The complexities and legal issues that are thrown up by the new statutory
dispute resolution procedures are likely to cause more costs for employers
instead of less
The new statutory dispute resolution rules come into force on 1 October, and
are likely to bring practical and legal chaos.
Arguably, the real purpose of these new procedures is to cut the workload of
tribunals and save money. Yet, it is more likely that employers will see their
costs spiral as a result of the new rules, because of the complexities and
legal arguments they will throw up. They include:
The ‘starting’ of a procedure
In normal circumstances, an employee must have started the relevant
statutory grievance procedure if they bring a tribunal claim (which is not
based on their dismissal) against their employer, or they will be barred from
bringing a claim. They must also submit a written grievance. But, given the
state of the postal system, and frequent difficulties with e-mail delivery,
there is huge potential for arguments over whether or not a grievance letter
has been submitted by an employee at all, or has effectively been made.
Furthermore, if a case goes to tribunal, which decides that a procedure has
started that an employer disagrees with, or has argued they have not had proper
notice of, the employer could be vulnerable to paying an increase of 10 to 50
per cent more in compensation award. In discrimination cases, for example, this
could prove very costly indeed.
The new laws also mean both sides can be excused from even starting (or
continuing) a grievance procedure if there are ‘reasonable grounds to believe’
it would result in ‘a significant threat to himself, his property, any other
person or the property of any other person’.
Completion of the procedure
In a normal dismissal scenario, where an employee has more than a year’s
service, their dismissal will automatically be deemed unfair unless the
procedure under the new rules has been ‘completed’, or the failure to complete
is ‘wholly or mainly attributable’ to their employer’s failure. There will be
legal wrangling over whether or not the dismissal procedure was properly
‘completed’ or not.
The rules include complicated procedural ones on non-attendance at meetings
(which may be excused if reasons ‘not foreseeable when the meeting was
arranged’ arise, but make it ‘not reasonably practicable’ to attend).
Once two meetings have been called, and the employee has failed to attend,
the duty on the employer to continue to hold a meeting will cease. Lawyers will
be keen to argue whether or not ceasing to try to hold a meeting itself
constitutes non-completion of the procedure. It gets worse; if either party is
in breach of the relevant procedure, both will then have no obligations to
comply with any further part of it. Automatic unfair dismissal or a cut in compensation
award could become the new battleground.
All action under the new rules must be ‘taken without unreasonable delay’.
The timing and location of meetings must be ‘reasonable’, and must allow both
sides ‘to explain their cases’.
All these rather nebulous concepts can mean the difference between
completion or non-completion of the new legal procedure, giving rise to yet
more legal rows. The tribunal will have to adjudicate on the facts.
These arguments will be fought primarily with witness evidence, which can be
a slow and cumbersome process.
The potential for litigation has risen as a result of these new rules.
Lawyers should be forgiven for licking their lips.
By Russell Brimelow, Partner, Lewis Silkin