The statutory disciplinary dismissal and grievance procedures are replaced with ACAS Code-based procedures. What should you do next?
As you probably know, the statutory disciplinary, dismissal and grievance procedures will be repealed on 6 April 2009. These much disliked procedures will be replaced by disciplinary and grievance measures outlined in an ACAS statutory Code of Practice. Although you will not be obliged to adhere to the terms of the Code, tribunals will take into account the terms of the Code, when considering an employee's claim (e.g. for constructive unfair dismissal).
We reviewed the provisions of the new Code in our November 2008 briefing.
The government has introduced transitional provisions, aimed to help employers decide when they need to use the statutory procedures and when the Code procedures should be applied to deal with discipline, dismissals and grievances which occur close to the repeal date of 6 April 2009. The transitional provisions are quite complex and, as a result, for quite some time, you are likely to have to run the two procedures in parallel. Whenever a discipline or grievance issue comes up, you will have to identify the correct procedure.
When you first look at the Code procedures, you may wonder whether it changes anything. To a large extent, the statutory procedures and the Code procedures are very similar. However, as is often the case in employment law, the devil is in the details and there are a number of crucial differences which we want to highlight, to save you making costly mistakes.
Transitional provisions are in place to help you decide which procedure to use during a transitional period.
If you plan to start disciplinary or dismissal procedures or if a written grievance lands on your desk, over the next few weeks, you must decide whether to apply the statutory procedures or the Code procedures. Choosing the wrong procedure may result in a claim by a disgruntled employee, which can be costly.
In brief, if you take any disciplinary or dismissal-related action on or before 5 April 2009, you must use the statutory procedures.
Most complaints about grievances which are begun on or before 5 April will also have to be dealt with under the statutory procedure. The transitional grievance procedures are very complex, however, and we suggest that you take legal advice if you deal with a grievance.
In all other instances, as of 6 April 2009, you will need to use the Code procedures.
In a few instances, you may want to choose the more favourable procedures, at least during the transitional period. For example, if you expect to issue an employee with a warning, you may prefer to do so before 5 April 2009, since warnings are not governed by the statutory procedures. If, however, you expect to make (less than 20) employees redundant, you may elect to wait until 6 April 2009, when the Code procedures (and lower award adjustments in case of failure to comply) apply.
It is fairly common for employees to raise a grievance after you begin disciplinary proceedings against them. Depending on the date on which the disciplinary procedure begins and the date of the employee's complaint, it is possible that you will have to conduct the disciplinary procedure under the statutory regime but deal with the grievance under the Code. There is no escaping the fact that, for a period of time, before you do anything, you must decide what procedure to use. This can be a complex issue and we suggest that you give us a call if you are at all uncertain about the applicable procedure.
The statutory and Code procedures are not identical. You should review your procedures and consider whether amendments are required.
The structure of the Code procedures is very similar to the statutory procedures and, by and large, you can continue operating a three-stage, "letter-meeting-appeal", system. There are, however, some important differences between the two procedures which may lead you to amend your procedures and the action you take under them. Ideally, you should read the ACAS Code and supplementary guidance, decide whether you need to amend your procedures and, crucially, re-train managers on how to handle disciplinary/grievance issues. The following issues may lead to change in procedure and/or practice.
Timely action. The Code requires employers and employees to take action without 'unreasonable delay'. Failure to do so can amount to breach of the Code and a consequential award adjustment of up to 25%. Now is the time to remind managers to act promptly when dealing with disciplinary and grievance issues.
Ex-employees no longer covered. The statutory procedures applied to ex-employees and, under these procedures, you need to take certain action (e.g. write a letter and hear an appeal) after the employment ended. For example, an employee can appeal against his/her summary dismissal and you must hear and decide the appeal. However, the Code does not appear to apply to ex-employees generally (e.g. if an ex-employee raises a grievance about their employment after it has ended).
Redundancies and fixed term contracts. The Code procedures do not apply to redundancy dismissals or non-renewal of fixed-term contracts (which the statutory procedures do cover). As a result of this change, in redundancy dismissal cases you will have to comply with a separate ACAS Advisory Booklet on Handling Redundancy. When you decide not to renew a fixed-term contract, you may simply inform the employee of this fact sufficiently in advance by letter. (However, you must be careful not to discriminate against fixed-term employees). Again, if your internal procedures reflect the statutory procedures, it is a good idea to amend them to take account of the changes brought in by the Code.
Require formal grievances to be in writing. The Code procedures apply to written grievances which the employee is required to raise "without unreasonable delay with a manager who is not the subject of the grievance". It may be a good idea to amend your existing procedures to reflect this requirement. You can deal with informal (unwritten grievances) outside the Code procedures. Bear in mind, however, the broad definition given in the Code to the term grievance, as reported in our November 2008 Briefing.
The Code requires employers to involve employees or their representatives in the development of procedures. "Employees and, where appropriate, their representatives should be involved in the development of rules and procedures. It is also important to help employees and managers understand what the rules and procedures are, where they can be found and how they are to be used" (paragraph 2, page 4).
To comply with the Code, you will need to involve employees and their representatives in the development of any rules or procedures that takes place on or after 6 April 2009. The Code does not say what form and extent of involvement is required, but our view is that you may need to do more than inform employees or their representatives of the changes. You will probably have to, at least, let them comment on the changes, but we do not believe that you are obliged to take account of their feedback. Where possible, you may decide to amend your procedures before 6 April 2009, before this requirement comes into force. Watch this space Over the next few months you, us and employment tribunals, will have to review and understand how the Code procedures apply in practice. We hope (but are not fully convinced) that much of the uncertainty of the statutory procedures will be avoided.
ACAS Code on Discipline and Grievance
ACAS Guidance on Discipline and Grievance
ACAS Advisory Booklet: Handling Redundancies
Nabarro Employment Briefing November 2008