Yes. All businesses, no matter how small, are required to include in their written statement of terms and conditions:
- details of the disciplinary (and grievance) procedures that apply to employees, or an indication of where employees can find and read them; and
- the name or title of the person to whom employees can apply if they are dissatisfied with disciplinary decisions, or want redress for grievances.
Your disciplinary and grievance procedures must be equivalent to, or better than, the procedures currently laid down by statute.
The statutory requirement, in any disciplinary matter which is likely to give rise to anything other than a warning or a suspension on full pay, is a three-stage procedure:
- the issue must be set out in writing;
- both parties must be given a chance to discuss it face to face; and
- the employee must be offered the opportunity to appeal against any finding.
It is advisable to apply these procedures even if you expect the disciplinary matter to result in no more than a warning. And they must certainly be applied to all dismissals, whether or not they are for disciplinary reasons. If you are planning dismissals for any reason, seek advice to check you are not in breach of these procedures.
Where an employee is dismissed for gross misconduct, the employer is in most cases required to use the three-stage procedure. But in a few cases (likely to be very few in practice) it may be acceptable to use a 'modified' two-stage procedure:
- the issue is set out in writing, with an indication of why the employee is believed to be responsible for it;
- the employee must be offered the opportunity to appeal against the dismissal.
There are circumstances in which employers may be exempted from the need to follow the statutory procedures, including:
- where the organisation is going out of business;
- where there are collective redundancies;
- where either party has reasonable cause to fear violence, abuse or intimidation likely to result in serious physical or mental harm (to themselves or to a third party), or damage to property;
- where either party is prevented from attending by circumstances beyond their control, for example long-term illness or residence abroad.
The three-stage procedures (there is also a three-stage procedure for grievances) were designed to check the flow of cases to the Employment Tribunals (although they have not had that effect - see below). If you fail to use them in a disciplinary case where they are required, however, or you use them improperly (for example, by producing a statement which is inaccurate or incomplete), the employee involved can complain to an Employment Tribunal and you risk an automatic finding in their favour, and an award against you which could be between 10 and 50 per cent higher than it would otherwise be.
Acas has produced a Code of Conduct (see www.acas.org.uk/publications/pdf/1/p/CP01.1.pdf), and a handbook (www.acas.org.uk/index.aspx?articleid=890) to guide you through the requirements. The web of requirements and exceptions, however, is complex, and the consequences of getting it wrong are serious. So if you are planning to overhaul (or introduce) disciplinary procedures, take legal advice.
The government has been consulting as to whether it should withdraw the statutory procedures, on the argument that it pushes people too soon towards formal, long-drawn-out and legal ways of dealing with disputes, rather than less formal and faster measures (such as mediation or other forms of alternative dispute resolution). A draft employment Bill has been put out for consultation following the Gibbons Review, a government-commissioned review looking at the whole question of employment dispute resolution. The Gibbons Review said that, under the present system, far too many disputes end up in front of Employment Tribunals; that it takes far too long for them to get there; that the whole procedure is far too costly for employers (an estimated average of £9,000 per case defended); and that it is also far too stressful and damaging (in terms of future work prospects) for employees). The draft Bill proposes, for sometime in 2008:
- Repeal of the statutory disciplinary and grievance procedures introduced in 2004.
- New powers for tribunals to adjust awards if there is unreasonable failure to comply with a Code of Practice (probably an updated version of the current ACAS Code on disciplinary and grievance procedures).
- Extended powers for ACAS to conciliate in disputes.
