Discipline and Grievance Procedures
Employment Law - Statutory Discipline and Grievance Procedures - A new departure
On October 1st. 2004 a whole new statutory code under the Employment Act 2002 (Dispute Resolution) Regulations 2004 comes into force. All those concerned with employment matters must familiarise themselves with the content or ignore at their peril.
The present position
To avoid a finding of unfair dismissal of a qualified employee, the employer must show the reason for the dismissal and that it is a reason falling within the permitted reasons - e.g. conduct or capability (lack of performance) and a Tribunal must then decide if in all the circumstances of the case the employer acted reasonably in treating that reason as a sufficient reason for the dismissal. This usually means that the employer must follow a fair procedure. Whilst the current ACAS Code of Practice may be taken into account in deciding whether the employer acted fairly, failure to follow the Code does not mean that a dismissal is automatically unfair. There is therefore a measure of uncertainty as to whether an employer acted fairly and followed fair procedures.
The new statutory code
On the 1st. October 2004 the present position will change dramatically. Failure to follow the statutory code will normally make a dismissal automatically unfair.
Disciplinary and Grievance matters
This first relates to an action taken by an employer, the second by an employee.
Disciplinary procedures must be followed where an employer contemplates taking relevant disciplinary action in relation to alleged misconduct or unsatisfactory performance. This refers to most forms of disciplinary action e.g. dismissal, demotion, loss of seniority etc other than suspension on full pay and oral or written warnings.
There is both a standard (used in most cases) and a modified procedure (used in cases of gross misconduct justifying dismissal without notice or payment in lieu of notice).
The standard procedure
This consists of three stages known as steps.
Step One - Write to the employee notifying him or her of the allegations and the basis of the allegations and invite him/her to a meeting to discuss the matter.
Step Two - Hold a meeting to discuss the allegations at which the employee has the right to be accompanied and notify the employee of the decision.
Step Three - If the employee wishes to appeal hold an appeal meeting at which the employee has the right to be accompanied and inform the employee of the final decision.
Those wishing to know more detail should consult Annex A of the new ACAS Code of Practice relating to Disciplinary and Grievance procedures dated June 2004 but coming into force at the same time as the Dispute Resolution Regulations on the 1st. October 2004 ("the June Code"). The June Code is available on the ACAS website at the following address:- http://www.acas.org.uk/publications/pdf/cp01.2.pdf
The modified procedure
This applies to a situation where an employer considers an employee guilty of gross misconduct which would potentially justify dismissal without notice or pay in lieu. Employers must never underestimate the importance in such a case of giving the employee the opportunity of putting their case at a disciplinary meeting before taking action. A prudent employer will in the normal case always follow the standard procedure, even in cases of alleged most gross misconduct. In a very limited number of cases however dismissal without a preliminary investigation or meeting may be found to be fair and to allow for this there is a statutory modified procedure under which the employer is required to write to the employee after the dismissal setting out the reasons for the dismissal and to hold an appeal meeting if the employee wants one. More details are found in Annex B of the June Code.
What if these procedures are not followed?
Unless there are exceptional circumstances, e.g. exposure to violent, intimidatory or abusive behaviour, the parties must follow them. Failure to comply with the statutory procedures without a permissible reason (i.e. in nearly every case) will in a subsequent claim by a qualified employee for unfair dismissal mean that the Employment Tribunal will automatically find the dismissal unfair. In addition, the Tribunal will normally increase the compensation awarded by 10%, but where it feels it just and equitable to do so, by up to 50%. However, if an employee has himself or herself failed to follow the procedure e.g. by failure to attend a meeting without good cause, the same percentage reductions will apply to their compensation.
It is emphasised that these are minimum procedures which must be followed. Good employment practice will deal with oral and written warnings and suspensions on full pay which are not covered by these statutory codes. The reasonableness test will apply all the way through and expert advice may be needed on drawing up the proper procedures.
Grievance procedures concern problems or complaints that employees may raise with their employers and the procedures used by employers to deal with them. These may concern bullying and harassment, equal opportunities, terms and conditions of employment, health and safety etc.
As with disciplinary matters the Act lays down a standard and a modified procedure.
The standard procedure
Once again this is in three stages called steps.
Step One - Here the employee initiates the process by informing the employer of their grievance in writing.
Step Two - The employer invites the employee to a meeting to discuss the grievance where the right to be accompanied will apply. The employee must take all reasonable steps to attend. The employer must notify the employee of the decision in writing.
Step Three - The employee must be given the right to an appeal meeting if he or she feels that the grievance has not been satisfactorily resolved and be notified of the final decision.
Further detail is set out in Annex C of the June Code.
Where the employee is still in employment the standard grievance procedure should be used. Exceptionally, where an employee has already left employment the modified procedure may be used where the standard procedure has not been started or completed and both parties agree in writing to use the modified procedure.
The modified procedure
Under this procedure the employee should write to the employer setting out the grievance and the employer must write back setting out his response.
Time limits
The normal time limit within which an application must be made to an Employment Tribunal is 3 months from the date of the dismissal or of the act complained of. However, there is a radical new provision in relation to claims under Section 32 of the Employment Act 2002 (complaints about grievances) namely that before the employee can present a claim to a Tribunal relating to the subject matter of the grievance he or she should, subject to certain exceptions, have raised the grievance in writing and then waited 28 days before applying to the Tribunal. Failure to do so may result in the Tribunal rejecting the application.
Where a grievance does come before an Employment Tribunal the penalties for increasing/reducing the award where a party has failed to follow the procedure are the same as apply to the Disciplinary Code - i.e. normally 10% increase/reduction but may be up to 50% increase/reduction.
Conclusion
It is essential that both employers, their Human Resources Departments and advisers and employees and their advisers get to grips with the new statutory provisions. All employers must not delay in revising their written procedures and ensuring that they are compliant with the new statutory requirements. They would do well to study the June Code where full information is given and take all necessary advice. Failure to do so could have some very unpleasant and expensive, but not now unforeseen, consequences.
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