Mind Your Own Business

Employment law is forever changing and not keeping up to date on the latest developments can have far reaching consequences for employers and employees alike. From October 2004 new rules regarding disciplinary, dismissal and grievance procedures will be introduced and both employers and employees will need to ensure they understand the changes and how they affect the workplace.

What is intended?
The new statutory procedures are intended to improve dispute resolution in the workplace thereby reducing the number of tribunal claims and the cost to the public and the parties involved. Although this article highlights the new rules it is crucial that employers and their employees familiarise themselves fully with the new rules and how to implement them.

Employees
As a result of the statutory grievance procedures employees will have to inform their employers in writing if they wish to formalise a grievance (although informal resolution of complaints will continue to be encouraged). If they fail to formalise their grievance in this way, they will be prevented from bringing a claim against their employer arising from the subject matter of the grievance.

There will also be both "standard" and "modified" grievance procedures. The modified procedure will apply to grievances by former employees, if:

· the parties agree in writing that it should, and if either the employer was unaware of the grievance before the employment ended; or

· the employer was aware of the grievance but the standard grievance procedure had not been commenced or completed before the employment ended.

In certain circumstances, including where the grievance is that the employer has dismissed or is contemplating dismissing the employee, neither procedure will apply.

Employees instigating the grievance procedure will not be allowed to lodge claims at the Employment Tribunal for 28 days afterwards, to give employers time to deal with the complaints. There will also be an extension to time limits for employees to issue claims at the Employment Tribunal which takes into account the new procedures. For example, where employees file grievances within the normal time limit for bringing a claim in the Employment Tribunal (usually 3 months from the act complained of) the time limit for bringing the claim will be extended by three months. The same will apply if the employee presents a claim at the Employment Tribunal out of time but believes that a dismissal and disciplinary procedure is being followed.

Employers
Employers will have to follow the statutory dismissal and disciplinary procedures where they wish to dismiss an employee or to take action on grounds of conduct or capability. It will be automatically unfair to dismiss employees without first following such a procedure and any employees dismissed in these circumstances will be entitled to claim a minimum of four weeks' pay as compensation.

When dismissing or disciplining an employee, employers will have to adopt either a "standard" or a "modified" procedure. The modified procedure will apply to cases of gross misconduct. There will be limited exceptions where neither procedure will apply, such as where continued employment would contravene a legal duty or restriction.

Written particulars of employment must set out the procedure that applies to any decision to dismiss or discipline an employee (or refer to a document, such as an employee handbook, which contains the procedures, and which is reasonably accessible to the employee).

Exemptions
In certain situations, such as where either party fears a significant threat from the other, there will be an exemption from the requirement to adopt either statutory procedure. There will also be circumstances in which the parties will be treated as having complied with the procedures even if they have not done so.

Failure to comply
If the relevant statutory procedures are not followed, tribunals will be entitled to increase any compensatory award that they decide to make, by between 10 and 50 per cent, if the failure to comply was wholly or mainly attributable to the employer. If the failure was wholly or mainly attributable to the employee, tribunals will be entitled to reduce any compensatory award by between 10 and 50 per cent.

Employers should therefore take steps now to review contracts and procedures in the light of the imminent changes. It is important that managers and Human Resources staff are made aware of the new procedures and are trained appropriately on how to implement them. Employees should also be made aware of the procedures and how to use them.

By Anthony Sakrouge & Victoria Hubert
Employment Law Department

This article first appeared in South East Business Magazine magazine.