Print this pageDismissal Law - All Change
2009 saw the introduction of some important changes to dismissal law which will affect the way employers should handle dismissals, disciplinary and grievance issues. In this article we look at those changes.
The Position Prior to 6th April 2009
In 2004 measures were introduced to try to reduce the number of Employment Tribunal claims by encouraging employers and employees to resolve disputes in the work place rather than in the Employment Tribunal.
Whilst the aims of the provisions were sensible, the provisions themselves have proved to be controversial and have been much criticised. This led to a wholesale scrapping of most of the essential features of the old regime with effect from 6th April 2009.
The main features of the old regime were:
- A mandatory procedure that an employer had to follow whenever he/she considered dismissing or taking disciplinary action against an employee. The procedure comprised of three steps: a letter from the employer, a meeting and an appeal
- A mandatory procedure that an employer had to follow when dealing with grievances. Again this comprised of three steps: a grievance letter from the employee, a meeting and an appeal
- An employer who failed to follow the mandatory procedure before dismissing an employee was in an extremely vulnerable position. Under the old regime such dismissals were automatically unfair
- An employer who failed to follow the mandatory dismissal or grievance procedure could also be punished by an Employment Tribunal for this failure. The Tribunal had the power to increase awards of compensation by up to 50%
- There were complex provisions which required employees to raise complaints with their employers through the grievance procedure before they could take a case to an Employment Tribunal
These provisions were much criticised for various reasons. They produced very harsh results for an employer who made a slight procedural mistake. An employer in this situation would find the resulting dismissal to be automatically unfair with the added potential for a significant increase in compensation for what might have been a relatively minor 'technical' slip.
The procedures were also criticised for their complexity and for prompting more litigation and uncertainty rather than less.
This pressure prompted the government to introduce two key changes:
- The introduction of the Employment Act 2008. This came into force on 6th April 2009 and repealed most of the controversial provisions that were introduced in 2004
- The introduction of a new version of the ACAS Code of Practice on Disciplinary and Grievance Procedures
The Employment Act 2008
The Employment Act 2008 came into force on 6th April 2009.
The main effect of the Act is to repeal the much criticised Statutory Dispute Resolution Procedures that were introduced in 2004.
The main implications of the changes are:
- A procedural failing on the part of an employer will no longer automatically render a dismissal unfair. The Employment Tribunal will still be able to take a view of the overall fairness of the dismissal in such cases
- The power of Employment Tribunals to increase awards by up to 50% for a failure to follow the statutory procedure is removed
- There will be greater emphasis on the importance of following the ACAS Code of Practice on Disciplinary and Grievance Procedures. An Employment Tribunal will be able to increase or reduce awards of compensation by up to 25% (depending on whether the employer or employee is at fault) where it considers there has been an unreasonable failure to follow the Code of Practice
- The involvement of ACAS in Employment Tribunal cases will be extended. The duty of ACAS to conciliate between the parties will be extended to run right up to the point where an Employment Tribunal judgement is delivered
- Employees will be able to bring a claim to an Employment Tribunal without first having to raise a grievance with their employer
The ACAS Code of Practice for Disciplinary and Grievance Procedures
The ACAS Code of Practice has always been regarded as essential reading for any employer who is considering dealing with disciplinary and grievance issues. It is the yardstick that the Employment Tribunal uses to measure an employer’s conduct in such cases. An employer who fails to follow the Code of Practice does so at his or her peril.
The old ACAS Code of Practice for Disciplinary and Grievance Procedures dated back to 2004. The 2004 Code of Practice was the fourth version of the Code that was originally produced by ACAS in 1977.
ACAS were asked to review and update their Code of Practice. The new Code of Practice should be followed after 6th April 2009.
The new Code of Practice has been revised to take into account the removal of the statutory dismissal and disciplinary procedures. It aims to encourage businesses and individuals to resolve disputes internally, saving money and time.
The revised Code is much shorter than the 2004 version and provides practical guidance to employers, employees and their representatives to handle disciplinary and grievance situations in the workplace.
Employment Tribunals will compare an employer’s conduct with the Code of Practice when considering Employment Tribunal claims.
An employer who dismisses without following the Code of Practice is likely to lose an unfair dismissal claim.
The importance of the Code of Practice has been enhanced by the new provisions of the Employment Act 2008 which give the Employment Tribunal the power to increase or decrease an award of compensation to penalise a party who fails to follow it.
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For further information please contact Andrew Spencer on 01603 724671 or email ajspencer@cozens-hardy.com.
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