Dismissals, disciplinary proceedings and grievances: The new rules

On 1 October 2004, the provisions of the Employment Act 2002 which include dismissal and disciplinary procedures and grievance procedures will come into force. They are of considerable importance as they lay down minimum standards which all employers must follow to avoid a dismissal being automatically unfair.

The dismissal and disciplinary procedures apply to most dismissals, including those on the grounds of redundancy, conduct and non-renewal of a fixed-term contract.

In anticipation of the new procedures coming into force, employers should be revising their disciplinary and grievance procedures to ensure they are compliant and considering the appropriateness of training individuals who have responsibility for implementing them.

Disciplinary Procedures

Standard procedure
Schedule 2 (Part 1) of the Act sets out two types of procedure which may apply: a “standard procedure” and a shorter “modified procedure”. The standard procedure consists of the following:

  • a written statement from the employer setting out the grounds for action and inviting the employee to a meeting;
  • a meeting where certain requirements must be observed;
  • the employer’s decision and notification to the employee of the right of appeal; and
  • an appeal process.

The regulations* provide that the standard procedure applies where an employer “contemplates dismissing or taking relevant disciplinary action against an employee.” Relevant disciplinary action is defined as “action short of dismissal, which the employer asserts to be based wholly or mainly on the employee’s conduct or capability, other than suspension on full pay or the issuing of warnings.”

Modified procedure
The modified procedure consists of:

  • a written statement from the employer to the employee setting out the alleged misconduct which has led to the dismissal, what the basis was for thinking that the employee was guilty of the misconduct and notification of the right of appeal; and
  • an appeal process.

This applies in limited circumstances only. Conditions for its application include a dismissal without notice and it being reasonable for the employer to have dismissed the employee before enquiring into the circumstances in which the conduct took place. Given that non-compliance with applicable procedures will render a dismissal automatically unfair, employers should adopt the modified procedure only in unequivocally clear cases.

Regulation 4 sets out situations where the disciplinary and dismissal procedures do not apply. These include (amongst others) dismissals caused by unforeseen business closures, collective redundancies, collective dismissals aimed at effecting changes to employee terms and conditions and dismissals where the employee cannot continue working without contravening the law. Unless a situation clearly falls squarely within one of the listed categories, employers should follow the relevant procedure.

Grievance Procedures

Schedule 2 (Part 2) of the Act sets out the standard and modified grievance procedures. In basic terms, the constituent parts of the standard procedure are: the employee sends a written statement of the grievance to the employer, the employer invites the employee to a meeting to inform the employee of its response to the grievance followed by an appeal procedure. The modified procedure involves only a written statement from the employee followed by a response from the employer.

The regulations provide that the standard procedure will apply to any grievance about action by the employer that could form the basis of an employment tribunal claim (under a jurisdiction listed in the Act). The modified procedure applies where the employee has ceased to be employed, the employer was unaware of the grievance before the end of the employment or was aware but the standard procedure was not commenced or contemplated before the last day of the employee’s employment and the parties have agreed (after the employer became aware of the grievance) that the modified procedure should apply.

Contractual Term?

The government does not propose at this time to implement the provision of the Act which makes the dispute resolution procedures an implied term of all employment contracts. The intention is to conduct a survey in or around October 2006 to evaluate the impact of and compliance with the regulations and decide at that point. This is a sensible move as most employers will have enough to grapple with come October.

The full text of the Regulations can be found at The Employment Act 2002 (Dispute Resolution) Regulations 2004.

* Employment Act 2002 (Dispute Resolution) Regulations 2004

Bulletins are for general guidance only. Legal advice should be sought before taking action in relation to specific matters. Where reference is made to Court decisions facts referred to are those reported as found by the Court. Please note that past bulletins included in the Archive have not been updated by any subsequent changes in statute or case law.