Two recent cases decided at Tribunal have highlighted the need for Employers to adhere to the ACAS Code of Practice, and failure to do so could result in a costly error.
What is the Code of Practice?
The Advisory, Conciliation and Arbitration Service (ACAS) codes of practice on disciplinary and grievance procedure are advisory documents approved by parliament and provide for the minimum standard that employers are expected to meet when handling grievance or disciplinary issues. They are used by employment tribunals as a ‘benchmark’ of minimum standards when deciding relevant cases.
Code 1 provides guidance to employers, employees and representatives to deal with discipline and grievance issues that arise within the workplace.
• Disciplinary situations can include misconduct and/ or poor performance. Employers may have a separate capability procedure which they might prefer to utilise when addressing performance issues. If so, however, the basic principles of fairness set out in this Code should still be followed, albeit that they may need to be adapted.
• Grievances are concerns, problems or complaints raised by employees with their employers.
ACAS have very helpfully published a guide to Discipline and Grievances at Work (available here Discipline and Grievances at work acas.org.uk. The guide offers a step-by-step walkthrough of the of the Code. There is a very strong emphasis on the promotion of fairness within the Code, and therefore employers will need to ensure that any disciplinary or grievance procedures are conducted fairly and transparently, this includes, but is in no way limited to:
• 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.
• Employers should allow an employee to appeal against any formal decision made.
Consequences of non-compliance with the Code
The ACAS codes are guidelines only and therefore not mandatory, as such a breach of, or failure to adhere to a code will not in itself give rise to legal proceedings. That being said, employers are expected to follow the guidelines, and failure to do so can result in adverse consequences. An employer who has not followed the guidelines within the code of practice may be subject to the tribunal awarding an uplift of up to 25% on any compensation awarded in light of a party’s non-compliance with the ACAS standards.
Two recent decisions illustrate this point well. The first is the case of Rentplus v Coulson. The Claimant who brought a claim for unfair dismissal was awarded a full 25% uplift on the compensation awarded. The tribunal found that ‘the procedure adopted by the respondent before dismissing the claimant was a total sham’ and that there were failings in the redundancy and disciplinary and grievance procedures that were so egregious that a full uplift was therefore warranted.
In the case of Burn v Alder Hey Children’s NHS Foundation Trust (2021) the Court of Appeal expressed a strong provisional view that there could be a stand-alone implied term that disciplinary processes will be conducted fairly. Whether the duty to conduct disciplinary procedures fairly is an independent implied term or an aspect of the implied term of trust and confidence is what is of potential significance here. A breach of trust and confidence is a high bar, which can constitute a repudiatory breach. This decision may therefore blaze a trail to the recognition of an important, yet discrete, implied obligation of procedural fairness in all contracts of employment.
Therefore, while it is not only best practice to have full and fair procedures in place, it can also be costly not to.
How can we help?
We would advise that all employers regularly review their disciplinary and grievance procedures.
We can help by providing assistance in relation to the initial drafting or review of your procedures, policies or employees’ handbooks.
We can also offer assistance in advising on or conducting disciplinary or grievance hearings.