Legal Q & A: Statutory grievance procedures

By Mike Huss, senior employment law specialist at Peninsula

Q What are the Statutory Grievance Procedures?

A They are procedures that must be provided by employers and followed
by employees when raising a grievance. They are part of the Statutory Disputes
Resolution Procedures (SDRP), which must be adhered to by employers when taking
disciplinary action against an employee. Both come into effect in October 2004,
and are linked to the Employment Act 2002.

Q What will the introduction of these procedures mean for employers and
their staff?

A The main impact will be seen in two areas; more comprehensive contracts
of employment will have to be produced and issued, and there will also be, for
the first time, direct penalties for failing to issue contracts. When a case
reaches tribunal, if an employer cannot prove that the SDRPs have been
followed, pay awards could increase by up to 50 per cent. There are therefore
substantial financial penalties if the proper procedures have not been
followed. These are in addition, of course, to the costs that an employer will
incur just by having to go to tribunal.

Having seen the Government’s consultation paper on the SDRP, and having met
with its representatives and commented vociferously regarding it, we can
categorically state that the procedures are inadequate. The mechanics are the
problem. The SDRP is less than minimal, even regarding conduct issues, and is
completely irrelevant regarding capability, redundancy, a statutory prohibition
or some other substantial reason.

We are still in correspondence with the DTI, and are seeking to persuade it
of the errors inherent in the proposals.

Q Why are these procedures being introduced?

A The Government wants to facilitate a reduction in the number of
unfair dismissal claims brought each year – currently there are in excess of
100,000 annually. About 70 per cent of claims are withdrawn and/or settled out
of tribunal. The remaining 30 per cent of claims proceed to a tribunal hearing.

The cost of these 30,000-plus hearings to the Government is huge, and it
wants to limit the number of disputes that make it to tribunal by encouraging
both parties to settle their differences before things get that far.

Q What will the main problems be for employers?

A Employers need to be extremely careful when it comes to the
procedures they follow. Those set out in the Government’s consultation paper
are not as thorough as those recommended in the latest Acas code, and as they
stand at present, employers should not think that if they follow the
Government’s guidelines they will be successful if their case reaches tribunal.
We predict that the majority of employers who just follow the Government’s
guidelines as currently proposed would be found to have acted unfairly when
they reach tribunal.

In a way, the introduction of this legislation is going to give employers a
false sense of security, and our recommendation would be to regard it as simply
‘step 1’ of the procedure. It is also going to make the whole process even more
complex, as there will be a huge amount of confusion over which procedures
should be followed. The recommended SDRP just do not fit the needs of employers
or employees – they simply do not address the issues, clearly established as
essential over many years by case law.

As for the issue of dismissing someone who is, say, disabled, they are so
bad that they provide an open chequebook for any such applicants. The idea of
trying to save taxpayers’ money by early, and therefore cheaper, dispute
resolution is an excellent one – the problem is that this will not do it.

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