The government’s Employment Bill proposal to completely scrap the statutory disciplinary and grievance procedures was hailed as great news for all those in human resources (HR) who had struggled with the unwieldy processes introduced in 2004.
The announcement was not surprising after the damning conclusions of the independent review by Michael Gibbons last year.
The irony is that the procedures were supposed to encourage informal and early resolution of disputes. The opposite happened.
The complexity of the rules and the harsh penalties for failing to follow even the most minor part of the statutory processes has given employers more need than ever before to seek external legal advice. The necessity to put a complaint in writing rather than discuss it informally, for example, has made some situations more problematic. No-one was surprised when tribunal claims rose by 15%, with many related to the interpretation of the statutory procedures.
The Gibbons Review recommended a combination of clear, simple, non-prescriptive guidelines for employers on how to resolve disputes and the provision of an incentive for following the procedures. There should also be flexibility over the individual circumstances of a case, he said. Gibbons said there should be a voluntary approach to encourage and enable greater use of alternative dispute resolution techniques to settle cases early, including more mediation.
The Employment Bill
All this sounds eminently sensible, but the government has still not published the results of the consultation following the Gibbons Review, leaving yet more uncertainty over any replacement system. The Employment Bill, however, does at least give some indication that the government is following Gibbons’ recommendations and the current procedures will be removed – much to everyone’s relief.
With the removal of the fixed conciliation periods, Acas will also have a bigger role to play. The Bill proposes a return to the pre-2004 position on procedural fairness, which will be, once again, governed by the ‘Polkey principle’, whereby in cases of unfair dismissal where an incorrect procedure has been followed, a tribunal can take into account whether an employee would have been dismissed in any event when assessing the losses due to the employee.
There is also a new proposal to give tribunals the discretion to increase compensation awards by up to 25% if an employer unreasonably fails to comply with a new statutory code of practice. This issue is likely to be the most contentious, as it risks going back to the painful problems of the current provisions, where every part of the process has to be followed in detail to avoid an increase in an award.
Surely this would be a retrograde step? Once again, it may well be the legal advisers who will flourish under the new regime.
Timetable for the future
The current statutory procedures will not be repealed until at least April 2009, and the government’s track record of introducing controversial legislation on time is not particularly encouraging – for example, the Transfer of Undertakings (Protection of Employment) Regulations 2006 were several years late.
In the meantime, we are stuck with the current burdensome procedures, and employers will need to keep a vigilant eye on case law to ensure they comply.
The good news is that what will take the place of the current provisions could hardly be worse than what we have now. Crucially, the government must deliver the greater powers it promises to Acas and make sure the new code is simple and effective enough to put a stop to the pain it that has already been caused by existing procedures.
- Government yet to publish the results of the public consultation.
- Return to pre-2004 position in relation to procedural fairness.
- Tribunal discretion to increase awards by 25% if new code is ignored.
- Acas to play a greater role in dispute resolution.
- Employers stuck with current procedures until April 2009.