The new ACAS Code of Practice - introduction
April 6, 2009
Anyone involved in HR or employment will know that as of today a new regime for the management of workplace disputes will be implemented in UK legislation. The Statutory Dispute Resolution Regulations which were introduced in October 2004 have been repealed and replaced with a new ACAS Code of Practice on Disciplinary and Grievance Procedures. The old procedures were introduced to try to reduce the amount of claims being made to employment tribunals; an aim which has spectacularly failed, with last year seeing an increase of more than 40% in claims on the year before. This week’s posts will look at all the different aspects of the new code of practice, how it differs from the old system of handling discipline and grievance, and what your company procedures should contain going forward.
Compliance
One of the main reasons that claims rocketed under the old system is the strict compliance to statutory and company procedures that was obligatory; the focus on procedural compliance has led to claims for unfair dismissal being won and lost on a procedural technicality, regardless of whether the dismissal was reasonable or fair; and this point is a key factor of the new system being implemented today. The new ACAS Code of Practice is not a legally binding document; it is not statutory and therefore does not hold the same legislative weight in a tribunal as the Statutory Dispute Resolution Regulations, so a failure to follow the code in handling a dismissal does not automatically mean the dismissal was unfair. However in saying this, tribunals will take the code into account when looking at how a dismissal or dispute was handled in the workplace; so organisations will have to be sure they follow the guidelines in the code, or have a strong justification for not following a particular aspect of it.
Compensation
Another change in the system relates to the relevant uplift or reduction in compensation awarded for failure to follow the recommended procedures. Under the old system, if a company or employee failed to follow the statutory procedures, the tribunal is obliged to uplift or reduce the compensatory award by between 10% and 50%. There is no discretion in this – the tribunal has to make the uplift or reduction for a procedural failure. In the new scheme, the tribunal can uplift or reduce the compensation if it feels there has been an unreasonable failure to follow the code of practice – but by no more than 25%. This part of the tribunal’s role is now discretionary; and means that even if a company fails to follow part of the code, the tribunal may feel that this wasn’t an unreasonable failure and may therefore not award any increase in compensation. This is most certainly one of the areas of the new system that will be tested and defined by case law
The next few articles will focus on disciplinary procedures under the new code of practice.
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