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Dispute resolution and the Employment Act 2008

01 December 2008

In October 2004, statutory dispute resolution procedures (“the statutory procedures”) were introduced for the handling of dismissal, discipline and grievances for employees’ in the workplace.

By elevating procedure over substance, the much maligned statutory procedures have generally hindered rather than helped the cause of workplace resolution. They have had significant unintended negative consequences that outweigh the benefits. In particular, the formalisation of disputes at an early stage, which has led to an increased number of claims at the Employment Tribunal (“ET”), increased costs, time and confusion.

The statutory procedures are to be repealed in April 2009 following the implementation of the Employment Act 2008. In their place will be a revised Acas Code of Practice on Disciplinary and Grievance Procedures (“the Acas Code”). The Acas Code is short, concise and principles based; it will be supplemented by a longer free standing non statutory guidance document.

The Acas Code will not apply to redundancy situations or the non renewal of fixed term contracts on their expiry. ET’s will be given the power to uplift or reduce awards by up to 25% (currently a duty to award 10% and up to 50%) when there has been an unreasonable failure by either the employer or the employee to comply with the Acas Code. The use of independent third parties, including external mediators, to resolve disputes is encouraged.

It is hoped that the changes will remove some of the cumbersome requirements of the current statutory procedures. The failure to follow the revised Acas Code will no longer automatically render a dismissal unfair. Section 98A of the Employment Rights Act 1996 will be repealed: this means reverting back to reliance on the pre 2004 line of cases that followed Polkey v AE Dayton Services Ltd (1987). There will no longer be modified procedures or a requirement for an employee to raise a grievance in writing if they want to bring a subsequent ET claim.

The success of the proposed changes will be judged in time. However, tentatively the changes appear a small step in the right direction and should be cautiously welcomed.

For more information contact Andrew Masters.

 

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