The ACAS Code of Practice revisited

What is the scope of the ACAS Code?

The ACAS Code of practice on disciplinary and grievance procedures was most recently re-issued in 2015, though it was first published as long ago as 1977. On the disciplinary side it states that it covers both misconduct and poor performance, but does not extend to redundancy dismissals or the non-renewal of fixed-term contracts on their expiry.

Recent decisions from the Employment Appeal Tribunal have clarified that it does not apply to dismissals where there is no disciplinary element. So for example it does not apply to a dismissal on grounds of ill-health where the employee is not culpable, or to dismissals for “some other substantial reason” (for example a complete breakdown in workplace relations) where there is no disciplinary element. However its key principles may still be relevant.

What are its key principles?

The Code itself is very short, but its key principles are below:

• Deal with issues promptly: neither employers nor employees should unreasonably delay meetings, decisions or confirmation of those decisions. 
• Consistency: employers and employees should act consistently. 
• Investigations: employers should carry out any necessary investigations to establish the facts. 
• Putting the case: employees should be informed of the “problem” and be given the opportunity to put their case before any decision is made. 
• Being accompanied: employers should allow employees to be accompanied at any formal disciplinary meeting. 
• Appeals: employers should allow an appeal against any formal decision made.

What is the relevance of the Code in practice?

In broad terms employment tribunals are entitled to take into account any provision of the Code which “appears to be relevant”. That is what makes it a statutory code of practice. In essence this means that in misconduct and poor performance cases it is very likely that non-compliance with the Code will lead to a finding of unfair dismissal. In addition, since 2009, employment tribunals have had power to increase any unfair dismissal award by up to 25 per cent where in their view there has been “unreasonable failure” by the employer to comply with the Code.

Employers will not be open to such a sanction in other types of dismissal where there is no disciplinary element, but the broad principles of the Code may still be relevant when assessing whether a dismissal has been unfair. So for example in a recent case involving a breakdown of relationships at work, the lack of an opportunity for the employee to put her case led to a finding of unfair dismissal, even though the tribunal had now power to uplift the compensation for breach of the Code.

There are also situations where an employer would be well-advised to shadow the provisions of the Code, even though a failure to do so will not of itself result in a finding of unfair dismissal. For example in a redundancy situation, it is normally regarded as best practice to allow an employee selected for redundancy a right of appeal, though failure to do this will not necessarily mean the dismissal is unfair. However, adopting best practice may persuade to tribunal to overlook other procedural shortcomings when assessing the overall fairness of the process, particularly since a properly conducted appeal can “cure” defects in the original dismissal decision.

So in short, even in non-disciplinary dismissals, employers would do well to make sure the procedures they adopt reflect the general principles of the Code which are applicable to the factual situation. That is not so surprising, given the broad nature of the test for a fair dismissal, which imports a requirement for the employer not to act unreasonably when making the decision to dismiss. Sometimes there may be commercial reasons for acting differently, but employers should be aware that doing so may increase the risk of a finding of unfair dismissal.