasonable behaviour. Tribunals will have the power to adjust awards for unreasonable failure to comply with ‘any provision’ of the code and so our advice is to follow the code and ensure all relevant company policies and procedures incorporate the code.  

Summary of Changes

Time limits  

Position under the statutory procedures  

The statutory procedures gave claimants a three month extension of time to bring a tribunal claim where they had submitted: a grievance within three months; or a claim within three months but no grievance and had a reasonable belief that the procedure was ongoing.  

The law does not state that you must pay but it is common practice to do so. Since the employee must receive advice for the compromise agreement to be valid, the employer has an interest in making sure that the advice is properly given. It is of course sensible to set a limit to the contribution to legal fees.  

Position from April 2009  

The extra set of extensions to the time limits will be removed and we will return to the pre-2004 position whereby most applications must be presented within three months (six months for equal pay and redundancy).

Redundancies  

Position under the statutory procedures

The statutory procedures encompass terminations of employment which take effect as a result of redundancy or the expiry of a fixed-term contract.  

Position from April 2009  

The code does not apply to dismissals by reason of redundancy – a fair consultation process will still have to be followed. The code does not apply to the nonrenewal of a fixed-term contract.  

Grievances  

Position under the statutory procedures  

An employee cannot bring a claim for constructive dismissal or discrimination unless he/she has raised a grievance and waited 28 days.  

Position from April 2009  

There will be no requirement to raise a grievance before bringing an employment tribunal claim and so the arguments surrounding the definition of grievance should subside.  

The grievance procedure under the code is not very different to the statutory procedure we are all familiar with.  

Where grievances and disciplinaries meet  

Position under the statutory procedures  

There has been much confusion where the grievance procedures and the disciplinary procedures have overlapped. Employers have been forced to hold excessive meetings through fear that they might fall foul of the procedures.  

Position from April 2009  

The code makes it clear that should an employee bring a grievance during a disciplinary procedure, the procedure may be put on hold while the grievance is dealt with. However, if the grievance relates to the disciplinary action, they may be dealt with simultaneously.  

Don’t forget the procedure!  

Position under the statutory procedures  

A dismissal is automatically unfair if the statutory procedure is not followed. If the employer follows the statutory procedure but fails to follow an additional requirement as part of it’s own procedure, the dismissal can be found to be fair.  

Currently an employer who blatantly fails to follow any procedure can argue that the dismissal would have taken effect anyway and seek a reduction in compensation of 100%, whereas an employer who follows the statutory procedure can only seek a reduction of 50%. The employer who blatantly disregards procedures may in fact be better off!  

Position from April 2009  

Automatic unfairness for failure to follow a statutory procedure will be removed.  

Under the code if an employer fails to follow it’s own fair procedure the dismissal will be unfair even if it complied with what was the statutory procedure and even if the failure would not have altered the outcome (following the Polkey case law).  

Under the code this injustice is replaced with a fairer and simpler system whereby compensation can be reduced to reflect the likelihood of dismissal where there has been a procedurally unfair dismissal.  

It’s all down to money!  

Position under the statutory procedures  

Tribunals can increase or decrease awards by between 10 and 50% for failure to follow the statutory procedures. Research shows that awards have been reduced in only a handful of cases, whereas tribunals have increased awards frequently.  

Position from April 2009  

Tribunals will have scope to increase or decrease awards by up to 25% for failure to follow the code. Action  

  • Policies and procedures should be revised in readiness for 6 April 2009 to ensure they comply with the code. Although the code is more straightforward than the statutory procedures, it does require a basic level of fairness and employers (and maybe even employees!) will be penalised for a failure to comply.  
  • The code recommends a separate policy on bullying, harassment, whistleblowing and collective grievances and so employers should ensure these policies are drafted separately.
  • Revising policies is not sufficient. Employees should be made aware of and where appropriate trained on the amended policies.  

The code encourages informal resolution of disputes, however where this is not possible it suggests using an independent third party or an external mediator. Consideration should be given to encouraging these methods of dispute resolution.  

In Summary  

  • Issues should be dealt with promptly and consistently.
  • Investigations should be thorough.  
  • Employees should be kept informed and given the opportunity to put their case forward.  
  • Employees should be offered the right to be accompanied at any formal disciplinary or grievance meeting (this right does not have to be extended to investigatory meetings)  
  • Employees should have the opportunity to appeal.  
  • Nothing groundbreaking there then, just a welcome relief from the complexities and nuances of the last four years!