New Employee Rights - Making Dismissal More Difficult

Changes to the Employment Act in October 2004 relating to grievance and disciplinary matters will make the dismissing of staff more difficult. If members of staff have been employed for less than a year the new rules still apply.

The changes that have been brought in should prevent many cases going to employment tribunals; however small employers will probably feel the effects of the changes more than most.

Statutory minimum disciplinary and grievance procedures will now have to be incorporated into all employment contracts, and if an employer dismisses an employee without following the procedures could lead to tribunal compensation being increased by 50%.

The act has several main points, as follows:

• Staff must be informed in writing of the reasons for the disciplinary action, whether it is poor performance or some other alleged conduct, and must be invited to a disciplinary meeting to discuss the matter. Apart from suspension, no other action must be taken against the employee until the meeting is held.
• The employee must be informed of the basis of the allegation and given a reasonable amount of time to consider it.
• The employee must be informed of the outcome of the meeting and made aware of their right to appeal. An appeal meeting must be held and, once again, the employee must be advised of the outcome.
• If an employee is dismissed, a minimum statutory procedure must be followed. Details of this have not yet been finalised, however with the exception of gross misconduct, it will most likely be at least a first and final warning prior to dismissal.

The changes will mean that an employer will no longer be able to simply dismiss an employee with less than a year’s service without worrying about the outcome, plus the possibility of a tribunal increasing compensation by up to 50% when procedures have not been followed, represents a major change in employment law.

Likewise, the changes in grievance procedures, will hopefully lead to less tribunal cases, should result in more cases resolved internally.

At present, formal disciplinary and grievance procedures are necessary where an employer has more than 20 employees, this will no longer be the case, the procedures will need to be followed irrespective of how small your workforce is.

The procedures must be in written form, contained in a contract or a separate policy, failure to issue at least a statement of written particulars can result in penalties.

Our advice is to implement a full disciplinary and grievance policy and procedure before October 2004, and to make all staff aware of it. Also, you must ensure that you give all staff written particulars of employment; a full contract of employment is preferable.

Taken with permission from an article in biiBUSINESS, the Business Journal of the British Institute of Innkeepers – issue 23 February 2004.