Disciplinary procedures

In this series, we delve into the XpertHR reference manual to find essential
information relating to one of our features. This month’s topic…

Future developments

The Employment Act 2002, Part 3 concerning dispute resolution is expected to
come into force on 1 October 2004. All employers, regardless of the number of
people they employ, will then be required to develop and make available to
their employees minimum statutory dismissal and disciplinary procedures (DDPs)
for dealing with allegations of misconduct and poor performance in the

There will be a standard three-stage DDP and a modified two-stage one. The
standard procedure will apply when an employer wishes either to dismiss an
employee or to take action against an employee on grounds of conduct or
capability. The modified procedure will apply in limited circumstances,
including where the dismissal is necessitated by circumstances outside the
employer’s control, or where there is an immediate gross misconduct dismissal
in the exceptional circumstances where such a dismissal would be found to be
fair by an employment tribunal. The procedures will be imported into every
contract of employment as an implied term from which it will be impossible to
contract out.

When an employee is dismissed in circumstances in which an employer failed
to follow the statutory minimum procedure, the dismissal will be held to be automatically
unfair. Likewise, a complaint to an employment tribunal concerning the fairness
of an employee’s dismissal will be ruled inadmissible if the evidence shows
that the employee in question refused or failed to submit to the statutory
procedure, for example in circumstances in which they claim to have been
constructively dismissed. If either party has not completed the relevant
procedure, the tribunal will be duty bound to increase or decrease any
subsequent compensation for unfair dismissal by between 10 and 50 per cent,
depending on which party is at fault.

The time limits for bringing certain proceedings will be extended to enable
the parties to those proceedings to complete the relevant statutory DDP.

In unfair dismissal cases, employment tribunals will once again be permitted
to disregard procedural mistakes, beyond the statutory minimum DDPs, if an
employer’s failure to follow the full internal disciplinary procedure would
have made no difference to the outcome.

The closing date for submissions on the proposals is 29 October 2003.

Acas code of practice

The Acas Code on Disciplinary and Grievance Procedures provides practical
guidance on how to deal with disciplinary and grievance issues in employment,
and on the statutory right of workers to be accompanied at a disciplinary or
grievance hearing. Although employers are not liable to proceedings for failing
to follow the guidance laid down in the Code, its provisions are admissible in
proceedings before an employment tribunal and may be taken into account in
determining the fairness or otherwise of an employer’s decision to dismiss an
employee. The Code can be accessed at www.acas.org.uk/publications/pdf/CP01.pdf

An employer’s disciplinary procedure should be regarded primarily as a means
of helping and encouraging improvement among employees whose conduct or
performance is unsatisfactory, rather than a means of imposing sanctions. The
Acas Code reminds employers that when drawing up a disciplinary procedure, they
should have regard to the requirements of natural justice. Minor cases of
misconduct and most cases of poor performance may be best dealt with informally
(for example through advice, coaching and counselling) rather than through the
formal disciplinary procedure.

If the formal disciplinary procedure is to be invoked, the employee should
be informed in advance of the allegations, together with any evidence to
support them, and should be given an opportunity to challenge these before a
decision is reached. They should also be given the right of appeal.

A good disciplinary procedure should:

– be in writing

– specify to whom it applies

– be non-discriminatory

– provide for matters to be dealt with without undue delay

– provide for proceedings, witness statements and records to be kept confidential

– indicate the disciplinary action that may be taken (for example a brief
period of suspension without pay, demotion, a cut in pay, or a transfer to
another department)

– specify which levels of management have the authority to take the various
forms of disciplinary action

– provide for staff to be informed of the complaints against them and, where
possible, all relevant evidence before any hearing

– provide staff with an opportunity to state their case before any decision
is reached

– remind workers of their statutory right to be accompanied at the formal
stages of the disciplinary procedure

– ensure, except for gross misconduct, no employee is dismissed for a first
breach of discipline

– make sure disciplinary action is not taken until the case has been

– ensure employees are given an explanation for any penalty imposed

– provide a right of appeal – normally to a more senior manager – and
specify the procedure to be followed.

The disciplinary procedure

The Acas Code suggests a minimum three-stage disciplinary procedure.

Formal verbal or written warning: A note or copy should be kept but
should be disregarded for disciplinary purposes after a specified period, eg
six months.

Final written warning: This should detail the nature of the
misconduct or poor performance; specify time limits for improvement; caution
the employee that they are liable to be dismissed if there is no measurable
improvement; and remind the employee of their right to appeal. A copy should be
kept, but should normally be disregarded for disciplinary purposes after a
specified period, eg 12 months.

Dismissal or other sanction: The final step might be a disciplinary
transfer, suspension without pay, loss of seniority, a cut in pay, forfeiture
of the next incremental payment (where these penalties are allowed for in the
employment contract), or dismissal. A decision to dismiss should be taken only
by the appropriate designated senior manager or director and should be relayed
to the employee in writing as soon as is reasonably practicable. The letter
should specify the reasons for the dismissal, the date on which the dismissal
is to take effect, and the appropriate period of notice (or pay in lieu of
notice). It should remind the employee of their right of appeal.

Appeal: A timescale for lodging and hearing appeals should be set –
the Acas Code suggests five working days for lodging an appeal. Appeals should
be heard, where possible, by a senior manager not previously involved in the
disciplinary process. It may be appropriate to adjourn the appeal to consider
any new evidence. The employer should inform the employee in writing of the
result of the appeal and reasons for it as soon as possible after it has
reached a decision.

Action point checklist

– In light of the dispute resolution
provisions of the Employment Act 2002, which are expected to come into force in…
October 2004, review disciplinary rules and procedures to ensure they do not
fall outside the framework of the new minimum statutory dismissal and
disciplinary procedures

– Understand that, while employers are under no strict legal
obligation to have a disciplinary procedure and rules in place, without these
you may find it difficult to satisfy an employment tribunal that a dismissal
was fair

– If you have 20 or more employees, ensure the written
statement of terms and conditions issued to them includes details of the person
to whom they can apply if dissatisfied with any disciplinary decision relating
to them

– Consult the Acas Code of Practice on Disciplinary and
Grievance Procedures for practical guidance on how to deal with disciplinary

– Make employees aware of the likely consequences of breaking
the company’s disciplinary rules, and give them a clear indication of the types
of behaviour likely to be regarded as gross misconduct

– Remember, though, that in most cases allegations of gross
misconduct will still need to be investigated before a decision is taken to

– Ensure employees are given the opportunity to appeal against
any disciplinary decision taken against them

– Remind all workers (and not just employees) that they have
the statutory right to be accompanied at each of the formal stages of the
disciplinary procedure

Questions and answers

Do employers have the right to dismiss employees without

Employers should give a clear indication of what kind of
behaviour will be taken to be such a serious breach of contract that it will
result in summary dismissal – for example, bullying and harassment, violence,
drinking on duty, theft, and so on. However, in most cases an employer should
still carry out a thorough investigation of the circumstances before taking the
decision to dismiss.

It may suspend the employee on full pay if its investigations
are likely to take time. It should ask if there were any mitigating
circumstances, what the employee has to say for themselves, and whether the
behaviour was uncharacteristic, given their service and record. If satisfied
that the employee is guilty, the employer may then dismiss without notice,
reminding the employee of their right to appeal if they think the treatment is

Are employers under an obligation
to have a disciplinary procedure and rules in place?

At present, employers are under no strict legal obligation to
develop rules and procedures for dealing with breaches of discipline and poor
performance in the workplace. However, without these they will find it
difficult, if faced with a claim for unfair dismissal, to satisfy an employment
tribunal that there was good reason for dismissing the employee in question,
that the reason was fair and that they acted reasonably in taking the decision
to dismiss.

Employers with 20 or more employees must, in the written
statement of terms and conditions of employment issued to each employee,
include the name or job title of a person in the organisation to whom the
employee can apply if dissatisfied with any disciplinary decision relating to
them. When the Employment Act 2002, Part 3 comes into force, a statutory
dismissal and disciplinary procedure will be implied into all employment

Which areas should be covered in a
company’s disciplinary rules?

When drawing up disciplinary rules, employers should aim to
specify clearly and precisely the rules necessary for the efficient and safe
performance of work and the maintenance of satisfactory relations within the
workplace. Typical rules will cover misconduct, substandard performance,
harassment or victimisation, misuse of company facilities, poor timekeeping and
unauthorised absence.

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