For many employees, job security seems like a thing of the past. Staff may be demoralised or fearful of their own jobs. They may be frustrated about pay freezes or scrapped bonuses. They may also feel upset that certain colleagues have left while being put under pressure to accept wage cuts and reductions in hours. A drop in headcount will often also leave remaining staff with more work and responsibility.

 

Employees will react in a number of different ways. While many will successfully accommodate their new working environment, employers may face increased grievances or incidents resulting in the need for disciplinary action. Employers must ensure they deal correctly with both, otherwise the consequences for the business could be costly from a legal standpoint and damage staff morale. 

 

 

The statutory disciplinary and dismissal procedures introduced in 2004 were designed to give employers a clear idea of how to conduct disciplinary and grievance procedures fairly. Failure to do so led to a finding of automatic unfair dismissal in the Employment Tribunal, and a potential increase in employee compensation of up to 50%.

 

Although these procedures had the merit of being a clear set of steps for employers to follow, many businesses were tripped up by a minor technical blip of missing one of the steps, or not sufficiently complying with an intervening requirement. In April of this year, the statutory procedures were replaced by a Code of Practice (‘Code’) issued by ACAS, the conciliatory body. That does not mean that all the procedures go out of the window, but at least it means there is no longer automatic unfair dismissal for missing a step. While failure to follow statutory procedures could have resulted in an uplift of up to 50%, now failure to follow the Code could result in an increase in compensation of up to 25%.

 

Employers may be wary of disciplining staff, especially if employees are being asked to make sacrifices. Nevertheless, performance issues, insubordination and absenteeism could seriously undermine efforts to cut costs and adapt to a challenging economic environment and should not be tolerated. Exceptions made for some staff could spread throughout an organisation and drive down standards in work and behaviour across the board. Furthermore, it could affect morale of those staff trying to make an effort in difficult circumstances.

 

When addressing conduct issues, employers should ensure that their own disciplinary policies comply with the Code. The Code requires that employees be notified in writing of the alleged misconduct and its possible consequences. Any written evidence collected by the employer should also be provided. Employers must address employees’ evidence at the beginning of the meeting, including witnesses. A right of appeal should be provided by the employer, and any appeal should be dealt with by someone not previously involved, where possible.

 

Warnings (including verbal warnings, if a record is retained) should be dealt with formally, with a hearing and right of appeal. Verbal warnings can be used as an informal management tool provided they do not form part of the disciplinary record.

 

 

Grievances are also a risk. Although they may be about valid issues, such as increased strain on employees due to workloads or bullying, grievances can also be used by employees to take a shot at management following an unpopular decision or to slow down an ongoing disciplinary matter. Employers should first recognise a grievance: it can be any concern, problem or complaint that an employee raises with the employer. If in doubt, assume it is a grievance or check with the employee concerned. If a grievance cannot be resolved informally, the employee may write to a manager setting out the issue.

 

The employer should then follow the Code by holding a meeting to allow the employee to explain their grievance and how they think it should be resolved. The employee is entitled to be accompanied, either by a colleague or union representative. If the matter needs further investigation, the employer should adjourn the meeting and resume it after the investigation has taken place. When the meeting concludes, the employer should write to the employee with its decision, including details of any action it intends to take to resolve the grievance. Employees have a right of appeal of any decision, which should be dealt with impartially by the employer.

 

Previously, employees were prevented from taking a matter to an Employment Tribunal if they had not raised it in a grievance with their employer. That requirement is now gone and therefore a useful early warning mechanism for employers has been removed. Whether or not tribunals will reduce compensation to employees if they consider that the matter could have been dealt with earlier if a grievance had been brought is currently unclear.

 

Employers should be realistic when dealing with staff under stress and who feel under threat. However, a lenient attitude to disciplinary policies or a careless approach to dealing with grievances will further jeopardise a business in the aftermath of redundancies. When used correctly, businesses find that the effective application of disciplinary and grievance policies can improve workplace conditions and productivity. Problems are spotted early and addressed so that employees can feel supported and involved in management processes. This management tool can assist in putting businesses back on their feet again.