Dismissal and Grievance Procedures - Framing and Operating Procedures To Meet Current Rules (Thorogood Reports) PDF

THOROGOOD
PROFESSIONAL
INSIGHTS
A SPECIALLY COMMISSIONED REPORT
DISMISSAL AND GRIEVANCE

PROCEDURES
FRAMING AND OPERATING PROCEDURES
TO MEET CURRENT RULES
Dennis Hunt
IFC
THOROGOOD
PROFESSIONAL
INSIGHTS
A SPECIALLY COMMISSIONED REPORT
DISMISSAL AND
GRIEVANCE PROCEDURES
FRAMING AND OPERATING PROCEDURES
TO MEET CURRENT RULES
Dennis D Hunt
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Audrey Williams
© Dennis D Hunt 2005

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The author
Dennis Hunt began working in industrial relations and employment law in the
motor industry in the 1970’s. During this time he was heavily involved in trade
union negotiations and strike resolution. His experiences during this time lead
him to write his first two books, Common Sense Industrial Relations in 1976 and
Employment and Dismissal Without Fear in 1978. Both books were published
by David and Charles.
In 1977 Dennis launched his first business IRPC (Industrial Relations and Personnel
Consultants). This business concentrated on providing employment law and
practical personnel advice and assistance to the smaller business. The business
ultimately grew to advise over 500 small businesses throughout the United
Kingdom and employed over 200 employees. The business is now a part of Croner
Consulting Ltd. In 1980 Dennis was awarded the Coventry City Chamber of
Commerce Young Business of the year award.
In 1991 Dennis launched Dennis Hunt Risk Management Services Ltd a

business which concentrated on handling volume employment tribunals as well
as providing advice and assistance to businesses of all sizes on employment law
and related personnel problems. By 1997 and beyond, this business was handling
up to 350 employment tribunals at any one time. This business, which was
renamed SBJ Risk Management, was sold to the Croner Group in 2000 and now
forms part of Croner Consulting Ltd.
Working with Thorogood Publishing Dennis wrote Successfully Defending

Employment Tribunals in 2002. The latest updated version of this report was
released in April 2005.
Dennis continues to work as a seminar leader and employment law consultant

handling employment tribunals and related issues for his clients.
THOROGOOD PROFESSIONAL INSIGHTS iii

Contents
Introduction..................................................................................................1
1 THE LEGISLATION 4
A brief history of unfair dismissal legislation and
employment tribunals .................................................................................5
Summary of changes introduced by the Employment Act 2002 ............7
The standard three step disciplinary disputes procedure.......................8
The modified disciplinary procedure.........................................................8
Default judgments........................................................................................9
Case management .......................................................................................9
ACAS conciliation .....................................................................................10
Directions hearings ...................................................................................10
Costs............................................................................................................11
2 CONTRACTS OF EMPLOYMENT 13
Contracts of employment: an introduction.............................................14
The tests of employment ..........................................................................15
Forming the contract ................................................................................17
Formalities..................................................................................................19
Contracts: the four elements ....................................................................19
The Employment Rights Act S1 –
’written statement of particulars’ ............................................................22
Changing the terms of a contract of employment ................................23
Summary.....................................................................................................24
3 DISCIPLINARY RULES 25
Disciplinary rules: an introduction ..........................................................26
Drafting the rules.......................................................................................27
Health and safety rules..............................................................................29
Communicating the disciplinary rules ....................................................30
THOROGOOD PROFESSIONAL INSIGHTS iv

CONTENTS
4 DISCIPLINARY PROCEDURES 32
Disciplinary procedures and the law.......................................................33
Modified disciplinary procedures and gross misconduct.....................35
The ACAS guide to disciplinary procedures ..........................................37
Special situations ......................................................................................39
Summary ....................................................................................................40
5 DISCIPLINARY PROCEDURES STEP-BY-STEP 43

Investigation...............................................................................................44
Informal disciplinary action......................................................................47
Formal disciplinary action ........................................................................47
Invitations to a meeting.............................................................................48
Provision of evidence ................................................................................49
The right to be accompanied....................................................................50
The disciplinary meeting...........................................................................51
Handling disciplinary meetings ...............................................................53
Records of disciplinary meetings.............................................................56
6 DISCIPLINARY SANCTIONS 57
Disciplinary sanctions and warnings ......................................................58
Poor performance issues – capability......................................................60
Sickness, lateness and absence ................................................................60
Misconduct and gross misconduct ..........................................................63
7 ENDING EMPLOYMENT 66
How employment can end ........................................................................67
Resignation.................................................................................................67
Termination by mutual agreement...........................................................69
Compromise agreements..........................................................................70
Requirements of a compromise agreement............................................71
Independence of adviser...........................................................................72
The conclusion of a fixed term contract..................................................73
THOROGOOD PROFESSIONAL INSIGHTS v

CONTENTS
Dismissals with notice and summary dismissals ...................................73

Capability dismissals ................................................................................78
Skill and aptitude .......................................................................................78
Ill health dismissals....................................................................................79
Qualification dismissals.............................................................................81
Conduct dismissals ....................................................................................82
Redundancy dismissals ............................................................................83
8 GRIEVANCES 94
Grievances: an introduction .....................................................................95
The standard ‘three step’ grievance procedure ....................................96
Definition of a grievance...........................................................................97
The ‘modified’ two step grievance procedure ........................................98
Overlapping disputes ..............................................................................101
Grievance procedures and their impact on employment tribunal
applications ..............................................................................................102
9 APPEALS 104
The right of appeal ..................................................................................105
APPENDICES 109
Appendix I Example of disciplinary rules and procedure...............110
Appendix II Example of a grievance procedure ................................116
Appendix III Example of a complaints procedure dealing
with harassment or bullying...........................................119
THOROGOOD PROFESSIONAL INSIGHTS vi

Introduction
This report looks at the all important requirements for businesses of all sizes to
operate effective dismissal, disciplinary and grievance procedures which meet
the requirements of the law. In particular, the report covers all of the require-
ments of the new ‘Disputes Resolution Procedures’ that came into effect 1st
October 2004. These new rules changed the law on unfair dismissal substan-
tially, by ensuring that no major decisions can be fairly taken when disciplining
an employee, or dealing with any grievance that they may have without certain
basic procedural steps having been followed. The new rules also impact on the
admissibility of tribunal claims by reference to these same procedural steps.
The volume of claims being brought before employment tribunals throughout

the 1990s brought pressure on the government to take steps to reduce what was
considered to be an unusually high figure. Statistics from the Employment
Tribunals Service show that there was a 300% rise in employment tribunal appli-
cations over the ten years 1990 to 2000. There were just 43,243 applications in
1990. This had grown to 103,935 by 1999, peaking at over 130,408 in the 12 months
to March 2001, and settling slightly to 112,227 in the year to 31st March 2002;
66% of all cases disposed of in this year were withdrawn, or settled before a
full hearing, compared with 77% the previous year.
One amazing statistic identified by the Employment Tribunals Task Force set
up in October 2001, charged with reviewing the existing tribunal system, showed
that 64% of the applications to employment tribunals were lodged without the
employee and employer having first met to discuss the problem and attempting
to resolve it between themselves.
In 2001 the government estimated the average cost of defending a claim at around
£2,000, and the cost of replacing a member of staff in excess of £3,000 – and
these figures do not include management costs associated with defending a claim,
and the possible damage to workplace relations that may have arisen. Fewer
than 50% of claimants claim unfair dismissal, the bulk of the remainder is made
up of claims of discrimination, improper pay deductions and other breach of
contract claims.
Employment Tribunals were originally intended to provide fast, non-legalistic,

settlements of disputes between employers and employees. However, over the
years, they have become increasingly legalistic, sometimes with little more than
a thin veneer of informality. This was probably inevitable given that the rules
THOROGOOD PROFESSIONAL INSIGHTS 1

INTRODUCTION
stipulate that the chairman must always be an experienced lawyer whose training
and background hardly encourages informality when dealing with disputes.
In 2001 the government published a consultation document entitled Routes to

resolution: improving dispute resolution in Britain, in which it expressed the view
that the number of claims could be reduced through better handling of
disputes in the workplace and a greater focus on conciliation as opposed to litiga-
tion. The government believed that employers with access to effective written
procedures, were more likely to resolve disputes, or have applications to tribunal
made against them withdrawn, than employers without such procedures. Small
businesses were of particular concern (defined as those with fewer than 250
employees) for these account for a disproportionately high number of employ-
ment tribunal applications. Although such businesses employ only 18% of the
workforce, they feature in 29% of the claims made.
Following on from the initial consultation process, the government introduced

a Bill into parliament in the 20001/2 session. This Bill eventually became the
Employment Act 2002. This new Act places clear obligations on employers to
operate and follow prescribed procedures, set out within the Act, when dealing
with disciplinary and dismissal matters, and when handling employee griev-
ances, and on employees to use these same procedures where appropriate. This
report includes within it details of all of the steps employers must take to comply
with each of the requirements of the Employment Act 2002, and covers all matters
relating to disciplinary, dismissal and grievance procedures at the workplace.
Where the new statutory dismissal and disciplinary rules apply, employers will
be expected to follow defined steps whenever disciplinary or dismissal action
is being contemplated, or when dealing with any grievances raised formally by
their employees. The definition of ‘dismissal’ is much wider than hitherto, and
includes redundancy, expiry of fixed term contracts and capability dismissals.
The employee is expected to cooperate with the operation of these procedures,
and is also required to follow certain defined steps themselves, before presenting
a claim to an Employment Tribunal. A failure to follow, and comply with the
procedures, when a dismissal takes place, will result in any subsequent
dismissal being ruled automatically unfair.
Similarly, where the new statutory grievance procedures apply, the employee
will first be required to put any grievance to their employer, and the employer
will be expected to invite the employee to a meeting to discuss the grievance,
and provide for an appeal against any resultant decision. A failure by an employee
to follow the prescribed procedure will, in most circumstance, bar them from
bringing a tribunal claim relating to the grievance.

INTRODUCTION
Compensation for any successful tribunal claim, in relation to which one of the
new statutory procedures applies, can be reduced, or increased by between 10
and 50%, to reflect any failure on the part of the employer, or employee, to comply
with any aspect of the new statutory procedures.
Through the operation of the new regulations, the government hope and expect
that the number of applications to Employment Tribunal will fall substantially,
leading to reduced pressure on the system and, as a result, an improvement in
the efficiency and effectiveness of the service in general. Only time will tell if
this laudable aim will be realized.
Dennis Hunt
2005

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 1
The Legislation
A brief history of unfair dismissal legislation
and employment tribunals....................................................................5
Summary of changes introduced by the Employment Act 2002......7
The standard three step disciplinary disputes procedure.................8
The modified disciplinary procedure ..................................................8
Default judgments .................................................................................9
Case management .................................................................................9
ACAS conciliation ...............................................................................10
Directions hearings .............................................................................10
Costs......................................................................................................11
Chapter 1
The Legislation
A brief history of unfair dismissal legislation

and employment tribunals
‘Unfair dismissal’ is a statutory creation (unlike wrongful dismissal). It came into
English law with the Industrial Relations Act 1971. Thus the right ‘not to be unfairly
dismissed’ only exists if statutory conditions are satisfied.
In 1978 unfair dismissal law was consolidated with the 1963 Contracts of Employ-
ment Act and the 1965 Redundancy Payments Act into the comprehensive
Employment Protection (Consolidation) Act 1978 which was itself repealed and
replaced with effect from 22nd August 1996 by the 1996 Consolidation Acts.
Until 1971 the only modern UK statutes dealing with individual employment rights
were the 1963 Contracts of Employment Act (which gave employees the right
to written particulars of terms and conditions of employment) and the 1965 Redun-
dancy Payments Act.
Employment Tribunals (formerly called Industrial Tribunals) were established

under Section 12 of the Industrial Training Act 1964 and the rules governing
the constitution of such tribunals were set out in the regulations made under
that Act.
At the time of their creation Industrial Tribunals handled disputes under the Indus-
trial Training Act. In 1965 their jurisdiction was extended to include disputes
that arose from the Redundancy Payments Act 1965 and, following the Indus-
trial Relations Act 1971, to unfair dismissal claims. Since then the jurisdiction
of Employment Tribunals has been progressively extended to cover a wide range
of employment related issues. Today Employment Tribunals have jurisdiction
to hear claims under a large number of statutory provisions. These currently
total over 80.
In 1964 the UK government had accepted the recommendations of the Inter-

national Labour organization on the subject of Termination of Employment. In
1965 it set up an employment/industrial relations commission under Lord
Donovan to examine industrial relations policy generally. The Donovan Commis-

1 T H E L E G I S L AT I O N
sion reported in 1968 and amongst more general recommendations was one
for a law of unfair dismissal.
Barbara Castle, the Minister responsible in the Wilson government for employ-
ment matters, produced a paper (In place of strife) proposing legislation based
on the Donovan report. The unions would not accept this and at the 1970 general
election the Labour government was defeated.
One of the first acts of the incoming Conservative government under Edward
Heath was to pass the Industrial Relations Act 1971. This was mainly concerned
with general industrial relations matters, derived from the 1968 Conservative
Party document, Fair deal at work, but also introduced unfair dismissal along
the lines recommended by the Donovan Commission.
The unions would not accept the Industrial Relations Act 1971, however, they
were generally in favour of the unfair dismissal sections of the Act. The matter
came to a head with the 1974 miners’ strike when Edward Heath called a general
election and lost.
The new (1974) Labour government repealed the Industrial Relations Act (IRA)
in its entirety by introducing the Trade Union and Labour Relations Act 1974.
However, they re-enacted the unfair dismissal elements of the IRA 1971, with
a few minor amendments.
In 1978 unfair dismissal law was consolidated with the 1963 Contracts of Employ-
ment Act and the 1965 Redundancy Payments Act into the comprehensive
Employment Protection (Consolidation) Act 1978 which was itself repealed and
replaced by the 1996 Consolidation Act.
The Labour government fell in 1979 after the ‘winter of discontent’ in which indus-
trial action spilled over from the workplace and became too violent for the public
to accept.
The next (Conservative) government, under Mrs Thatcher, made many changes
to labour and industrial relations law generally but left the law of unfair dismissal
pretty well alone, to be developed by the tribunals and the courts.
The Employment Act 2002 was introduced by the Labour government to bring
statutory dispute resolution procedures into being that must be followed by both
employer and employee alike, in order to reduce the high volume of cases coming
before the Employment Tribunals

Summary of changes introduced by the

Employment Act 2002
Employment Tribunals commence with the submission of an Originating
Application – the ET1. In this document the claimant is required to state precisely
what it is that they are claiming. The Employment Act 2002 radically increased
the amount of information sought from the ET1. The form increased consider-
ably in size to eight pages and 11 sections. It is now a formidable document indeed.
It is accompanied by a five page closely worded guidance sheet which includes
the recommendation that the claimant seek advice on completing the form. The
intention behind this change is to ensure that sufficient information is available
to the Employment Tribunal’s administration staff, to enable them to check that
both the claimant and respondent have met the new requirements placed on
them by the new Disputes Regulations Procedures that came into force on 1st
October 2004.
The Employment Act 2002 contained provisions preventing certain categories

of complaint from being presented to a tribunal until they have been dealt with
by the use of the employer’s Grievance Procedure. Where this has not
happened, the case can be remitted back to the employee or ex-employee to
enable the steps of the Statutory Grievance Procedure to be followed with at
least 28 days elapsing thereafter. The time deadlines which surround any claim
to the ET will be extended to allow these steps to be followed.
‘Fair’ includes the fact that a Disputes Procedure was followed that met the specific
‘Standard’ (three-step) or ‘Modified’ requirements of the Disputes Resolution
Regulations. Where the requisite Disputes Procedure has not been followed,
or worse, no Disputes Procedure exists, or is inadequate, the respondent risks
automatically losing the case with the award of compensation being made against
them being increased by between 10% and 50%.

The standard three step disciplinary

disputes procedure
The standard three step procedure referred to above requires the following:
1. The employer sets down in writing the nature of the employee’s conduct,
capability or other circumstances that may result in dismissal, or other
disciplinary action, and sends a copy of this statement to the employee.
The employer must inform the employee of the basis for his/her
complaint.
2. The employer must invite the employee to a hearing at a reasonable

time and place where the issue can be discussed. The employee must
take all reasonable steps to attend. After the meeting, the employer
must inform the employee about any decision, and offer the employee
the right of appeal.
3. If the employee wishes to appeal, he/she must inform the employer.

The employer must invite the employee to attend a further hearing to
appeal against the employer’s decision, and the final decision must be
communicated to the employee. Where possible a more senior
manager should attend the appeal hearing.
Note: Employees are entitled to be accompanied at any formal stage of the proce-
dure by a companion or trade union representative of their choice.
The modified disciplinary procedure

The modified procedure requires the employer to do the following:
1. Set down in writing the nature of the alleged misconduct that has led
to the dismissal, the evidence for this decision, and the right to appeal
against the decision, and send a copy of this to the employee.
2. If the employee wishes to appeal, he/she must inform the employer.

The employer must invite the employee to attend a hearing to appeal
against the employer’s decision, and the final decision must be
communicated to the employee. The employee may be accompanied
at any appeal hearing by a representative or trade union official of their
choice.

The modified procedure may be used only when the following conditions apply:
• Where the employer dismissed the employee without notice on the

basis of his or her conduct.
• The dismissal took place at the time the employer became aware of
the gross misconduct (or immediately thereafter).
• The employer was entitled to dismiss for gross misconduct without

notice or payment in lieu of notice.
• It was reasonable for the employer to dismiss without investigating

the circumstances.
Default judgments
The revised Employment Tribunal Constitution and Rules of Procedure 2004 intro-
duced a new system of default judgments under which a tribunal chairman may,
in certain circumstances, determine a case without a hearing if he or she considers
it appropriate to do so. Such a judgment may decide liability alone, or liability
and remedy.
As a result of this change a chairman may issue a default judgement where a

respondent has failed to submit a response within the prescribed time limit, or
the respondent has submitted a response which failed to meet the pre-accept-
ance conditions.
Case management
The powers of case management given to chairmen under the new rules of proce-
dure are considerable. These powers are an integral part of the intention to speed
up proceedings wherever possible.
Chairmen now have the power to hold ‘case management discussions.’ Such
discussions are interim hearings intended to deal with matters of procedure and
management of the proceedings. They can be held by a chairman on his or her
own, with the claimant and the respondent invited to take part. They may be
held over the telephone or in person. If either party fails to carry out or comply
with any order that results from any such discussion, their claim or response
may be struck out and they can become liable to pay some, or all of the other
party’s costs.

The new rules provide that notwithstanding the ‘preliminary or interim’ nature
of a PHR, a case may be struck out at this stage where in the chairman’s view
a claim or response is scandalous, vexatious, or has no real prospect of success;
or where the conduct of the case has been scandalous, unreasonable or vexatious.
ACAS conciliation
The Employment Tribunals (Constitution and Rules of Procedure) Regulations
2004 which came into force of 1st October 2004 radically changed the rules
governing the period of time during which ACAS managed conciliation, can
take place. Previously ACAS conciliation was open-ended in time. The new rules
introduced fixed defined periods for conciliation, during these periods of concil-
iation, no hearing date will be set, or notified to the parties. Once these periods
have elapsed ACAS will not become involved further, as their ‘duty’ to concil-
iate will have been fulfilled. They will still have the ‘power’ to conciliate, but are
expected to exercise this power with considerable restraint.
Short conciliation periods of seven weeks, starting with the date the claim is
sent to the respondents, will apply to breach of contracts claims and other claims
brought under the Employment Rights Act 1996 – including unlawful deduc-
tions from wages, right to guarantee payments, right to time off for public duties
and a failure to pay any due redundancy pay. This, together with a variety of
claims brought under the Trades Union and Labour Relations (Consolidation)
Act 1992, and claims under the Transfer of Undertakings (Protection of Employ-
ment) Regulations (TUPE), regarding a failure to pay compensation, following
a failure to consult as required by the TUPE Regulations.
A ‘standard conciliation period’ of 13 weeks will apply to all other claims.
Directions hearings
As a result of the Employment Act 2002, directions hearings will become an
increasing feature of the Employment Tribunal case management process. A
tribunal may at any time, on the application of a party, or of its own motion,
give such directions on any matter arising in connection with the proceedings
as it believes appropriate.
Directions may include any requirement relating to evidence, including the provi-
sion and exchange of witness statements, the provision of further particulars,

and the provision of written answers to questions put to either party by the
tribunal. The tribunal may also, on the application of a party or on its own motion,
require the attendance of any person, either to give evidence, or to produce
documents, or both and may determine both the time and place at which the
person is required to attend. A failure to comply without reasonable excuse shall
lead on summary conviction to a fine. The tribunal also has the power to make
an order in respect of costs, and to strike out the whole or part of the originating
application, or the notice of appearance and, where appropriate, direct that a
respondent be debarred from defending the case altogether.
Costs
One major change introduced by the Employment Protection Act 2002 relates
to the power of tribunals to make costs orders. This increased power provides
additional ‘bite’ to a tribunal’s powers, and is intended to force the parties to
ensure that they comply with all tribunal’s orders, and do all in their power to
ensure that delays and adjournments are kept to a minimum, thus eliminating
unnecessary delays to tribunal proceedings.
The new powers enable tribunals to make costs awards of up to £10,000 where,
in the tribunal’s opinion, a party has behaved vexatiously, abusively, disruptively
or otherwise unreasonably in bringing or conducting the proceedings, or the
tribunal find that the bringing or conducting of the proceedings by a party has
been misconceived. In such circumstances the tribunal may make an award of
costs against the party. Such an award can include the costs of preparation time
in preparing for the hearing, for non legally represented parties, and ‘wasted’
costs.
‘Wasted’ costs are costs incurred by a party, such as travel or overnight stay
expenses, that have been incurred by them – but which may be wasted – as a
result of the conduct of the other party.
Preparation time orders may be made in favour of unrepresented litigants. Prepa-

ration time does not include any time spent at hearings. However, it does include
any preparation work done which is directly related to the proceedings, and
also any time spent by that party’s advisers or employees directly relating to
the conduct of the proceedings.
Whilst the maximum costs that can be awarded by a tribunal is £10,000, this
need not necessarily be the maximum that results. The tribunal rules set out three
ways in which a costs order against a party can be made. Firstly, the tribunal

may specify the sums payable, where that sum is no greater than £10,000.
Secondly, the parties may agree the sum payable between themselves. Thirdly,
the tribunal may order the costs to be determined by way of a detailed assess-
ment in a County Court. The rules make it clear that if the amount is set using
the two latter methods, the amount may well exceed the £10,000 maximum.

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 2
Contracts of employment
Contracts of employment: an introduction.......................................14
The tests of employment ....................................................................15
Forming the contract ..........................................................................17
Formalities............................................................................................19
Contracts: the four elements ..............................................................19
The Employment Rights Act S1 –

’written statement of particulars’ ......................................................22
Changing the terms of a contract of employment ..........................23
Summary ..............................................................................................24
Chapter 2
Contracts of employment
Contracts of employment: an introduction

Any report on disciplinary rules, procedures and grievance procedures must
include a section dealing with the contract of employment for this is the ‘corner-
stone’ of all employment relationships. All flows from it and it is to the contract
we must return whenever we are dealing with breaches of contract, or any other
employer/employee dispute, whether they be caused by the employer or the
employee.
The ERA 1998 Section (s)230 states that an employee is ’…an individual who has
entered into, or works under, a contract of employment…’
So what is a contract of employment? Put at its simplest, it is an agreement

between two parties that has value; where an intention to be bound in a legal
relationship has been expressed verbally, or is evidenced by the actions of the
parties.
Often employers and employees alike will state that they have either not issued,
or not received a contract of employment. What they really means is that they
have not issued the Statement of Terms and Particulars required under Section
1 of the Employment Act 1996.
Anyone working for payment is operating under either a ‘contract of employ-

ment’, or a ‘contract to provide services’. The former being a traditional contract
of employment, the latter being a self-employed contract. The fact that a worker
chooses, or is required to pay for their own income tax and National Insurance
is not, contrary to popular belief, a defining measure of the legal nature of the
employment. The rules that determine employment differ markedly between the
Inland Revenue and the civil courts.
An employer can be a:
• Sole trader
• Partnership
• Company

2 CONTRACTS OF EMPLOYMENT
• Unincorporated association
• Private individual.
Employers can employ:
• Permanent staff
• Part-time staff
• Casual employees
• Highly skilled short-term employees
• Fixed-term employees – whose employment ends on a specific date

or in response to the completion of a specific task.
The tests of employment

The traditional tests used to determine if an employed person is an employee
or a self-employed trader are:
• The control test
• The organization test
• The ordinary person test
• The indicia test
• The economic reality or multiple test
• The self description test.
Control test
This is the oldest test and is drawn from master/servant rules ‘from the servant
is due obedience and respect – from the master protection and good treatment’
Linland v Stephens 1801.
The fundamental question to be asked here is ‘Does the employer direct and
control?’ If the answer is ‘Yes’ then the person is an employee.
Organization test
Is the person part and parcel of the organization? Stevenson Jordan and Harrison
v McDonald and Evans 1952.

Ordinary person test

Is there a contract of service with meaning that an ordinary person would give?
Collins v Herts CC
Indicia test
1. Masters’ (employers’) powers of selection
2. Presence of wage payment
3. Masters’ (employers’) right to control
4. Right of suspension or dismissal
Short v Henderson 1946
Economic reality or multiple test

This is a three part test – a contract of employment exists if there is the following:
1. An agreement to provide skill and work in return for a wage.
2. Express or implied submission to control.
3. Nothing significant inconsistent with employment.
This is a pragmatic approach which takes all factors into account, e.g. degree
of control; obligation to give work and obligation to accept; provision of tools
and equipment; responsibility for tax and NHI payments; freedom to do other
work; holiday entitlement; entitlement to notice; expenses; financial risk;
duration of engagement etc.
Self description test

This test may be as simple as asking ‘….is this person performing services in
business on his own account..?’ Market Investigations v Minister of Social Services
1969.
Other forms of work relationship

• Labour only subcontractors – the lump
• Labourers in construction industry – self employed
• Casual employment – usual test is mutuality of obligations
• Agency staff – usually seen as self employed

• Outworkers – historically seen as independent
• Directors – may be employed or self employed
• Part-time employees – now covered by all employment legislation
Forming the contract

Contracts of employment define the legal relationship between the parties. The
contract consists of everything that is agreed between them. It is almost impos-
sible to include every aspect of the job in writing, although some ‘Service
Agreements’ issued to senior staff and directors often try!
Because of this the actual content of all contracts will be fluid. Jobs are never
static; they are constantly changing with the passage of time as businesses and
people grow, change and develop. Documentation defining the job, and hence
the contract, need to be reviewed from time to time to reflect any major changes
that have occurred.
The contract can be oral, written, or deduced by conduct, but to meet the require-
ments of employment law they require evidence by way of a Statement of Written
Terms and Particulars of Employment – Employment Rights Act 1996 Section
1.
However, the law does require written contracts for:
• Apprentices
• Merchant seamen/women
• Some fixed-term contracts.
The only legal requirement is that the ‘S1 Statement’ be in writing. However,
the ‘S1 Statement’ is not the contract, simply evidence of its main terms.
All contracts of employment consist of three elements:
• Pre-contract terms (subject to);
• Contract terms (specific and implied) ;
• Post-contract terms (restrictive covenants).

Pre-contract terms
These terms set out the requirements that the candidate for a position must meet
if they are to proceed to the full contract. Such requirements as the provision
of references, passing a medical examination, sight of qualifications, driving
licence etc, are all common requirements set out as pre acceptance clauses in
offer letters. The offer letter often uses the words ‘subject to…………………’ these
requirements being met, before the offer of employment moves to a full contract.
Contract terms
The actual contract terms will consist of four main elements:
1. The express terms set out in writing – the written particulars and any
other matter that the employer feels is relevant to the job, and important
to be set out in the main terms of contract.
2. The implied terms (see below) comprise those terms that are obvious
and would be present in any intent by any parties intending to be bound
in a legal relationship. Such matters as the expectation of loyalty,
integrity, faithfulness etc.
3. The statutory terms – terms incorporated by statute – i.e. the rights

given to employment by Parliament or by EU law known commonly
as ‘statutory terms’. These terms are present in all contracts of
employment and as such do not require setting out in writing.
4. One final element can also be included called ‘Custom and Practice
terms. More on this later.
Post-contract terms
These terms are known as ‘restrictive covenants’ – are those which bind the
employee after the employment has ended. These are often very specific both
in time – the period in which they will continue to apply after employment has
ended – and in the protection afforded to the employer. To be validated by the
courts any restrictive covenant needs to be ‘reasonable’ and only seek to protect
that which the employer owns, such as internal business information, client lists
and trade secrets of which the employee would have had no knowledge without
working for the employer. Employers must exercise great care when drafting
restrictive covenants to ensure that they do not become ‘restraints of trade’ and
therefore unenforceable in law. A restraint of trade is defined as a requirement
drawn so tightly that its operation prevents the ex-employee from earning their
living, by selling and exercising their skills and abilities.

Formalities
For any contract of employment to come in being there must be an offer and
unconditional acceptance of work.
1. The offer may be oral, or in writing or made through advertisement.
2. Offers can be conditional, (pre-contract) i.e. subject to satisfactory

references, medical, sight of qualifications, certificates etc.
3. Acceptance can be in any form e.g. orally, handshake or signature.
4. The parties must intend to be bound, i.e. to create a legal relationship

between themselves.
5. There must be consideration – wages/salary – the promise of work for

wages.
Contracts: the four elements

As set out previously, contracts comprise four elements: firstly ‘express’ terms,
secondly ‘implied’ terms, thirdly ‘statutory’ terms and finally, terms that arise
through the operation of what is called ‘custom and practice’. The parties may
agree any terms that are legal.
Express terms
These can include:
• Specific terms agreed by parties;
• Things referred to but contained in other documents;
• Everything required to be in the ERA S1 statement;
• These must be consistent with employment.
The written statement must accurately represent the agreement entered into
between the parties. Express terms ensure that this happens.
It is advisable to keep express terms broad to ensure easy interpretation. The

express terms should refer to Disciplinary Rules and Procedures – although
these can be a mix of contractual and non-contractual. This distinction is impor-
tant as only non-contractual items (policies) can be changed unilaterally, as
they are developed by the board of directors or senior management. All other

changes to the contract terms will require consultation and prior agreement
before implementation.
It is important that the terms of the contract accurately reflect the needs of the
business. It is recommended that before drawing up a contract, those matters
which are fundamental to the operation of the business be listed. What are the
key aspects of the job and the business?
• In construction it could be safety and the security of materials and

property; high standards of workmanship and observance to detail.
• In haulage it could be observance of traffic rules, laws and the

maintenance and security of vehicles and goods.
• In catering it could be hygiene, cleanliness and customer service.
Well written contract terms reflect the nature of the business. Like buying an
‘off the peg’ suit it can be a serious and expensive mistake to simply copy the
terms and conditions of another business and apply them to your own business,
only to find out later at an Employment Tribunal that they do not fit.
Implied terms
Implied terms are prevalent through Employment and Contract Law and apply
to all contracts irrespective of whether they are included as express terms or
not. These rights do not require setting out in writing within the contract as
they apply to all employed persons by force of ‘case law’ i.e. ‘law’ developed by
the workings of the courts and the decisions they reach.
Implied terms are those that are ‘obvious’ – such as:
The employers’ duties to their employees:
• To pay wages (although details are required to be included in the S1

Statement of Particulars).
• To provide work.
• To take reasonable care of employees.
• To provide safe systems of work, plant, equipment etc.
• To not cause psychiatric harm.
• To indemnify for all reasonable expenses.
• To give mutual trust and respect.
• To protect from harassment of all forms.

• To protect confidentiality.
• To deal properly with grievances (now given greater significance by

EA2002).
The employees’ duties to the employer include:
• The need to obey all lawful and reasonable instructions.
• To exercise care and skill whilst carrying out their duties.
• To protect their employers’ property.
• To adapt to necessary changes (after consultation and communication).
• To give faithful service to their employer.
• To not harm their employers’ business.
• To not compete with their employer.
• To disclose misdeeds of colleagues.
• To not misuse, or disclose to third parties (not entitled to know)

confidential information about their employers’ business.
• Not to make a secret profit from their employment.
Statutory terms
These are terms imposed by legislation – the ‘third party’ to the contract. They
are the minimum terms that must be applied to all employees irrespective of
whether they are stated in the written particulars or not. For example, the entitle-
ment to 20 days’ holiday a year for full-time employees, or pro- rated for part-time
employees. Employers are free to offer terms in excess of the minimum, but must
apply the minimum to all employees irrespective of any other specific terms agreed
between them.
The only bodies that can interfere with the terms of a contract freely entered
into by an employer and an employee are:
1. The government – through legislation; over the last 30 years many rights
have been included into the contractual relationship of employer and
employee through legislation.
2. The European Union – again through legislation and EC judgments

– the Working Time Directive governing the number hours employees
can work, for example.
3. The courts – that can interpret the intentions of parties.

Custom and practice

Custom and Practice, as its name implies, develops over time, regardless of the
express terms written within the contract. For example, an employer can expressly
agree that an employee will commence work at 8.30am. However, an employee
can over time regularly arrive for work at 9.00am. If the employer does nothing,
in effect he/she condones the later start time, over time 9.00am will become the
‘custom and practice’ contractual start time. A change to the contract will have
occurred due to the employer’s failure to insist on the express term being
observed.
Custom and practice covers all the peripheral aspects of the job which can change
over time: working arrangements not committed to paper; understandings
entered into within work groups and between supervised and supervisors etc.
The minutiae of working life that are never, in fact can never, be fully recorded
or included in any documentation.
The Employment Rights Act S1 – ’written

statement of particulars’
This must include:
• The names of both employer and employee.
• Full postal address of employer and place of work.
• Date of commencement of employment.
• Date of commencement of continuous employment.
• Scale of remuneration, method of calculating pay, pay period.
• All terms concerning hours of work
• Holiday entitlement, including public holidays and holiday pay.
• Provision for sickness and sick pay.
• Pension rights and schemes.
• Periods of notice on both sides.
• Period of employment, if not permanent.
• Details of any collective agreements affecting conditions of employment.
• Details of any disciplinary rules – (subject to statute).
• Details of grievance procedure – (subject to statute).

• If no particulars apply under any heading then that fact should be stated.
• The statement may refer the employee to other documents where the
specific information is held.
• The statement must be issued within eight weeks of employment

commencing.
Note: The S1 statement is not the contract, merely evidence of its terms.
If an employee brings a claim to an Employment Tribunal under Section 38,

Schedule 5 of the Employment Act 2002, which sets out the tribunal’s powers
of jurisdiction, the tribunal may consider the nature of the employee’s written
statement. If there is no statement, or it is found to be incomplete, or inaccu-
rate, and the employee’s claim is successful, the tribunal is required to award
additional compensation to the employee of between two and four weeks pay.
The legal requirements allow reference in the statement to documentation that

is held in other places, such as employee handbooks, information manuals, and
the like, provided these are readily and easily accessible to the employees to whom
they apply.
Changing the terms of a contract

of employment
Contracts are not ‘set in stone’ when they are formed. They can be changed to
reflect the changing nature of the business, or the employee’s circumstances.
Consultation and agreement are essential, however, before any significant change
is implemented. Neither side can unilaterally change the terms of a contract
without the consent of the other party to the contract. To do so is to risk a
successful breach of contract claim.
As the contract is entered into by mutual agreement, then any change to the
agreed terms must also be mutually agreed. Where agreement cannot be reached
between the parties the employer has the right, as employees do, to end the
contract if there is no alternative course of action open to them. They must,
however, be able to demonstrate that they have first explored and exhausted
all possible alternative courses of action before proceeding to go about ending
the contract, in accordance with its terms, regarding notice entitlement, and
the requirements of statute.

Any unilateral change to a fundamental term of the contract of employment,

such as pay, hours, holidays, location etc, could lead to a successful claim for
‘Constructive Dismissal’. (See Chapter 7.)
Summary
The contract of employment is the starting place when considering any aspect
of employment. By its very nature it is the hub around which all other aspects
of employment revolve. When any dispute arises the first place to look when
seeking to resolve any issue that may have arisen is the terms of the contract
of employment. Questions must be asked such as:
• What was agreed between the parties?
• Has ‘custom and practice’ changed the agreement?
• What has happened to disturb the agreement?
• Is this a breach of the terms?
• If so, is it a minor or a major breach?
• Can it be rectified through discussion and agreement?
• Will a warning, either verbal or written, be sufficient to resolve the

matter?
• Is the action so serious that it has brought the agreement to an end?
• Have the requirements of the Disputes Resolution Regulations been

followed in full?
• Could any claim to Employment Tribunal be successfully defended?
The rules, disciplinary and grievance procedures are an integral part of the
contract of employment and the next chapter explains why.

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 3
Disciplinary rules
Disciplinary rules: an introduction ....................................................26
Drafting the rules.................................................................................27
Health and safety rules........................................................................29
Communicating the disciplinary rules ..............................................30

Chapter 3
Disciplinary rules
Disciplinary rules: an introduction

The ACAS Disciplinary and Grievance Procedures Code of Practice, the latest
issue of which came into effect on 1st October 2004, was brought in to support
the requirements of the Employment Act 2002, in particular the Disputes Resolu-
tion Regulations, which also came into force on 1st October 2004.
The Code states that its intention is to:
Provide practical guidance to employers, workers and their representatives on:
• The statutory requirements relating to disciplinary and grievance issues;
• What constitutes reasonable behaviour when dealing with disciplinary

and grievance procedures; and
• A worker’s right to bring a companion to grievance and disciplinary

hearings.
A failure to follow any part of the Code does not, in itself, make a person or
organization liable to proceedings. However, Employment Tribunals will take
the code into account when considering relevant cases. Further, a failure to follow
the statutory disciplinary and grievance procedures where they apply may have
a number of legal implications which are described in the Code. As such, the
Code is well worth obtaining, reading and retaining for reference purposes. In
the main it is written in plain English and is easy to follow.
Disciplinary rules become an integral part of employees’ terms of contract when

they are explicitly referred to in the express terms of the contract. Properly written
they tell employees what behaviour their employer expects of them, as such,
they form part of the contract of employment.
It is a legislative requirement that information on the rules and disciplinary proce-

dures that apply to employees are set out, or referred to, in the S1 ERA Statement
of Terms of Particulars. When drawing up rules the aim should be to specify
those ‘that are necessary for ensuring a safe and efficient workplace and
for maintaining good employment relations’. (ACAS guide to discipline and
dismissal).

3 D I S C I P L I N A RY R U L E S
In essence the term ‘discipline’ is a misnomer in commerce and industry, for

the purpose of all rules should be to set down for employees what is accept-
able and unacceptable behaviour; they are guidelines for employees in the
standards expected of them when fulfilling their contractual obligations to their
employer, not trip wires designed to catch them out. Their aim should always
be to provide information to employees on the standards that they must maintain
if they are to effectively perform their side of the contract.
Drafting the rules

To be effective rules must be:
• Clear and unambiguous;
• Written in ‘plain English;’
• Understandable by all employees irrespective of their native tongue,

or level of educational attainment;
• Accepted as fair and reasonable by those to whom they apply; and
• In relation to the nature of work and the job.
Rules should not only set out the boundaries of behaviour and performance
required of employees, but they should define the category within which each
rule falls, indicating the severity with which any breach of them will be treated.
Actions which are unacceptable, but not fundamental breaches of contract should
be indicated. Similarly, actions which would constitute a repudiation of contract
need to be clearly set out. What could be seen as gross misconduct in certain
organizations might merely be misconduct in others.
Organizations should aim for clarity and simplicity when communicating the
expected standards of behaviour and performance to their employees. This can
make the difference between winning and losing at an employment tribunal
hearing.
It is unlikely that any set of rules will cover all possible disciplinary issues; each
organization will have its own particular needs. But rules usually cover:
• Unsatisfactory work performance
• Harassment, victimisation or bullying
• Misuse of company facilities (such as e-mail, internet, vehicles and other

equipment etc)

• Poor timekeeping
• Unauthorised absence
• Failure to follow instructions
• Failure to observe safety rules
• Misconduct – which can cover a wide definition
• Gross Misconduct
• A ‘catch-all clause’ stating that any given list is not exhaustive
• Health and safety matters.
Rules should be specific, clear and set out in writing. They also need to be readily
available to all employees. Management should do all that they can to ensure
that every employee knows and understands the rules, including those
employees where English is not their first language, or whose reading ability
is low. The aim when drafting rules should be to write them at a ‘reading age’
level of 12. This is the reading age at which the popular tabloid newspapers are
written.
Acts which constitute Gross Misconduct need to be presented separately from

other forms of breach of contract. Examples of Gross Misconduct might include:
• Fighting or drunkenness
• Illegal drug taking and alcohol use during working hours – (or outside
if driving or flying is involved)
• Theft or fraud
• Physical violence or extreme bullying
• Deliberate and serious damage to property
• Serious insubordination
• Unlawful discrimination or harassment
• Bringing the organization into serious disrepute
• Serious negligence
• A serious breach of health and safety rules
• A fundamental breach of trust and confidence.
When drafting rules, employers should start by asking what is important to their
business. The standard terms covered by the above list may not be adequate
or appropriate to meet the needs of the business. Employers must ensure that

their rules are relevant to their business, and concentrate the minds of their
employees onto those things which are important to the success of their business,
or the attainment of the businesses’ defined objectives. Businesses do not operate
in a vacuum. They have specific purposes and are directed to meet specific needs
and market places. The rules, as guidelines for employees, should define and
emphasise these needs and objectives. It is all very well drafting mission state-
ments, but unless the rules, employee guidance systems and training programmes
are clearly directed to achieving the mission of the business, then the mission
statement risks being just words without a link to the way in which the business
works on a day-to-day basis. The rules will give a very good guide to the business
ethos and philosophy.
Health and safety rules

One important area in which rules are essential is health and safety at work.
The courts take health and safety issues very seriously. Health and safety rules
require drawing up entirely separately from the broad and general rules which
govern capability and conduct etc., (although they are clearly linked to conduct).
They need developing in conjunction with health and safety specialists and need
to be directly related to the nature of the business. The law on health and safety,
that was first enshrined in the Health and Safety at Work Act etc. 1974, and which
has been added to and amended significantly since, requires employers to carry
out risk assessments on all activities that take place within their businesses. These
risk assessment, from which safe working practices can be developed, will deter-
mine exactly what requires to be included within the safety rules of the business.
Properly drawn up they will make the task of defining general safety rules, which
are merely rules for guidance, from those whose observance is mandatory,
through to those rules which, if breached, will fall into the category of Gross
Misconduct.
An employer who fails to have clear defined rules covering every aspect of health
and safety drawn up within their business, is likely to be found to have acted
negligently in the event of a serious accident or incident. A breach of the health
and safety laws is a criminal act which can lead to:
• The issue of Improvement Notices to correct defective plant equipment

and processes;
• Prohibition Notices which stop all work in the area concerned until
certain specific requirements have been met;

• Fines imposed on both individual managers and directors; and
• Imprisonment for directors who have failed in their duties and whose
failure has led to serious incidents or accidents arising.
As I write, five executives – three from Railtrack, which later became Network
Rail and two from the engineering company Balfour Beatty – are on trial for
the manslaughter of four passengers who died in the 150mph crash on
October 17, 2000 (The Hatfield Rail Disaster). These executives also face further
charges brought under the Health and Safety at Work Act.
Health and safety rules need linking to the general rules so that a failure to observe
them will lead automatically to their enforcement through the operation of the
businesses’ normal disciplinary procedure. All too often in my experience, this
essential linking is missing. I have found many instances where the health and
safety rules appear to have been developed in a vacuum and not linked across
to become an integral part of the organization’s normal standard operating rules
and procedures.
Communicating the disciplinary rules

The style and presentation of rules does not need to be intimidating and boring.
Many organizations go to great lengths to bring the same level of presentation
skill into producing and presenting their rules as they do to marketing their
products and services. They include colour and cartoon characters to highlight
aspects of the documents and draw employees attention to what is important
in them. It is a mistake to confuse the seriousness of the purpose for which rules
are intended, with the style of presentation. Attractive interesting documents
get read and are retained longer in the awareness of staff than boring, dull repet-
itive prose.
It is essential that all employees understand the standards expected of them as

set out in their employers’ disciplinary rules. Their first detailed knowledge of
them should result from a clear explanation being given to them during their
induction programme. This explanation should be tailored to the recipient. Where
English is not the new employee’s first language then efforts should be made
to obtain a translation into the new employees’ native language. The ‘reading
age’ of the employee should also be taken into account. Employees with a low
reading age are often reluctant to admit to this fact, as such employers should
make efforts to ensure that employees actually understand what is being read,
or presented to them.

During the induction programme for new employees every opportunity should
be taken to ensure that the new employee thoroughly understands not only what
is in the rules, but the thinking and reasoning behind them. Particular atten-
tion should be given to safety rules, with demonstrations being given where
safety clothing and other safety equipment is to be worn or used. Employees
must appreciate that the use of such safety clothing or equipment is not an option,
but an essential feature of their work within the business. At the conclusion of
the induction programme, employees should be required to sign to state that
they have read, (or have had read to them) the rules that apply to them, and
more importantly that they understand the rules and the reasoning behind them.
Copies of the rules should be given to each employee, or be readily accessible

to them in a central location. The main danger with issuing sets of rules and
related procedures to employees is the need to keep such documentation up to
date with the passage of time. This task is made much easier if the documen-
tation is held at a central location that is easily accessible to employees with the
facility to photocopy sections of the rules and other procedure as and when they
are needed.

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 4
Disciplinary procedures
Disciplinary procedures and the law.................................................33
Modified disciplinary procedures and gross misconduct...............35
The ACAS guide to disciplinary procedures....................................37
Special situations ................................................................................39
Summary .............................................................................................40
Chapter 4
Disciplinary procedures and the law

The law on unfair dismissal requires employers to act ‘reasonably’ when dealing
with disciplinary issues. What is classed as ‘reasonable’ behaviour will depend
on the circumstances of each case, and is ultimately a matter for the Employ-
ment Tribunals to decide. Case law over the years has defined the boundaries
of ‘reasonable’ in most types of dismissal, however the role reversal approach
can usually help the manager determine what would be considered as reason-
able; i.e. “How would I feel is this were happening to me?” “If I were being treated
this way would I believe that I was being treated fairly?” There is no doubt,
however, that following the advent of the Dispute Resolution Regulations from
the beginning of October 2004, the operation of a DDP will be an essential require-
ment if the action involved is to pass the ‘reasonableness’ test applied at tribunal.
Research undertaken by the DTI in 1998 showed that over 60% of Employment
Tribunal claims were lodged before any discussion had taken place between the
employer and the employee. The government, concerned to see that litigation
via an Employment Tribunal was not seen as the first option for resolving work
place problems, decided to introduce statutory dismissal, disciplinary and griev-
ance procedures (DDPs) and GPs (see Chapter 8) – which employers and
employees alike would be required to follow.
The consequence of an employer or an employee’s failure to comply with an

applicable DDP can be serious. Where an employee with at least one year’s service
has been dismissed, and where the employer has failed to comply with the appli-
cable DDP, the employer will be liable to incur an automatically unfair
dismissal decision. Further, where an applicable DDP has not been completed
owing to the fault of either the employer, or the employee, the compensation
awarded to the employee in the event of a successful Employment Tribunal claim
can be adjusted upward or downward by between 10% and 50%.
The Employment Act 2002 lays down the minimum requirements for Discipli-
nary Procedures which under the Dispute Resolution Regulations are
incorporated in every employment contract with effect from 1st October 2004,

4 D I S C I P L I N A RY P R O C E D U R E S
irrespective of the size of the employing organization. The regulations lay down
as a minimum a ‘three step’ disciplinary dismissal procedure (DDP), or a
‘two step’ modified procedure. The ‘three step procedure which applies to
standard disciplinary action and any resultant dismissals is:
1. Written notification to the employee of the alleged breach of contract.
2. A meeting to discuss the alleged breach including any nominated

representative of the employee.
3. Opportunity for the employee to appeal against any decision to impose

a disciplinary penalty.
This procedure also applies when an employer is contemplating action short

of dismissal, such as a warning etc. and when suspending an employee
without pay or on reduced pay. The new three step requirement must apply when
fixed term contract dismissals happen (except when they are less than one year
in length).
The Dispute Resolution Regulations define ‘relevant disciplinary action’ to which

the standard DDP applies, as ‘action short of dismissal, which the employer asserts
to be based wholly or mainly on the employee’s conduct or capability, other than
suspension on full pay or the issuing of warnings.’ Note: This definition excludes
redundancy or action which could arguably fall under the heading of ‘Some Other
Substantial Reason (SOSR)’ although this heading must by definition include
issues which common sense would advise that the DDP applies to.
‘Action short of dismissal’ is defined as any ‘act or omission’, action taken, or

a failure to take action. Other than this, the regulations give little guidance as
to what constitutes ‘action short of dismissal’. So the best steps a manager or
employer can take are to ensure that when dealing with any aspect of an
employee’s performance, or conduct, to ensure that the three step DDP is followed.
When in doubt, apply the DDP and thus ensure that if an Employment Tribunal,
at a later stage decides that the act or omission complained of was ‘action short
of dismissal’, then the relevant DDP steps will have been followed and recorded
as such. Better safe than sorry.
Although employers will be obliged to follow the standard DDP when handling
both conduct and capability issues, they should not confuse the two. An employee
called to a meeting to discuss a performance or capability issue should not be
made to feel that they are undergoing a ‘disciplinary’ process. Rather it should
be emphasised that the purpose of the meeting is to discuss whether any action
on their part, or the part of their employer could lead to a resolution of the
‘capability’ issue under discussion. It is good industrial relations practice to distin-
guish between capability and conduct.

Employers must note that the DDPs are intended to provide minimum standards
for all employers. While it is clear that a failure to follow the minimum proce-
dure will lead to automatic sanctions taking place against the employer, it does
not follow that an adherence to them will lead automatically to a finding of a
‘fair’ dismissal. As always, the facts of a case backed up by relevant case law
will determine if the dismissal was reasonable i.e. fair, or not. However, if the
new DDP is followed it will considerably reduce the likelihood that an employer
will suffer an unfair dismissal on the grounds of a procedural fault. It should
be borne in mind that in any unfair dismissal claim, the tribunal will always
consider whether there were any steps the employer could ‘reasonably’ have
taken, in addition to the minimum requirements, when carrying out the
dismissal. If the tribunal decides that there were additional steps that a reason-
able employer would have taken when dealing with the type of issue before them,
then the door is still open to them to make a finding of unfair dismissal.
It is worth bearing in mind at this point that the majority of unfair dismissal
decisions found against employing organizations over the years have been on
the grounds of ‘procedural fault’, rather than the fact that the employer did not
have good grounds for dismissing the employee concerned.
Modified disciplinary procedures

and gross misconduct
The Regulations recognise the fact that in certain instances of dismissal the full
Three Step procedure may not be appropriate, and so introduced a short Two
Step modified procedure that could apply in certain circumstances. The Regula-
tions set four elements that must be present before the modified Two Step
procedure can be used properly, instead of the standard Three Step DDP:
• Where the employer dismisses the employee by reason of his or her

conduct;
• The dismissal occurred at the time that the employer became aware
of the conduct, or immediately thereafter;
• The employer was entitled, in the circumstances, to dismiss the

employee by reason of his or her conduct without notice or payment
in lieu of notice; and
• It was reasonable for the employer in the circumstances to dismiss

the employee before enquiring into the circumstances in which the
conduct took place.

The effect of this is that the modified DDP will apply in only a very small number
of gross misconduct dismissals.
In the small number of instances where the modified DDP might apply, the Regula-
tions state that the employer must:
a) Set out in writing:
• The employee’s alleged misconduct which has led to the dismissal;
• What the basis was for thinking at the time of the dismissal that
the employee was guilty of the alleged misconduct; and
• The employee’s right to appeal against the dismissal.
b) Send the statement, or a copy of it, to the employee.
For the modified Two Step procedure to apply, the employee will have to have
been dismissed for gross misconduct before the procedure can be initiated.
The first step in the procedure will consist of an explanation by the employer
of why the dismissal took place. The employer must set out in writing the basis
for thinking that the employee was guilty of the misconduct in question – bearing
in mind that the employer may not, in these circumstances, have carried out a
full investigation into the facts surrounding the matter before reaching the decision
to dismiss.
The second step deals with the appeal process and the Regulations state that:
• If the employee does wish to appeal, he or she must inform the

employer;
• If the employee informs the employer of his or her wish to appeal, the
employer must invite the employee to attend a meeting;
• After the appeal meeting the employer must inform the employee of
the final decision.
It is a well established principle in common law that the employer is entitled to

terminate a contract of employment summarily by reason of the employee’s
dishonesty, negligence or disobedience. The degree of misconduct, however,
must amount to a repudiatory breach of the contract i.e. must be so serious as
to ‘destroy’ the contract.
When should employers use the modified Two Step procedure? It is rare for an
Employment Tribunal to find a misconduct dismissal fair where there has not
been an investigation into the employee’s alleged behaviour that did not first

include the opportunity for the employee concerned to put his or her side of
the matter, and to challenge all evidence or any witnesses against them.
The introduction of the Two Step procedure into the Regulations has the poten-
tial to confuse employers. Best practice would advise that no dismissal takes
place without the employee first being given every opportunity to present their
side of the case. If the issue is so serious as to indicate the appropriateness of
instant dismissal, then the employer would be well advised to first instantly
suspend the employee on full pay and benefits (unless the contract of employ-
ment allows otherwise). To in effect make time to consider the matter in a calm
and logical manner, and not be pressurised into making hasty and possibly ill
informed decisions that could prove expensive at a later date. To do otherwise
is to risk a finding of unfair dismissal.
The opportunity to appeal against dismissal allowed for in the modified proce-
dure would allow the employee the chance to put their side of the matter – but
only if the employee exercised the right of appeal and did not proceed directly
to tribunal.
The ACAS guide to disciplinary procedures

This guide sets out the core principles that must be observed when drawing up
a disciplinary procedure. These are:
• Disciplinary procedures be used primarily to help and encourage

employees to improve, rather than just as a way of imposing a
punishment.
• Employees be informed of any complaint against them and provided

with an opportunity to state their case before any decision is reached.
• Where appropriate, employees can be suspended from work to

facilitate investigation, particularly in cases of alleged misconduct or
gross misconduct. Where suspension is used employees should
receive full contractual pay and benefits for any period of the
suspension, unless the contract of employment allows otherwise.
• No disciplinary action should be undertaken until the facts of a case

have been established and it is clear that any disciplinary action
contemplated is reasonable in the circumstances.
• Employees being allowed to be accompanied at any disciplinary

meetings.

• Employees never being dismissed for a first disciplinary offence unless

it is a case of gross misconduct.
• Employees being provided with a written explanation for any

disciplinary action that is to be taken against them with steps being
taken to ensure that the employee is fully aware of what improvements
are expected of them.
• Employees being given an opportunity to appeal against any

disciplinary action taken against them.
• Issues of a disciplinary nature being dealt with as thoroughly and

promptly as possible.
• Employers making every effort to act consistently in all matters of

discipline.
The code goes on to say that good disciplinary procedures should:
• Be in writing;
• Say to whom they apply;
• Be non-discriminatory;
• Allow for matters to be dealt with without delay;
• Allow for information to be kept confidential;
• Tell employees what disciplinary action might be taken;
• Define and say what levels of management have the authority to take
disciplinary action;
• Require employees to be informed of the complaints against them; and

supporting evidence before any meetings take place;
• Give employees every chance to have their say before management

reaches any decision;
• Provide employees with the right to be accompanied at all disciplinary

and grievance hearings;
• Provide that no employee is dismissed for a first breach of discipline

except in cases of gross misconduct;
• Require management to investigate fully before any disciplinary action

is taken;
• Ensure that employees are given an explanation for any sanction; and
• Allow employees to appeal against any decision.

When operating Disciplinary Procedures employers must:
• Establish the facts before taking any disciplinary action.
• Deal with cases of minor misconduct informally.
• Follow formal procedures for more serious cases, including informing

the employee of the alleged misconduct or unsatisfactory performance.
• Invite the employee to a meeting and inform them of their right to be

accompanied.
• Where performance is unsatisfactory, explain to the employee the

improvement required, the support that will be given to assist them
to achieve this, and when and how their performance will be reviewed.
• When giving a warning, tell the employee why and how they need to
change, the consequences of failing to improve, and that they have a
right of appeal.
• If dismissing an employee tell them why, when their contract will end,
and that they can appeal.
• Before dismissing or taking other disciplinary action other than issuing

a warning, always follow the statutory disciplinary and dismissal
procedure.
Special situations
Arrangements may be necessary within disciplinary procedures, depending on
the nature of work and work pattern undertaken:
• To handle problems that arise on a night or weekend shift when a full

complement of managers may not be present.
• If action is contemplated against a trade union representative to whom

legislation affords special protection.
• Where criminal charges or convictions occur that are not related to

work, the employer must establish the facts and then determine whether
a breach of contract has occurred. The fact that a charge or conviction
has been made against an employee is not of itself sufficient to dismiss
an employee safely. Nor would absence due to being placed on remand
justify employment termination.

Circumstances in which the new Dispute Resolution Regulations procedures

do not apply are:
• In some collective redundancies;
• Where there is a dismissal then re-engagement with no break in service;
• In industrial action dismissals;
• Where ‘Constructive Dismissal’ is claimed (the new Grievance

Procedure applies);
• When contractual employment contravenes the law;
• Where an employee has complained to an employment tribunal before

One Step of the modified procedure was activated;
• Employers’ business suddenly ceases due to unforeseen circumstances

(death of proprietor or similarly serious event).
Summary
The purpose of any disciplinary procedure should be to enable the employer
to bring to the attention of an employee any alleged breach of their contract of
employment, in order that, wherever possible, it may be rectified. Their
purpose is not the dismissal of the employee concerned. The true purpose of
any disciplinary procedure is to provide a mechanism whereby breaches of
contract can be discussed between an employer and employee, in an orderly,
civilised and constructive manner, so that the breach of contract complained
of, can be identified, discussed and remedied.
When a contract of employment is created, both parties commit to acting toward

the other in a manner designed to preserve the contract. An agreement has been
entered into. On the employer’s part, in return for the provision of wages, benefits
and a structure within which the employee can perform his/her work, they expect
in return loyalty, commitment and an intention on the part of employees to work
to achieve the aims and objectives of their organization. On the employee’s part,
they expect their employer to provide them with pay and the tools and organi-
zational framework to enable them to carry out their duties. Both sides expect
the other to act towards them in a reasonable and responsible way. Where one
party fails in this regard the other can draw this to their attention for explana-
tion and rectification. The employer does this through the operation of the
disciplinary procedure; the employee through the grievance procedure. In both

cases the specific issues that the party concerned believes need attending to are
drawn to the attention of the other in a structured and formalised way.
Where an employer allows a breach of contract to go unchallenged over a period

of time, this can lead to the contract being changed through ‘custom and practice’.
The normal procedural steps required to remedy a breach of contract are, in

descending order:
1. Investigation to confirm that a breach has occurred.
2. Informal discussion on the issue between supervisor and employee.
3. Verbal warning requiring the employee to follow specific instructions

given by the supervisor/manager.
4. First written warning setting out the actual breach of contract and
warning being given to the employee with regard to their future
conduct.
5. Final written warning clearly stating that any further breach of contract
will lead to the contract of employment being terminated.
6. Dismissal – with contractual notice – unless the action complained of

is ‘gross’.
In certain instances the actions of the offending party can be so ‘gross’, so outra-
geous, as to demonstrate the intention of that party to be no longer bound by
the terms of the contract (agreement). A repudiation of contract then occurs.
Where an employee acts in this way an act of ‘Gross Misconduct’ is deemed to
have taken place. Where an employer acts similarly in an outrageous manner,
the employee can conclude that they have been ‘Constructively Dismissed’. The
actions of the employer having brought the contract to an end. In either case
it can be taken that the contract has been irretrievably destroyed by the actions
of the other; in effect the contract is over.
It is for this reason that Gross Misconduct offences lead to dismissal without
notice. Notice cannot be given to end an agreement that is demonstrably over;
destroyed by the actions of the employee.
The introduction by the Dispute Resolution Regulations of the Three Step, and
Two Step procedures does no more than formalise what has been good practice
in commerce and industry for many years. Their introduction will hit hardest
with small employers who have previously managed their businesses without
formal procedures and, who through the introduction of the Regulations, will
be required to introduce a degree of formality in their business which may at
first appear alien and foreign to their management style. Over time, however,

these procedures should become the norm and second nature to all employers
and employees. The work of the Employment Tribunals will certainly be eased
by the introduction of the new formal procedures, as there is no doubt that
properly used, the job involved in determining if a dismissal is fair or unfair,
will be made much easier.

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 5
step-by-step
Investigation.........................................................................................44
Informal disciplinary action ...............................................................47
Formal disciplinary action..................................................................47
Invitations to a meeting ......................................................................48
Provision of evidence ..........................................................................49
The right to be accompanied..............................................................50
The disciplinary meeting.....................................................................51
Handling disciplinary meetings .........................................................53
Records of disciplinary meetings.......................................................56

Chapter 5
step-by-step
Investigation
No disciplinary action should be contemplated by a manager or supervisor before
they are sure, on the information available to them, that a breach of contract
has occurred. Any management activity not associated directly with achieving
the aims and objectives of their employing organization, such as dealing with
possible breaches of contract, is expensive, potentially disruptive and time
consuming. Discipline is not an end in itself; the question must always be asked
as to whether the possible breach of contract being considered is one which
damages, or has the potential to damage, the organization concerned. If the
answer to this question is ‘No’ then thought should be given as to the desir-
ability of proceeding further with the disciplinary action being considered. Action
taken on ‘moral grounds’ may make managers feel good, but may not be a proper
use of their time. It may be that with a little thought the problem under review
can be dealt with far more effectively through management appraisals, extra
training, or the introduction of fresh operating procedures.
Managers should also be wary of leaping to conclusions too quickly, as on

occasion things may not be what they seem.
Years ago when working as a Personnel Manager in a large truck manufacturing

plant in Dunstable I was, with my management colleagues, grappling to deal
with an outbreak of wanton vandalism and sabotage of plant, equipment and
components. Our truck and van assembly lines were being systematically
damaged to prevent them working smoothly, leading to large amounts of ‘down
time’ when production was halted. Also, components were being deliberately
damaged making them unfit for use.
Whilst working in my office one August morning preparing for a round of trade
union pay negotiations with the staff unions, I was rudely interrupted by the
Plant Director bursting into my office hauling with him a clearly frightened and
indignant production operator.

5 D I S C I P L I N A RY P R O C E D U R E S S T E P - B Y- S T E P
“I’ve caught one!” exclaimed the florid faced and clearly angry Plant Director
gesticulating to the employee. “I caught him red-handedly attacking a gearbox
with a hammer in an attempt to damage it. I want him sacked immediately!”
With that the Plant Director swept out of my office leaving the employee and I
looking at each other. As the Director departed, I heard my outer office being
filled with shop stewards, who were demanding to know why one of their
members had been manhandled off the assembly line by the Plant Director.
I sat the employee down and invited the most senior shop steward into my office
to act as his representative as I attempted to get to the bottom of what had actually
happened. Through interviewing the employee and subsequently his supervisor,
I managed to ascertain what had happened which led to the man being hauled
into my office in such an unceremonious manner. It appeared that the operator
had only been working on this section of the assembly line for one shift, of which
only one hour had elapsed. His job entailed fitting the front end of the exhaust
system underneath the vehicle, next to the rear of the gearbox. He had been
instructed in this activity by another operator who had been carrying out the
same function the previous day. This operator had found that the front end of
the exhaust pipes were slightly misaligned and in order to maintain production
he had taken to hitting the pipes with a large hammer to correct the misalign-
ment. He had pointed out the necessity for this crude rectification process to
the new operator, who now sat in my office demanding an apology for the way
he had been treated when he had ‘only been carrying out my job.’ What had
appeared as deliberate damage to company property, had in fact merely been
an attempt to keep the production line running, a laudable intention indeed.
My most difficult task then became the need to placate the Plant Director, and
convince him that what he had observed was not a deliberate attempt to sabotage
or damage components, but merely an attempt to keep production running and
crudely rectify faulty parts. No easy task!
This event reinforced for me the essential requirement to approach even the
most apparently blatant and evident breach of contract cautiously, and not to
proceed without first investigating and verifying that the facts as observed, were
indeed correct, and what they seemed to be.
Whenever an issue arises that could lead to the possibility of disciplinary action,
the employer should make every effort to establish the facts before proceeding
to commence disciplinary action. If the issue is one of alleged misconduct, it is
important to act fast while memories of events remain clear. Any delay could
prejudice the fairness of any outcome. Notes of the investigation should be taken

at every stage, in order that they can be produced, if required, either during
the disciplinary proceedings, or at any subsequent tribunal hearing.
In minor cases such an investigation can be cursory. However, in more serious

cases a thorough investigation may be required, which may include suspending
the employee/s concerned on full pay and benefits, (unless the employee’s contract
of employment allows for suspension without pay or benefits) whilst the inves-
tigation is under way.
Only when the investigation has been completed with notes, and any other
records, which might, in serious cases, include statements from employees, being
kept for future reference, will it be possible to ascertain whether or not a breach
of contract has occurred requiring corrective disciplinary action on the part of
management.
It is very important that investigations do not reach any conclusion on the breach,
or alleged breach of contract. The investigator should merely assemble the facts,
not reach any conclusions based upon them ahead of any disciplinary hearing.
Most certainly no investigation will be complete until the employee concerned
has had every opportunity to put their side of the case. It is essential to remember
that the purpose of the investigation is to determine if a breach of contract has
occurred, and if so, what the appropriate corrective disciplinary action should
be. It is not a criminal investigation, unless a crime has been suspected, and in
such cases consideration must be given at an early stage as to whether, or when
the police should become involved.
The results of any investigation will determine whether to drop the matter
concerned, deal with it informally, or arrange for it to be dealt with formally. It
should be made clear to the employee at an early stage that the investigation
is not of itself disciplinary action, merely an assessment of the facts to deter-
mine whether a breach of contract has taken place that needs to be addressed
by the parties.
In cases other than misconduct, the gathering of facts is equally relevant. In cases
of either short-, or long-term absence, the facts will be the dates of the periods
of absence, together with any documentary evidence, such as sick notes, letters
etc that relate to the absences. In cases of poor performance, or lack of capability,
the evidence will consist of examples of the work complained of, any complaints
from customers, information on the training provided to the employee and any
other relevant matter.

Informal disciplinary action

Cases of minor misconduct or unsatisfactory performance are usually best dealt
with informally. A quiet word is often all that is required to improve an employee’s
conduct or performance. The informal approach is particularly helpful in small
firms where relationships are invariably closer and the speedy operation of a
formal procedure more likely to be misunderstood and counter productive.
Where, however, serious misconduct or performance is involved, or where the
informal approach has been tried and failed, then the use of the formal proce-
dure may be inevitable. A manager or supervisor would be well advised, even
with informal warnings, to make a diary note of any relevant conversations as
an ‘aide memoir’.
Formal disciplinary action

In accordance with the requirements of the Disputes Resolution Regulations,
the first step in the operation of any formal disciplinary procedure is to notify
the employee in writing, through what is known in the Regulations as a ‘One
Step statement’ (letter), about the matter concerning the employee, which has
led the employer to contemplate dismissing, or taking serious disciplinary action
against the employee.
This statement, or letter, should contain enough information for the employee
to be able to understand what the issue, or issues are, that are being addressed
by the letter, and the reasons why this is considered important enough to be
raised in writing. The letter should state that the matter will be considered formally
through meeting with the employee, and that the outcome of any meeting could
lead to disciplinary action being taken against them. The letter should also remind
the employee of their right to be accompanied at any disciplinary, or subsequent
appeal meeting, by another employee of their choice, or their trade union repre-
sentative.
If English is not the employee’s first language, the manager or employer should
take steps to ensure that the employee fully understands what is being said in
the letter, and should ask whether the employee requires assistance, in the form
of an interpreter being present at any disciplinary or appeal meeting, to ensure
that the employee is able to understand and follow the proceedings. The letter
should invite the employee to a meeting to discuss the issue/s and should include
the proposed date, venue and time of the meeting. Finally, the employee should

be provided with copies of any documentation that will be used during the meeting
when considering the issue/s concerned.
The Regulations state that the employer is expressly required, to ‘send a state-
ment to the employee’. However, there is no specific requirement to ensure that
the employee receives the statement. So if the statement is sent to the employee’s
correct address, but does not arrive, or gets lost in the post, the employer will,
theoretically, have complied with this requirement. However, compliance with
the literal wording of the Regulations will not lead to an automatic finding of
fair treatment. The employer is at all times required to act reasonably. If an
employer dismisses an employee for misconduct, without the employee having
first had an opportunity to rebut the allegations made against them, then any
disciplinary action that results will almost certainly be considered unfair, unless
the employer can demonstrate that they have made every effort to contact the
employee, and given them an opportunity to defend themselves against any allega-
tions being made.
If an employer sends a One Step statement to an employee who is absent through

sickness, the employer should, in the absence of a response from the employee,
attempt to make contact with the employee for a second time to check that the
employee has received the statement. As always, records should be kept of all
One Step statements or letters sent, and of all attempts to deliver them.
Invitations to a meeting
There is no requirement in the Regulations that the invitation to a meeting be
in writing. However, an employer who invites an employee to a meeting verbally
may have difficulty at a later stage if called upon to prove that such an invita-
tion was indeed issued. The sensible action would be to include any such invitation
in the initial letter advising the employee of the matter under consideration.
Finally, it is good practice in any letter inviting an employee to a disciplinary

meeting, to remind them of their right to be accompanied.

Provision of evidence
The amount and type of documentary information to be included with the One
Step letter is not clarified in either the Act, or the ACAS Code of Practice, however,
the employer must set out in writing the employee’s alleged conduct or other
circumstances which lead to him contemplating disciplining, or dismissing the
employee. It is likely that this information will amount, in a misconduct situa-
tion, to evidence that has emerged from the employer’s investigation into the
matter in question. The employee will need to be aware of any such evidence
in order to be able to explain his or her case. The grounds for including such
information, however, is not limited to misconduct cases. When the matter was
debated in the House of Lords, it was emphasised that although investigations
are usually associated only with misconduct cases, the government believed that
the gathering and prior disclosure of all relevant information was just as appro-
priate in any disciplinary or redundancy matter. Also, if the issue relates to lateness,
or frequent absence, it is advisable to include with the letter a summary of the
dates and times when absences or lateness occurred.
Where the investigation into an allegation of misconduct has led to the produc-
tion of witness statements from employees working in the immediate vicinity
of the employee concerned, thought needs to be given as to whether or not to
send such witness statements to the employee ahead of the meeting. Certainly
it would not be a good idea for the statements to include any names, or other
identification, enabling the employee to identify the employee/s concerned. Where
common sense prevents this, due to the content of the statements making it
inevitable that the identity of the employee/s concerned would be revealed simply
by reading the statements, I would recommend that a summary of the evidence,
drawn from the witness statements be written up and issued to the employee
concerned, to avoid any unpleasantness or friction developing in the workplace
ahead of the actual meeting. The employee and their representative can be
afforded additional time immediately preceding the disciplinary meeting, to peruse
the actual statements, and prepare questions for the witnesses concerned, if
required.
A failure to provide sufficient information to enable the employee to properly

prepare their defence to any allegations being made of a breach of contract,
will almost certainly render any subsequent disciplinary action or dismissal unfair.

The right to be accompanied

Employees have a statutory right to be accompanied by a fellow worker or a
trade union official, whenever they are required, or invited by their employer,
to attend at either a disciplinary, or grievance hearing. There is no requirement
for the trade union concerned to be recognised by the employer for bargaining
purposes for this right to be valid. A simple request by the employee for their
trade union representative to be in attendance at any meeting will suffice. A refusal
by an employer to allow such attendance, will be a breach of the statutory proce-
dural requirements, and could lead to a complaint on these grounds to an
employment tribunal.
The right to be accompanied will apply to any disciplinary meetings held as part
of the statutory disciplinary or dismissal procedures. This includes any meetings
that take place after the employee has left the employment of the employer. Informal
discussions, or counselling, do not qualify for the right to accompanied.
When an employee is choosing a companion it would not be reasonable to insist

on being accompanied by a colleague whose presence could prejudice the
proceedings in any way, or lead to a conflict of interest arising. Nor would it be
considered reasonable to ask to be accompanied by a colleague from a far distant
geographical location. The Regulations are clear that the companion may be:
• A fellow worker (from the employer’s workforce).
• An official employed by a trade union, or a lay trade union official, as

long as they have been certified in writing by the trade union
concerned, as having experience of, or having received training in,
acting as a workers’ representative at disciplinary or grievance
hearings. Certification may take the form of a letter, or card.
Fellow workers or trade union officials do not have to agree to any request to
accompany an employee at any disciplinary or grievance hearing and it would
be improper if pressure was exerted on them to attend.
Any worker who agrees to attend as a companion for another employee at either
a disciplinary or a grievance hearing is entitled to have a reasonable amount
of paid time off to fulfil that responsibility. This should cover not only the hearing,
but also time to understand the facts of the matter and to prepare for the actual
hearing.
Wherever possible the employer should allow the companion to have a say in
the timing and the date of the meeting. If the companion cannot attend on the

proposed date, an alternative time can be suggested, as long as it is not longer

than five days after the original date chosen by the employer.
Care should be taken to cater for the special circumstances that could arise if
either the employee concerned, or their companion, was disabled in any way.
It could be that they will require assistance, which may involve another person
helping them, if the meeting is to be considered fair.
Before any hearing the employee should tell their employer who they have chosen
to accompany them. The companion should be allowed to address the hearing
in order to:
• Put the employee’s case;
• Sum up the employee’s case;
• Respond on the employee’s behalf to any view expressed at the hearing.
They may also confer with the employee during the meeting and ask questions
of any witness who is in attendance at the meeting. They should not, however,
answer any question put to the employee, on the employee’s behalf. Nor should
they prevent the employee from putting their own case to the meeting.
Employees whose employers fail to comply with a reasonable request to be accom-

panied at a hearing may present a complaint on these grounds to an Employment
Tribunal. Employees may also complain if the employer fails to rearrange a
meeting if the chosen companion is unable to make the original hearing date.
Where a tribunal finds these facts proven it may award compensation of up to
two weeks’ pay and this could be increased if the tribunal also finds that the
employee was unfairly dismissed.
The disciplinary meeting

Schedule 2 of Part 1 of the 2002 Employment Act states that:
• A meeting must take place before any disciplinary action takes place
and
• The meeting must not take place unless:

– The employer has informed the employee what the basis was for
including in the Statement under Step 1, the ground or grounds
given in it, and
– The employee has had a reasonable opportunity to consider his

or her response to that information.

• The employee must take all reasonable steps to attend the meeting, and
• After the meeting, the employer must inform the employee of (sic) his
decision and notify the employee of the right to appeal against the
decision if he or she is not satisfied with it.
Wherever possible the timing and location of the meeting should be agreed in
advance with the employee. The length of time between the written notifica-
tion and the meeting taking place should be long enough to allow the employee
to prepare for the meeting. But not so long that memories fade. The meeting
should be held in a private location and steps should be taken to ensure that
the meeting can proceed without interruption.
Prior to any meeting taking place, the employee must be given a reasonable oppor-
tunity to consider his or her responses to the information contained in the One
Step statement. The concept of reasonableness is written throughout the statu-
tory procedures. There is no definition in the Regulations as to what would be
considered a reasonable period to consider the facts given to an employee in a
One Step statement. However it can be assumed that a period of between two
and three days as a minimum would be required to meet this requirement in a
case of simple misconduct or absence from work. The complexity of the circum-
stances involved in each case of potential disciplinary action should be used by
employers as an indicator of what would be considered a reasonable period of
time in any particular disciplinary case.
The DDP states that the employee must take all reasonable steps to attend the
Two Step meeting. Normally the employer will invite the employee to attend
such a meeting during working hours. Where an employee falls ill, or is prevented
from attending on other valid grounds, the employer should offer the employee
an alternative meeting date. A decision may be taken in the employee’s absence
if they fail to attend the rearranged meeting without good cause.
One factor which could influence the timing of any meeting is the availability
of the employee’s chosen companion, or their trade union representative, to attend
the meeting on a specific date and time. If the companion cannot attend on a
proposed date, the employer can suggest an alternative time and date, so long
as it is reasonable, and is not more than five days after the original date chosen
for the meeting.
At the meeting the employer should outline the complaint against the employee
and go through any evidence that has been gathered in support of the allega-
tion. The employee should be allowed to set out their case and answer any
allegations that have been made against them. The employee should also be
allowed to ask questions as the proceedings develop, present any evidence they

may wish to present to the meeting, call witnesses of their own, and be given
the opportunity to raise points against any information provided by witnesses.
During the meeting the employer should take note of the proceedings (or arrange
for someone to take notes on their behalf). These notes can be written up after
the meeting has ended and agreed wherever possible with the employee. Where
agreement is not possible, then any difference of recollection should be
recorded.
At the conclusion of the meeting the employer must decide what action if any
should be taken in regard to the matters that have been the subject of the meeting.
The possible outcomes of a disciplinary meeting are:
1. Further information required and meeting adjourned to enable such

information to be gathered.
2. No breach of contract has occurred and no further action required
3. Training needs identified and agreed.
4. A minor breach of contract has occurred and corrective action is

required.
5. A serious breach of contract has been identified and serious action,

possibly the termination of the contract of employment is the
appropriate action to take.
Handling disciplinary meetings

All too often in business and commerce managers are promoted, or appointed
to their positions because of their technical or specialist knowledge. There seems
to be a wholly unfounded belief that because a manager is good technically, that
he or she will automatically be a good manager of people. Yet the effective
management of people is a skill; very few people have a natural talent in this
essential area of business. Good managers are leaders who possess, or have
learned, the essential skills necessary for directing and enthusing their staff with
the attitudes necessary to achieve peak performance, and attain departmental
objectives.
The same assumptions that lead to the appointment of managers without first
providing them with the necessary training to ensure that they understand, and
are able, to carry out their new roles effectively also occurs when it comes to
holding or conducting disciplinary or grievance meetings. Managers who are

charged with the responsibility of conducting these hearings must understand

the essential requirements for carrying out these most exacting and important
tasks. This can only properly be done by providing training in this aspect of
management.
Managers should be trained to enable them to:
• Be familiar with every aspect of their business’ rules, disciplinary and

grievance procedures.
• Approach the task of running a disciplinary or grievance hearing

meeting with an open mind free of any prior misconceptions or bias.
• Ensure that all of the steps that must be taken prior to any hearing
are properly followed, such as the One Step letters, or statements being
sent in the case of a disciplinary hearing, or received in the case of a
grievance hearing. These, together with essential supporting evidence
or documentation being sent to, or received from, the employee/s
concerned in good time to enable proper preparation for the meeting.
• Ensure that the employee has been advised of their right to be repre-
sented by an employee, or trade union representative of their choice.
• Be assisted by a colleague whose job will be to handle the administrative

tasks associated with any meeting of a disciplinary or grievance nature,
such as note taking, liaising with the employee and his or her
representative, dealing with minor administrative matters as they arise,
circulating and agreeing the record of the meeting etc.
• Arrange for a meeting venue where the matters in questions can be

dealt with in privacy and without interruption. Wherever possible a
side room or alternative venue should be available to accommodate
adjournments.
• Open any meeting by ensuring that all of the matters under point 3
above have been carried out to the employee’s satisfaction.
• Agree the agenda for the meeting with the employee and his/her
representative.
• Ensure that the representative understands the role they are to play
in the meeting and are happy with the format and structure of the
meeting.
• Open the formal part of the meeting by setting out its purpose and
outlining the management reasons for calling, or agreeing to the
meeting, and in disciplinary hearings, go on to introduce the relevant

information and any evidence that management has gathered together

before calling the meeting. In grievance meetings refer to the contents
of the One Step letter and invite the employee to expand on their reasons
for seeking a meeting with management to discuss the issue in question.
• Invite the employee (and representative) to put their side of the matter,
and assist them in questioning, or expanding on the evidence available
to the meeting, and allow them to raise any points with which they
have concern, or wish to bring to management’s attention.
• Allow for adjournments to occur where additional information is

required, or there is clearly a need to enable the employee and his/her
representative to consider their position. The length of each
adjournment being appropriate to its need.
• Conclude any disciplinary meeting by either confirming that no breach

of contract has occurred, thanking the employee and representative
for their attendance at the meeting, or, sum up the facts as they find
them which lead them to believe that a breach of contract has occurred
which requires remedial action.
• Conclude any grievance meeting by agreeing with the employee the

action/s that will be taken to resolve the grievance/s, or set out the
reasons why they believe that no further action is required from
management to deal with the matter/s raised.
• Adjourn the meeting, before deciding on any disciplinary action

necessary to deal effectively with any specific identified breaches of
contract that may have occurred, bearing in mind the principal of taking
remedial, not punitive action wherever possible.
• Announce any decision/s that have been reached, and remind the
employee of their right of appeal if they disagree with the meeting’s
findings.
• Agree the notes with the person charged with the task of drafting these,
ensuring that the employee and his/her representative have the
opportunity to comment on them before their final production.
Where agreement is not possible arrange for the employee’s version
of events to be recorded separately.
• Write to the employee concerned, with a copy to the representative

where appropriate, setting out their findings and any further action
that will be taken on either the disciplinary, or grievance matter/s
discussed at the meeting. This letter should remind the employee of
their right of appeal.

Records of disciplinary meetings

Reference has been made throughout to the importance of record taking during
all formal meetings with employees. The aim of management should be to create
what auditors call a ‘paper trail’. This ‘paper trail’ will enable any subsequent
review, or Employment Tribunal hearing to follow the proceedings that took
place, simply by reviewing the minutes and records of the meetings, together
with any associated documentation.
Employers should keep written records of all disciplinary meetings (not

verbatim however). These records should be agreed, wherever possible and
shared with the employee. Where agreement is not possible, the employee’s recol-
lection of events should be recorded separately from the employer’s record and
retained for future reference.
Note: These records should include as a minimum:
1. The complaint against the employee;
2. The employee’s defence;
3. Findings made and actions taken;
4. The reasons for actions taken;
5. Whether an appeal was lodged;
6. The outcome of the appeal;
7. Any grievances raised during the disciplinary procedure; and
8. Subsequent developments;
9. All records should be treated as confidential under the Data Protection

Act 1998.
The importance of good clear records cannot be under stated. At any subse-
quent Employment Tribunal these documents can be ‘worth their weight in gold’.
Verbal testimony has value when given by competent and confident witnesses,
but it can be challenged and shaken by good cross examination. But when such
testimony is validated by supporting agreed documentation, the testimony of
even a weak witness is strengthened immeasurably, and the value of cross exami-
nation subsequently diminished.

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 6
Disciplinary sanctions
Disciplinary sanctions and warnings ................................................58
Poor performance issues – capability................................................60
Sickness, lateness and absence ..........................................................60
Misconduct and gross misconduct....................................................63

Chapter 6
Disciplinary sanctions
Disciplinary sanctions and warnings

Disciplinary sanctions should be designed to remedy any identified significant
breach of contract. Their purpose is to draw to the attention of employees areas
of their performance which may be unsatisfactory, or which may fall short of
the standards agreed at the commencement of their contract, and to give every
help and opportunity to enable employees to improve to the standards required.
The perfect employee, like the perfect person, has not yet been born (religious
icons excluded!). People are fallible and prone to make mistakes and errors of
judgment from time to time. Managers as ‘enablers’ should always be working
to assist employees to raise their levels of performance through encouragement,
training and example.
When disciplinary action is unavoidable, the normal sequence of sanctions is:
• First offence – verbal warning
• Repeat offence –or more serious offence – written warning
• Repeat offence, or very serious breach of rules – final written warning
• Repeat offence, or extremely serious breach of rules – dismissal with

notice (or pay in lieu)
• Gross misconduct – dismissal without notice (only after suspension

and investigation).
The purpose of any disciplinary procedure is correction, not punishment. Thus

regard should be given, when a breach of contract is proven, to the appropriate
level of disciplinary action required to correct the breach. It may be a case of
simply drawing the matter to the attention of the employee, and asking them
to change their offending behaviour. This is the purpose of the lower levels of
disciplinary sanction such as the verbal, or first written warning. More serious
action may be called for, however, and this is the purpose of the second, or final
written warning.

6 D I S C I P L I N A RY S A N C T I O N S
A final written warning should be just that. It is one step away from dismissal.
It is saying effectively that this is the last chance for the employee to work to
the standards laid down by the contract of employment. They are, to coin a phrase
‘Drinking in the Last Chance Saloon.’ Managers should avoid any ambiguity
when writing these. Phrases such as ‘Your employment may be terminated’ must
be avoided. The letter must state clearly and unambiguously that the employ-
ment will end if the breach, or a similar breach reoccurs.
Where the breach is persistent, or very serious, then the ultimate step of ending
the contract may be the only route left open to the employer. When such action
is required, the employer is recognising the reality that the contract cannot
continue. That the employee’s performance – or non-performance is such that
there is no alternative but to end the contract of employment and seek a fresh
recruit to carry out the work for which the dismissed employee was engaged.
In such cases the contract will end by the employer giving the requisite notice
to the employee, unless the dismissal is on the grounds of Gross Misconduct.
Gross Misconduct dismissals are without notice, or pay in lieu of notice.
Warnings do not remain live for ever. It is important they should be erased after
time, although evidence of the warning can remain in an employee’s personnel
file. The recommended life of a warning depends on its severity but as a broad
guide:
• Verbal warning – three months.
• 1st Written warning – six months.
• 2nd or final written warning – 12 months minimum.
Certain organizations also allow for demotion or reduction in pay and benefits
as an alternative to dismissal, but these can only be invoked where the contract
of employment allows for this, and the employee agrees. To impose a change
in any fundamental term of an employee’s term of employment, without their
prior agreement, is to risk a successful claim of unfair ‘constructive dismissal’.
The sequence of warnings does not have to be followed like ‘steps in a ladder’.
The severity of the breach will indicate the level of disciplinary sanction needed
to rectify it. The objective is always to get the employee back within the frame-
work of the contract of employment, operating as required by its terms.

Poor performance issues – capability

Where warnings are issued to an employee designed to rectify poor perform-
ance, these should clearly set out the standard of performance that is required,
together with any training or assistance that will be provided to them to enable
them to reach the required performance standard. It is good practice to include
a date when the employee’s performance will be reviewed again, to determine
if the required standard has been reached. This will not preclude the possibility
of further disciplinary action taking place if the desired level of performance is
not achieved earlier. Finally, the name of a supervisor or other employee to whom
the employee concerned can refer if they require any help or assistance in the
interim between meeting and review, should be included, with the supervisor,
or named employee, being copied in and notified accordingly.
Sickness, lateness and absence

Capability issues, such as frequent sickness absence, regular lateness for work
and other unscheduled absences, are capable of a report on their own merits
(see Employee sickness and fitness for work by Gillian Howard published by Thoro-
good). They are radically different from dealing with other capability issues.
However, any absence from work that has not been subject to prior agreement,
is ‘de facto’, a breach of contract.
Holidays are an agreed absence from work. They are part of the contract terms
and are almost always agreed in advance. Sickness, lateness and other
absences, however, are not. In their initial form they are a breach of contract
that is subsequently approved through the provision of satisfactory supporting
information, or evidence being given to the employer by the employee. Until
approval has been given, they remain a breach of contract.
All properly drafted statements of terms and particulars of employment will

include a section dealing with absence through illness or other reason. These
will require notification by employees of the reason for their absence, normally
on the first morning, or period of absence; followed up thereafter in the case
of sickness, with supporting documentation – either in the form of a self certifi-
cate, or a doctor’s note that validates the sickness.
Issuing a disciplinary warning to employees who have been, or are, absent

through sickness, can seem inappropriate. There is something faintly ludicrous
in warning an employee not to be sick again, or sick as frequently, particularly
when the sickness is genuine, and not merely a case of malingering. However,

this is not to say that the issue of absence through ‘sickness’ is not a serious
issue. In certain public employing organizations, sickness absence has reached
almost epidemic proportions – up to an average of five weeks a year in some
reported instances in 2005. This means, when added to 20 statutory days holiday
plus seven bank or public holidays, that employees in these organizations are
absent for over ten weeks a year – almost 20% of the working year! A serious
and expensive management problem indeed.
The only way that management can proceed in such circumstance is by

demanding clear medical evidence of sickness absences, before taking further
action. Frequently absent employees should be interviewed on the circumstances
relating to their absence by their manager or supervisor upon their return to
work – on every occasion.
Where employees are in the habit of providing self certification to cover frequent
short-term absences, employers should demand that these be replaced by doctor’s
sickness certificates, even if the employer covers the cost of these. Only by rigor-
ously checking, and following up each absence, will lasting change be achieved.
There are no short cuts to achieving the change in culture necessary to force
absence down where it has become an established part of the culture of any
organization.
Before taking serious disciplinary action against employees who are frequently
absent from work, employers would be well advised to:
• Investigate the facts, review the attendance record of the employee

concerned, and the reasons given for the absences. Consider the pattern
of the absences, to see whether they fall into any pattern that would
give indication of any reason, other than sickness, for the absences.
• Consider the employee’s explanations for the absences, by interviewing

them, and showing them evidence of their attendance record. Listen
to their explanations.
• Warn the employee under the disciplinary procedure that their level
of absenteeism is unacceptable; that they must improve, explaining
the time limit within which this must be done if more serious
disciplinary action is not to follow.
• Consider, and apply the appropriate penalty.
• Continue to monitor the employee’s attendance record.
If the absences continue, and the contract of employment allows for it, (the inclu-
sion of such a clause into a contract of employment is to be strongly recommended)

the employee should be medically examined by a doctor selected for this purpose,
and paid for by the employer. The doctor should be sent full details of the
employee’s absences, together with copies of any documentation that they have
provided in support of these. The doctor should be provided with information
on the nature of the employee’s job, and be asked to examine the employee to
determine if the pattern of absences that have been demonstrated in the past,
are likely to continue, and if so, if there is any action that the employer can take
to help the employee to improve their attendance record. Seeking medical infor-
mation about employees must be handled with extreme care and sensitivity. Where
the employee is of the opposite sex from the manager concerned in the investi-
gation, every effort must be made to ‘tread carefully’ when seeking medical
information. All medical information obtained regarding an employee must be
treated in the utmost confidence.
Where information is sought from the employee’s own doctor, the requirements
of the Medical Reports Act 1988 must be met. This gives the employee the right
to see, comment on and, where considered necessary, amend the report, before
it is passed to the employer. These provisions, however, do not apply when the
employer nominates, and pays for, a doctor to conduct the required medical
examination.
The report that the employer receives back from the doctor should enable them
to identify any underlying medical problem that the employee may have which
is causing their absences, and enable the employee and the employer to agree
on a course of action to manage this in the future – perhaps the employee can
move to part-time working, or their duties be changed such as to minimize the
impact of any absences they may have in the future on the efficiency and effec-
tiveness of the organization.
The doctor’s report should:
• Identify that the employee suffers from a medical condition that gives
the employer no option but to terminate the employee’s contract of
employment. In all such cases the employee must be given every
opportunity to challenge the report’s findings before their employment
is terminated. To do so, however, they must, by the very nature of their
challenge, move to a position where their attendance at work is
improved, or
• State the good news that the employee has no underlying health
problem that the employer must take into account. This means that
the employee should be in regular attendance at work in the future.

Where an employee refuses to undergo a medical examination, they should be

told by their employer that, as a result of their refusal, the employer will be unable
to take account of any medical condition they may suffer from when consid-
ering future absences. All such absences will be viewed simply as breaches of
the contractual requirement that they attend for work regularly; a failure to comply
with these basic contract terms will lead to warnings and ultimately dismissal.
They should be advised of this fact in writing and given the opportunity to appeal
against it should they so desire. The aim of the employer here should always
be to obtain precise facts on which any decision regarding the employee’s future
absences can be considered. If the employer is denied access to the informa-
tion necessary, through the employee’s refusal to cooperate in the collection of
the required information, then the employer should not, as a result, be impeded
from reaching a decision on the facts that are available to them.
Long-term sickness absence is another matter entirely and whilst similar in the
course of action that must be followed when considering possible dismissal, it
must be handled in a manner set out later in this Report.
Misconduct and gross misconduct

The definition of misconduct is any action, under the employee’s direct control,
that is a breach of the employing organization’s rules and operating procedures.
Where an employee has misconducted him/herself then action is required
(through the disciplinary procedure) on the part of the employer to point out
why the conduct complained of is unacceptable, with a request that the employee
does not repeat the behaviour which has already been complained about:
The rules and operating procedures will lay down the standards of perform-
ance and behaviour required of employees in order to properly carry out their
duties and fulfil their obligations to their employer.
Rules such as those listed in Chapter 2 viz:
• Unsatisfactory work performance
• Harassment, victimisation or bullying
• Misuse of company facilities (such as e-mail, internet, vehicles and other

equipment etc)
• Poor timekeeping
• Unauthorised absence

• Failure to follow instructions
• Failure to observe safety rules
• Misconduct – which can cover a wide definition
• Gross Misconduct
• A ‘catch all clause’ stating that any given list is not exhaustive
• Health and safety matters.
These are all issues where a failure to comply will lead to disciplinary action
depending on the severity of the breach. They are clearly distinguishable from
Gross Misconduct which is action so serious as to enable the employer to conclude
that the action complained of has destroyed the contract of employment; such
as when the employee absconds with money from the till, or assaults another
employee. In such cases when the employer is satisfied that what he believes
has happened, has in fact happened, then the contract is over. It has been ended
by the actions of the employee. There is no doubt in the matter. The fundamental
basis of ‘trust and confidence’ required for the proper continuation of any contract
has been irredeemably destroyed by the employee’s actions, or lack of them.
Acts such as:
• Fighting or drunkenness
• Illegal drug taking and alcohol use during working hours – (or outside
if driving or flying is involved)
• Theft or fraud
• Physical violence or extreme bullying
• Deliberate and serious damage to property
• Serious insubordination
• Unlawful discrimination or harassment
• Bringing the organization into serious disrepute
• Serious negligence
• A serious breach of health and safety rules
• A fundamental breach of trust and confidence.
All fall into this category.
However, the burden of proof always remains with the employer in every instance
of misconduct, or gross misconduct, to establish justification for any discipli-

nary action that they may have taken. The burden is not as onerous as that required
by a court of law, which is defined as ‘beyond reasonable doubt’, but none the
less it is action such as no employer would reach without first carrying out a
full and proper investigation to establish the facts.
Over time the Employment Tribunal system has established the tests that
employers can be expected to meet if they wish to satisfy the requirements neces-
sary to establish a ‘fair’, as opposed to an ‘unfair’ dismissal. These tests are
appropriate guides when dealing with any matter that falls under the heading
of either ‘Misconduct’ or ’Gross Misconduct’.
The leading case over the years concerning misconduct has been British Home
Stores v Burchell (1978 EAT).
This was a case of Unfair Dismissal on the grounds of misconduct which focused
on the reasonableness of the dismissal. This case established the steps that an
employer must follow if a misconduct dismissal is to be found ‘fair’.
The employer must:
• Entertain a reasonable belief in the guilt of the employee
• Establish the fact of the belief and the fact that they did believe it
• Have reasonable grounds on which to sustain the belief
• Demonstrate that they had carried out as much investigation into the
matter as was reasonable in all of the circumstances
Although the tests set out in British Home Stores Ltd v Burchell are a useful guide
in assessing the reasonableness of conduct dismissals, a simplistic application
of the test in each and every conduct case may lead to errors occurring. In applying
the test, tribunals are advised to bear in mind that an investigation may not be
appropriate, or required in cases where the employee has admitted to the miscon-
duct in question; and that, even where the dismissal fails one or more parts of
the test, it is still necessary for any tribunal to consider whether the dismissal
came within the band of reasonable responses open to the employer.
Whilst ‘Burchell’ concerns dismissal, the tests it sets are appropriate to any case
of serious misconduct, whether or not the outcome is the dismissal of the employee
in question, and it serves to act as a yardstick when considering any issue of
alleged misconduct.

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 7
Ending employment
How employment can end..................................................................67
Resignation...........................................................................................67
Termination by mutual agreement.....................................................69
Compromise agreements....................................................................70
Requirements of a compromise agreement......................................71
Independence of adviser.....................................................................72
The conclusion of a fixed term contract............................................73
Dismissals with notice and summary dismissals .............................73
Capability dismissals ..........................................................................78
Skill and aptitude .................................................................................78
Ill health dismissals..............................................................................79
Qualification dismissals.......................................................................81
Conduct dismissals..............................................................................82
Redundancy dismissals ......................................................................83

Chapter 7
Ending employment
How employment can end

Employment can end through:
• Resignation
• Termination by mutual agreement
• The conclusion of a fixed term contract
• Dismissal with notice or summary dismissal
• Redundancy
• Contravention of a statutory duty
• Some Other Substantial Reason (SOSR)
• Frustration
Resignation
The general principle to be observed here is that either party can give notice
to the other to terminate the contract of employment and that once notice has
been given it cannot be unilaterally withdrawn.
The length of notice can be agreed between the parties but must not be less than
that allowed for by statute, which is:
• not less than one week’s notice if the period of continuous service is
less than two years, but over one month.
• not less than one week’s notice for each year of continual employment
of two years or more, to a maximum of 12 weeks notice after 12 years
continuous service.
The statutory notice period must be paid by employers when ending employ-
ment irrespective of the employee’s circumstances. Employers often find it
difficult to grasp that when they end the employment of an employee who has

7 ENDING EMPLOYMENT
been absent from work on the grounds of sickness for a lengthy period, so lengthy
that they have long since ceased to be entitled to any pay from their employer,
that the employee must still be paid their full notice entitlement when their employ-
ment is ended by the employer.
The minimum statutory notice provision does not prevent either party from
waiving the right to notice, or effect the right of either party to terminate the
contract without notice in response to a serious breach of contract by the other,
or prevent the employee accepting payment in lieu of notice.
If notice (other than the statutory minimum) has not been expressly agreed
between the parties to the contract, then the law requires that ‘reasonable notice’
be given, with the length of the notice being dependant upon factors such as
seniority, status, length of service etc. None of this should detract from the require-
ment to provide, as a minimum platform, the statutory notice as set out above.
Employers must avoid accepting ambiguous resignations where words are used
in the ‘heat of the moment’ that could be interpreted as a resignation on the
part of an employee. Where employees give verbal notice and provide nothing
to their employer in writing, then the employer should create their own evidence
by writing to the employee and confirming their acceptance of the verbally given
notice. In this way, written documentation will exist if at a later stage the employee
claims they were dismissed and did not resign, or intend to resign. The test applied
by tribunals here is what an objective reasonable listener, taking all the facts
and circumstances into account, would have concluded from the words used.
Where an employee resigns in ’the heat of the moment’, a tribunal or court would
expect the employer to have subsequently made ‘reasonable investigations’ to
establish if the employee really meant to resign, or was simply letting off steam.
The employer in these circumstances would be expected to give the employee
an opportunity to clarify the situation and confirm their intentions.
Problems can arise when employees do not want to work their notice periods,
however short. Either party can waive the notice period; though an employer
faced with such an option would be well advised to insist on a written request
to waive the notice period before agreeing to grant it. Where employees simply
walk away without working their notice period they are in breach of contract.
Technically an employer would be entitled to take legal action to recover any
costs incurred by them in plugging the gap in their operation caused by such
behaviour. Usually, however, it is not worth the time and legal costs that would
be incurred by following such a course of action.

7 ENDING EMPLOYMENT
One step that can be taken to minimize the cost of such a refusal to work notice,
is to write into all contracts of employment the right of the employer to deduct
from any outstanding holiday pay that may be owed to the employee, an amount
equivalent to the period of notice not worked by the departing employee. Provided
that this right was clearly set out in the contract, then the employer would not
be in breach of the Wages Act, which makes deductions from pay unlawful, unless
agreed in writing between the parties.
Where the notice period set out in the contract is lengthy, it is very often diffi-
cult to force an employee to work their period when they have made up their
mind to leave. It is not unusual for periods of three to six months to be the norm
in directors’ or senior employees’ service contracts. The reasoning behind
providing such lengthy periods of notice is that they give comfort to valuable
employees in the event of termination, that they will have a reasonable finan-
cial cushion available to provide for them whilst they seek alternative
employment. On the employer’s part the attraction can be that a senior
employer cannot simply give a short period of notice to end the contract and
walk into a similar position with a competitor. Whilst this risk can be guarded
against through the drafting of specific restrictive covenants to protect the
employer’s business, there is no guarantee that such covenants will be upheld
by the courts if tested. In all too many cases long periods of notice result in either
the employee receiving a lump sum payment in lieu of notice, or alternatively,
where the employer believes that the employee intends to join a competitor, the
operation of ‘garden leave’. Under this term the employee remains at home during
the notice period available to their employer if required. In this way the employee
is theoretically prevented from working for any other business.
Termination by mutual agreement

As contracts are entered into through mutual agreement, so they can be similarly
ended.
The circumstances in which a contract can be said to have ended by ‘mutual

agreement’ will turn on the facts of the termination of employment. Over the
years the courts have examined many such cases and each has turned on its
own merits. In one case (Igbo v Johnson Matthey Chemical Ltd 1986) an employee
sought extended leave to visit her husband and children overseas. Her
employers agreed, but stipulated that if she did not return by a specific agreed
date her contract of employment would be automatically terminated. This was
put in writing and agreed by both parties. The employee did return to this country

7 ENDING EMPLOYMENT
prior to the date agreed, but was too sick to report for work on the due date.
The employer terminated the employment on the terms previously agreed. The
employee complained that she had been dismissed and the courts found in her
favour, stating that the reason for the employee’s failure to return to work was
not the extended leave, but sickness, an event which could have occurred at any
time under the terms of the contract.
There may be circumstances where both parties are aware that the contract is
not working to the satisfaction of either. It is always open to them to seek a
mutually satisfactory resolution. This can include the termination of the contract
on terms agreeable to both parties. The law provides for this through what are
known as ‘compromise agreements’.
Compromise agreements
This type of agreement is provided for by the Employment Relations Act 1999,
and is useful when the parties have already reached agreement, or where one
of the parties refuses to reach a settlement without further legal assistance or
advice. There may indeed be no ongoing disagreement, but the parties, having
reached an agreement, wish it to be set out in legal form. A compromise agree-
ment can resolve issues in a legally binding document that a tribunal has
jurisdiction to rule on.
Compromise agreements are legally binding agreements which set out the terms
on which a settlement surrounding the termination of a contract of employment
has been reached between an employer and an employee. Their main purpose
is to resolve disputes that an Employment Tribunal would otherwise have juris-
diction to determine. In this regard they serve two basic purposes:
• They are provided specifically to encourage the parties to reach a

binding resolution of a dispute without recourse to law.
• They are a means of finalising matters; once a compromise agreement

has been entered into, the parties to it are thereafter prevented from
taking any further legal action on the specific matters covered by the
compromise agreement.
Employment Tribunals cannot consider a claim that has been settled by means
of a properly constituted compromise agreement. However, this applies only
to the types of compromise agreement that meet the criteria set out below. Parlia-
ment, through employment law, gives employees protection whilst in
employment, including the right to enforce their rights at an Employment

7 ENDING EMPLOYMENT
Tribunal. Employers are not able to buy this right from employees, nor are
employees entitled to sell it, therefore any agreement that purported to do so
would be unenforceable unless it was in the form of a compromise agreement
i.e. the method laid down by parliament.
An employer and employee can only reach an agreement to exclude a worker

going to an Employment Tribunal in two ways:
• By a COT3 settlement brokered by ACAS
• By a valid compromise agreement.
All other forms of agreement are invalid if they seek to preclude the employee
from pursuing a claim at Employment Tribunal.
A compromise agreement might be useful in the following circumstances:
• An employee claiming racial discrimination is prepared to accept an

apology and a payment rather than go to law.
• Where two companies merge requiring only one sales director. As a

result one of the sales directors agrees to leave with an enhanced
redundancy payment.
• An employee resigns because of incompatibility with their supervisor.

The employer agrees to make a cash settlement rather than face a
possible claim in the Employment Tribunal.
In each case the employer wishes to ensure that the matter is settled perma-
nently and therefore a subsequent claim to an Employment Tribunal cannot arise.
Requirements of a compromise agreement

To comply with the law a compromise agreement must meet the following
requirements:
• The agreement must be set out in writing.
• It must relate to one possible set of tribunal proceedings. It can, however,

cover any issue raised in that complaint as long as they are matters
over which the tribunal has jurisdiction.
Before signing a compromise agreement, an employee must have been advised

by an independent qualified person about the content of the agreement and its
full effects, in fact the agreement must state that this has happened, naming the
adviser involved. In particular, the employee must be advised of the effect of

7 ENDING EMPLOYMENT
the agreement on their right to pursue the relevant matter at any subsequent
Employment Tribunal. A qualified person may be:
• A solicitor or barrister or authorised advocate;
• A trade union official, certified in writing by the union as being

competent to give advice;
• An advice centre worker who is appropriately certified and authorised

by the centre.
Note ‘authorised’ means a fellow of the Institute of Legal Executives, so long

as they are employed by a solicitors’ practice and supervised by a solicitor when
giving advice.
The following aspects of any agreement are also essential:
• The adviser must be named in the agreement.
• The adviser must be adequately insured against giving improper advice.
• The agreement must state that all the conditions imposed by statute
have been met.
Independence of adviser
Any named adviser must clearly be independent. This means that a solicitor who
is acting for both parties may not be used, nor may the employer’s solicitor. It
can also be argued that a solicitor drawing up a compromise agreement for an
employee is not acting independently if their fee is to be paid by the employer,
although payment made by the employer, or an agreement to cover an agreed
sum, is not unusual.
Employers must be careful to ensure that nothing said during ‘negotiations’

covering the ending of an employment contract can come back to haunt them.
Matters are all well and good where the employee accepts the proposed agree-
ment, but the situation can arise where he or she listens to what the employer
has to say, and then decides against taking up the offer. The employer may by
then have said a number of things about the employee’s future with the organ-
ization – or lack of it – that they wish had not been said. It is sensible therefore
to ensure that all discussions regarding the possibility of entering into a compro-
mise agreement be conducted on a ‘no prejudice’ basis. This should ensure that
any comments or proposals made will not subsequently be used against the
employer. There are some exceptions to this rule, however, and an employer

7 ENDING EMPLOYMENT
concerned about this should first seek advice from a qualified employment adviser
before proceeding.
The conclusion of a fixed term contract

A ‘fixed term employee’ is one who works under a fixed term contract. i.e. an
employment contract which will terminate:
• On the expiry of a specific term; or
• On the completion of a particular task; or
• On the occurrence or non-occurrence of any specific event other than

the attainment by the employee of any normal and bona fide retiring
age in the establishment for an employee holding the position held
by the employee.
For the purposes of unfair dismissal and redundancy law an employee is dismissed
if he or she is employed under a contract for a fixed term and that term expires
without being renewed. Such an employee can therefore bring a complaint of
unfair dismissal or claim redundancy in the same way as a permanent employee.
All ‘fixed term employees’ are given the same protection at the end of their
contracts as permanent employees and should be treated as such.
Dismissals with notice and summary dismissals

The Employment Rights Act 1996 defines dismissal:
1. For the purposes of this Part (of the Act) an employee is dismissed by
his (sic) employer if (and subject to sub section (2) and section 96, only
if):
• the contract under which he is employed is terminated by the

employer (whether with or without notice),
• he is employed under a limited term contract and that contract

terminates by virtue of the limiting event without being renewed
under the same contract, or
• the employee terminates the contract under which he is employed

(with or without notice) in circumstances in which he is entitled
to terminate it without notice by reason of the employer’s conduct.

7 ENDING EMPLOYMENT
2. An employee shall be taken to be dismissed by his employer for the

purposes of this Part if:
• the employer gives notice to the employee to terminate his

contract of employment, and
• at a time within the period of that notice the employee gives notice
to the employer to terminate the contract of employment on a date
earlier than the date on which the employer notice is due to expire;
and the reason for the dismissal is to be taken to be the reason for which
the employer’s notice is given.
Certain employees are disqualified from the right to claim unfair

dismissal
These are:
• Workers who fail to satisfy the status of ‘employee’ (as set out in
Chapter 2).
• Employees who have not worked for a continuous period of one

year.
• Share fishermen.
• The police and prison officers and members of the armed forces.
• Certain crown employees.
• Employees reaching retirement age: to claim, employees must not

have passed the ‘normal retiring age’ for employees in their
position; or where there is no normal retiring age, must not have
passed their 65th birthday.
• Workers who at the time of their dismissal are taking industrial

action which has lasted more than eight weeks and where there
has been no selective dismissal or engagement of those taking
the action.
• Those employees covered by a disciplinary procedure voluntarily

agreed between employers and an independent trade union, where
the Secretary of State has designated it to apply instead of the
Statutory Scheme.

7 ENDING EMPLOYMENT
• Illegal contracts of employment entered into to do an act which

is unlawful are, as a result of their illegality, unenforceable.
• Where a settlement of the claim has been agreed with the

involvement of an ACAS Conciliation Officer and the employee
has agreed to withdraw his/her complaint through entering into
a valid compromise agreement.
The Employment Rights Act 1996 s.136 (1)(a) states that:
An employee shall be treated as dismissed by his employer if, but only if:
• the contract under which he is employed by the employer is terminated

by the employer, whether it is terminated by notice or without notice.
In determining the fairness or otherwise of a dismissal we must again refer to

the Employment Rights Act 1996 Section 98 (1) which states that:
1. In determining for the purposes of this Part whether the dismissal of

an employee is fair or unfair, it is for the employer to show:
• the reason (or if more than one, the principle reason) for the
dismissal, and
• that it is either a reason falling with subsection (2) or some other

substantial reason of a kind such as to justify the dismissal of an
employee holding the position which the employee held.
2. A reason falls within this subsection if it:
• relates to the capability or qualifications of the employee for

performing work of the kind which he was employed by the
employer to do,
• relates to the conduct of the employee,
• is that the employee was redundant, or
• that the employee could not continue to work in the position without
contravention (either on his part or that of his employer) of a duty
or restriction imposed by or under an enactment.
3. In subsection(2)(a):
• ‘capability’, in relation to an employee, means his capability assessed

by reference to skill, aptitude, health or any other physical or mental
quality, and
• ‘qualifications’, in relation to an employee, means any degree,

diploma or other academic, technical or professional qualification
relevant to the position which he held.

7 ENDING EMPLOYMENT
If the dismissing employer cannot justify to a tribunal’s satisfaction that the

dismissal in question does indeed fall under one of the headings set out in the
ERA i.e. capability, conduct, redundancy, contravention, and what lawyers call
Some Other Substantial Reason (SOSR), then that is the end of the matter. The
dismissal in question will be ruled as unfair, and the tribunal will proceed to
consider the matter of compensation.
Dismissals which are deemed to be automatically unfair include:

• Dismissals for trade union membership or activity, or a refusal to join
a trade union.
• Dismissal on the grounds of pregnancy or childbirth.
• Certain health and safety reasons – particularly where the dismissed

employee was an approved health and safety representative.
• A refusal to work in excess of the hours stipulated in the Working Time

Directive.
• Asserting a statutory right.
• Making a ‘protected disclosure’.
• Taking leave for family reasons – these include pregnancy, childbirth

or maternity reason and parental leave.
Note: The above reasons do not require a qualifying period of one year’s service
before they apply to employees. They apply from the first day of employment.
The Employment Act 2002 (section 34) inserted a new section 98A into the ERA.
This new clause (S.98A(10) provides that, where an employee has been
dismissed in circumstances in which an applicable Disciplinary and Disputes
Procedure has not been completed, and such non completion is due wholly or
mainly attributable to the failure of the employer to comply with the require-
ments of the DDP, the employee will be treated as having been unfairly
dismissed. The insertion of this new section effectively created a new category
of automatically unfair dismissals. i.e. those where the DDP has not been followed
by the employer when carrying out the dismissal.
Having established a fair reason to dismiss an employee under the ERA, the
determination of the question as to whether the employment was ended fairly
or unfairly, having regard to the reason shown by the employer:
• Depends on whether in the circumstances (including the size and

administrative resources of the employer’s undertaking) the employer

7 ENDING EMPLOYMENT
acted reasonably or unreasonably in treating it as a sufficient reason

for dismissing the employee, and
• Shall be determined in accordance with equity and the substantial merits

of the case.
[Section 98 (4) Employment Rights Act 1996]
The ERA does not define ‘reasonable or unreasonable’, it merely sets a subjec-
tive motivation that must first be met by the employer before the question of
fairness or otherwise comes to be considered. The test of ‘fairness’, as the Act
says, ‘shall be determined in accordance with equity and the substantial merits
of the case’, i.e. each case will revolve around the circumstances, facts and events
that occurred leading up to the dismissal in question.
Note: Chapter 4 covers the steps that must be followed by an employer to ensure
that the Disputes Resolution Regulations brought in by the Employment Act
2002 are followed in every respect.
Managers who are involved in the dismissal of any protected employee must
remember that a dismissal may be unfair even where the employer has stuck
rigidly to the procedures. This is because tribunals will always look at whether
or not the employer has a fair reason for dismissal, and behaved reasonably in
the way they went about the dismissal. The tribunal will refer to the ACAS Code
of Practice on Disciplinary and Grievance Procedures, as part of their deliber-
ations as to whether or not the employer behaved in a reasonable manner.
Acting reasonably can be summarised through the following key principles that
define ‘reasonable’ behaviour:
• Procedures should always be used to encourage employees to improve,

where possible, rather than just as a way of imposing punishment.
• An employer should never dismiss an employee for a first disciplinary

offence unless it is a case of gross misconduct.
• An employer should always give the employee an explanation for any

disciplinary action taken against them and make sure that the
employee always knows what improvement is expected of them.
• As set out above, the ERA provides for the following reasons one of
which must be established for a fair dismissal to occur:
– Capability or qualifications of the employee for performing work
of the kind which he was employed by the employer to do,
– Conduct of the employee,

7 ENDING EMPLOYMENT
– That the employee was redundant, or
– That the employee could not continue to work in the position

without contravention (either on his part or that of his employer)
of a duty or restriction imposed by or under an enactment.
To expand on these reasons:
Capability dismissals
‘Capability’ is defined in the Employment Rights Act 1996 as referring to:
• Skill
• Aptitude
• Health, or
• Any physical or mental quality.
When relying on this reason employers must demonstrate that the employee’s
capability or qualifications were the reason, or principle reason, for the
dismissal.
Skill and aptitude

Whether these attributes are present in an employee’s performance goes to the
question of an employee’s competence, or incompetence. In practice, a distinc-
tion is usually drawn between cases involving incapability due to the employee’s
incompetence, or inability to grasp and meet the standards required for the proper
performance of the duties involved, and ill health.
For an employer to dismiss an employee on the grounds of their incompetence,

or inability to meet the required standards, they must have evidence that the
employee was in fact incapable of carrying out the job properly. Often such
evidence is apparent, and acted on by the employer in the probationary, or early
stages of employment, leading to dismissal before the required year’s qualifying
service has been met necessary to mount a claim of unfair dismissal.
However, in certain instances – either through over promotion, advancing years

or other life circumstances, the incapability may arise after a period of satis-
factory performance. Clearly a distinction must be drawn between genuine
incompetence, laziness, dilatory behaviour, and incapability brought about for

7 ENDING EMPLOYMENT
other reasons. Only a thorough investigation prior to any action, coupled with
training, mentoring and an ongoing review will determine whether the problem
can be overcome. In the case of over promotion, consideration will be required
to determine if an alternative position is available which the employee can be
transferred back into. In the case of incompetence, laziness or poor attitude,
then the disciplinary procedure must be invoked. Any disciplinary action must
conclude with:
• The employee being aware of the expected standards of performance

they must achieve;
• Any training and support required to achieve the standards being

offered to the employee;
• A specific time period identified at which time the employee’s

performance will be reviewed again;
• The identification of a mentor to whom the employee can turn if they

require any ongoing assistance or advice.
Only after these steps have been followed would dismissal on the grounds of
incompetence be considered fair. As with all dismissals the Three Step proce-
dure required by the Disputes Resolution Regulations introduced by the
Employment Act 2002 would need to have been followed prior to any dismissal
occurring.
It is not for an Employment Tribunal to decide whether or not an employee was

capable of carrying out their job. Provided the employer has formed a genuine
belief in the employee’s incapability, and this belief is founded on investigation
and evidence of poor performance, then the tribunal will, all other factors being
equal, find for the employer should their decision be challenged.
Ill health dismissals

Ill health dismissals are the most frequently encountered types of capability
dismissals. Dismissal on the grounds of ill health is one of the most difficult of
dismissals for management to get right. The advent of the Disability Discrimi-
nation Act 1995 means that great care must be taken to ensure that any dismissal
does not fall foul of the specific requirements laid on employers by the DDA.
Ill health itself breaks down into two categories, frequent short-term bouts of
ill health, and serious long-term absence caused by ill health. When considering
claims of unfair dismissal on the grounds of ill health Employment Tribunals

7 ENDING EMPLOYMENT
are not particularly interested in the past events. What they concentrate their
attention on is whether or not the employer has taken reasonable steps to ensure
that they understand the nature of the employee’s ill health and, as importantly,
what is likely to happen in the future.
Short-term absence has been covered thoroughly in the section dealing with
disciplinary action on pages 60-63 entitled ‘frequent short-term absence’. Where,
after following the steps laid down in this section of the report, the frequency
of absence does not reduce to acceptable levels, then dismissal may be the only
action left for the employer to take.
Long-term absence on the grounds of ill health is another matter entirely. Even
where the absence extended into many months in length the crucial question
is, what was the status of the employee’s health at the time the decision to dismiss
was made? Was a return to work imminent or not?
The primary test for a tribunal in determining whether or not an ill health dismissal
was fair was established in the case of Spencer v Paragon Wallpapers Ltd 1976
EAT – the Employment Appeal Tribunal stated that:
‘The basic question which has to be determined in every case (of long-term
absence) is whether in all the circumstances the employer can be expected
to wait any longer (for the employee to return to work), and if so how much
longer?’ The relevant circumstances to take into account include ‘the nature
of the illness, the likely length of the continuing absence, and the need of
the employers to have the work done which the employee was engaged to
do.’
In order to answer these basic questions an employer must carry out such inves-
tigation into the employee’s absence, and the circumstances surrounding it, as
is proper. The employer should consult fully with the employee concerned, in
person whenever possible, and through correspondence where this is not
possible, to establish the employee’s circumstances and, where known, their likely
return to work date. Secondly, the employer should seek precise medical infor-
mation on the employee’s health – bearing in mind the requirements of the Medical
Reports Act 1985.
An employee cannot be forced to undergo a medical examination, unless their

contract of employment specifically requires this. Nor can an employee be forced
to submit their medical records to the employer; in the event that any dismissal
is challenged at Employment Tribunal, the employer must have records
demonstrating their attempts to obtain medical information regarding the
employee’s health circumstances, in particular their likely return to work date.

7 ENDING EMPLOYMENT
The employee should be aware that the employer is contemplating dismissal

if they do not return to work within a reasonable period of time. The issue is
not so much one of discipline, but simply one of, can the employer continue to
operate their business efficiently in the absence of the employee?
The employer must ensure that the questions asked of the medical practitioner
are precise: in particular when, if ever, is the employee likely to return to work?
If the employee blocks, or prevents the employer obtaining precise medical infor-
mation upon which a considered and reasonable decision regarding their absence
can be based, then the employer should write to the employee explaining that
a failure to allow the employer access to this essential medical information will
force the employer to make a decision on the employee’s future employment
solely on the length of the absence. Any such letter should be sent by recorded
delivery to ensure that evidence of its despatch will be available if subsequently
required.
If the medical opinion states that the employee is unlikely to return to work in
the near future, and the employer is satisfied that its business interests require
that the job the employee was employed to carry out is essential, it will normally
be fair to dismiss. It must be stressed, however, that each case of dismissal on
the grounds of ill health must be considered on its own merits.
An employer should not ignore the possibility of providing alternative employ-

ment opportunities to an employee who is absent on the grounds of ill health.
Questions should be asked as to whether alternative working arrangements can
be made, or modifications made to the work or job concerned, which would
allow the employee to return to work on a part-time basis, if not full-time. As
always, the test of ‘reasonableness’ will apply to such dismissals as to all others.
Qualification dismissals
Qualification is defined by the ERA as meaning:
• Any degree
• Diploma or
• Other academic, technical or professional qualification relevant to the

position held by the employee.
‘Qualifications’, in relation to an employee, mean any degrees, diplomas or other

academic, technical or professional qualifications relevant.

7 ENDING EMPLOYMENT
There is little case law to guide employers on the matter of an employee’s lack
of required qualifications. Where the qualification is an essential feature
required for the proper performance of the job, and the employee is discov-
ered not to have the requisite qualification, then the matter is straightforward.
Some employers choose to dismiss under the heading of misconduct having
been misled, or lied to by the employee concerned. If, however, following inves-
tigation, and after giving the employee the normal right of reply and appeal the
decision is made to dismiss, it is unlikely that an employee who has misled or
lied to an employer with regard to holding a qualification could mount a successful
claim of unfair dismissal.
Conduct dismissals
This type of breach is perhaps the easiest of all to deal with. It is often specific,
easily identified and quickest to resolve. The offending behaviour either did, or
did not occur and an investigation usually quickly identifies the facts. It covers,
as the name implies, the conduct or behaviour of employees, both against the
written disciplinary rules of the organization and the standard norms of accept-
able behaviour in the industry and society.
If the behaviour can be said to have a detrimental effect on the smooth running,
industrial relations, harmony, image or financial performance of the organiza-
tion, then it can be considered behaviour that must be addressed by management.
Where the behaviour continues after training in the standards required,
counselling and warnings which clearly state how seriously the management
view the offending behaviour, or is so outrageous as to be considered ‘gross’,
then it may be that there is no alternative left to management but to end the
contract, with notice, unless the breach is considered as ‘gross’
There is no onus of proof on employers if the dismissal is challenged at Employ-

ment Tribunal. If the employer cites conduct as the reason for dismissal, then
it will be a potentially fair dismissal and the case will be determined on the equity
and substantial merits of the case. Each case will be looked at from the perspec-
tive of its own facts and circumstances, and in coming to a decision the
Employment Tribunal must consider:
1. Whether the employer believed that the employee had been guilty of
the misconduct when they dismissed him;
2. If so, were there reasonable grounds for holding this belief? And,

7 ENDING EMPLOYMENT
3. Did the employer carry out as much investigation as was reasonable

in the circumstances before dismissing the employee?
(British Home Stores v Burchell 1980 EAT)
Case law has established that the Employment Tribunal may not substitute its
own views for that of the employer when considering whether it was reason-
able to dismiss the employee, rather than issuing a warning, or applying some
other penalty. However, if the tribunal find that the employer’s actions in treating
the matter as one for which dismissal was the appropriate penalty was outside
of the ‘bands of reasonable responses’ open to an employer faced with similar
facts and circumstances, then the dismissal will be unfair. Of crucial importance
following 1st October 2004, and the introduction of the Disputes Resolution
Regulations, brought into being by the Employment Act 2002, is that the employer
is seen to have carried out as a minimum, the ‘Standard Three Step’ discipli-
nary procedure, or ‘Modified Two Step Procedure’, as appropriate. Failure to
comply with the Regulations will lead to an automatic finding of unfair
dismissal, irrespective of the circumstances involved.
Redundancy dismissals
Redundancy dismissals fall into a category of their own. They are not a disci-
plinary dismissal, although the disciplinary record of an employee may be
considered as part of any redundancy selection process. Redundancy is ‘prima
facie’ a fair reason for dismissal, but it must meet the ‘redundancy tests’ – the
job the employee is employed to do must have ceased or diminished and any
redundancy must conform to essential procedures on selection, consultation etc.
Any decision to make employees redundant must be based on objective
criteria for selection, and all employees selected for redundancy must be fairly
selected using a published criteria.
Being made redundant is sometimes used as a euphemism for being dismissed.

This is wrong. Neither in law nor in the English language is ‘redundancy’ defined
as losing a job or being sacked.
The legal definition in law is quite precise. To be lawful, a redundancy

programme must meet either of the two definitions set out below. The employer
must:
a. Have ceased, or intend to cease, to carry on the business for the

purposes of which the employee was employed, or has ceased, or

7 ENDING EMPLOYMENT
intends to cease, to carry on that business in the place where the

employee was so employed,
OR
b. The requirements of that business for employees to carry out work

of a particular kind, or for employees to carry out work of a particular
kind in the place where the employee was employed, have ceased or
diminished or are expected to cease or diminish.
In summary therefore, an employee is redundant if, and only if, he/she is dismissed
because the employer ceases trading altogether, or because the employer closes
the particular workplace, or because the requirements of the business for
employees to carry out work of a particular kind have ceased or diminished.
There is a legal obligation upon all employers irrespective of size to follow a

fair procedure when considering redundancies. Where these procedural steps
are not followed, the employee will be in a position to successfully claim unfair
dismissal. The most important of these steps involves consultation, which must
take place both before and during the redundancy process.
Redundancy consultation
The Collective Redundancies and Transfer of Undertakings (Protection of Employ-
ment) (Amendment) Regulations 1999, which came into force on 28th July 1999
sets out the minimum requirements for consultation. Genuine consultation
involves entering into a discussion with an open mind and with a willingness
to be persuaded, before commencing the actual redundancy exercise.
There is a legal requirement to consult with individual employees, and in the

case of larger scale redundancies with trade unions or elected employee repre-
sentatives. Employers who recognise a trade union must consult that union, and
may not choose instead to consult elected representatives.
Detailed requirements are laid down for electing employee representatives in

cases where the employer does not recognise a union.
Consultation must take place with the representatives of all the employees who
may be affected by any redundancy and not just those whom the employer
proposes to make redundant. Representatives are to be given specific rights to
time off and training. The remedies available to employees and their represen-
tatives in cases where employers fail to comply with the information and
consultation provisions are simplified and strengthened.

7 ENDING EMPLOYMENT
Definition of collective redundancy

The duty to consult collectively arises where the employer is proposing to dismiss
as redundant 20 or more employees at one establishment within a period of 90
days or less. Where this condition is satisfied, the employer must consult all the
appropriate representatives of any of the employees who may be affected.
The duty to inform and consult representatives only applies where the employer
proposes to make at least 20 employees redundant at one establishment within
a period of 90 days.
Timing of redundancy consultation

Consultation with the appropriate representatives must begin ‘in good time’,
and must in any event begin:
• At least 90 days before the first dismissal takes effect if 100 or more
redundancies are proposed at one establishment within a 90-day period,
and
• Otherwise, at least 30 days before the first dismissal takes effect.
In determining how many employees an employer is proposing to make redun-

dant no account may be taken of any employees in respect of whom consultation
has already begun.
Meaning of ‘establishment’
The minimum periods for consultation depend on a given number of employees
being employed at any one establishment being made redundant. The defini-
tion of ‘establishment’ is also relevant in determining whether consultation has
to take place at all. The question here that frequently comes up is whether a multi-
sited enterprise is to be regarded as one establishment. There is no statutory
definition of establishment, so tribunals tend to adopt a common sense
approach when faced with this question.
Appropriate representatives
The employer is under a duty to consult with the ‘appropriate representatives’
of any of the employees who may be affected by the proposed dismissals or by
measures taken in connection with those dismissals. This includes employees
who, although not under threat of dismissal, might be directly or indirectly affected

7 ENDING EMPLOYMENT
by a redundancy situation. The definition of appropriate representatives is defined

as follows:
• If the employees are of a description in respect of which the employer

recognises an independent trade union, the representatives of the trade
union, or
• If the employees are not of a description in respect of which the

employer recognises an independent trade union, whichever of the
following employee representatives the employer chooses – employee
representatives appointed or elected by the affected employees for
purposes other than collective redundancy consultation, who (having
regard to the purposes for and the method by which they were
appointed or elected) have authority from those employees to receive
information and to be consulted about the proposed dismissals on their
behalf, or –
• Employee representatives elected by the affected employees for the

purposes of redundancy consultation.
Disclosure of information
The employer should provide the appropriate representatives with sufficient infor-
mation to play a useful and constructive part in the consultation process. The
employer is required to provide the following information in writing to the appro-
priate representatives as a minimum:
• The reasons for the redundancy proposals;
• The numbers and descriptions of employees it is proposed to dismiss

as redundant;
• The total number of employees of that description employed at the

establishment in question;
• The proposed method of selecting the employees who may be

dismissed;
• The proposed method of carrying out the dismissals, including the

period over which the dismissals are to take effect; and
• The proposed method of calculating the amount of any redundancy

payments to be made (other than statutory redundancy pay) to
employees who may be dismissed.
The information should be either given to the appropriate representatives, or

posted to an address notified by them to the employer or, in the case of trade

7 ENDING EMPLOYMENT
union representatives, posted to the main or head office of the union. The infor-
mation should be given in good time during the course of the consultations.
Remedies
If an Employment Tribunal finds that an employer has acted in breach of the
requirements it must make a declaration to that effect and may make a protec-
tive award. A protective award is an award of pay to the employees affected by
the failure to consult properly.
The 1999 Regulations clarify the categories of person who may bring a
complaint. A complaint may now be brought:
• In the case of a failure relating to the election of employee representatives,

by any of the affected employees or by any of the employees who have
been made redundant. In these circumstances it is for the employer to
show that the election requirements have been satisfied;
• In the case of any other failure relating to employee representatives,

by any of the employee representatives to whom the failure related;
• In the case of failure relating to representatives of a trade union, by

the trade union in any other case, by any of the affected employees
or by any of the employees who have been dismissed as redundant.
The protective award will be made for a ‘protected period’ beginning with the
date on which the first of the dismissals takes effect, or the date of the award
(whichever is the earlier), and continuing for however long the tribunal decide
is ‘just and equitable’.
Small-scale redundancies
Where an employer proposes to make fewer than 20 people redundant within
a period of 90 days, the employer must embark upon consultation with
individual employees. The employer should outline to any affected employee
what the proposals are, and should give the employee an opportunity to consider
the situation and come back to the employer at a later date with any comments,
suggestions or ideas that the employee may have. The employer should be seen
to consider the employee’s representations.
To that end, at the commencement of the consultation process, the employer should
provide the same information to employees as that required to be given to employee
representatives as set out above. This can be in the form of a fact sheet handed
to all of the employees who could possibly be affected by the redundancy.

7 ENDING EMPLOYMENT
Selection for redundancy

Unfair selection for redundancy is one of the most common types of claim made
to an Employment Tribunal. At the outset of the programme the employer should
establish fair and reasonable redundancy selection criteria. The criteria should
not depend solely upon the opinion of the persons making the selection, but
should be able to be objectively checked against such measures as attendance
record, efficiency at the job, skill levels, experience, service length, attitude, flexi-
bility etc. The employer must ensure that any selection for redundancy is made
fairly in accordance with defined criteria.
The employer must make their findings known to the employee/s concerned and
give the employee the opportunity to challenge the results if required. The
employer must also consider any representations made by the employee (or his
or her representative) in respect of such findings, and any resultant selection.
These representations will be a part of the consultation process, and detailed
records should be kept of all discussions and consultations in case of any future
challenge made by the employee/s to an employment tribunal.
It is important that the following steps can be demonstrated as having been

followed in the event of any claim of unfair dismissal arising.
• Consultation and information. As much notice as possible should be

given to any individual/s who could be made redundant.
• They should be made expressly aware when consulting them that no

decision has yet been taken as to whether they will be selected for
redundancy.
• Voluntary redundancies can be considered where appropriate before

compulsory redundancy applies.
• Objective selection criteria should be drawn up, explained and used

fairly and without bias.
• A reasonable timetable should be worked out and explained.
• Proper notice of dismissal – including notice periods – must be given

even though the dismissal is by reason of redundancy.
• The possibility of alternative employment must be considered.
• The possibility of appeal against selection should be considered.
• Wherever possible help should be provided in finding a new job.
• Full details of redundancy pay should be provided.

7 ENDING EMPLOYMENT
Alternative employment
The employer should look to see whether instead of dismissing an employee,
he or she could be offered alternative employment. This should include consid-
eration of jobs held by employees with less service than the employee who is
to be made redundant. This is a concept known as ‘bumping’.
Where the employee is offered alternative employment on terms and conditions

different from the original contract, then he or she is entitled to a four-week
trial period in the new job. If, during the trial period, the employee for whatever
reason terminates the contract, he or she will still be regarded as having been
dismissed because of redundancy.
Time off work

An employee who has been given notice of dismissal for redundancy may seek
a reasonable amount of paid time off work in order to look for another job, or
to make arrangements for re-training. This right depends upon a qualifying period
of two years’ continuous employment having been attained by the employee.
Redundancy pay
An employee who has completed two years’ continuous service and who is
dismissed for reasons of redundancy is entitled to a Statutory Redundancy
payment. The scales on which such payments are based are readily available
from ACAS or other government sources.
Dismissal due to contravention of a duty or restriction

Dismissal on the grounds of a contravention of a statutory duty means that ‘the
employee could not continue to work in the position which he/she held without
contravention (on their part or the part of their employer) of a duty or restric-
tion imposed by or under an enactment.’
The most common example of this is where a driver loses his/her driving licence,
and the job consists mainly or wholly in driving. This does not mean that the
employer can automatically dismiss such an employee, there will still be a require-
ment that the ‘Three Step’ DDP be followed, and all of the circumstances. i.e.
length of the licence loss, possibility of alternative work etc, be considered before
the decision to dismiss is arrived at.

7 ENDING EMPLOYMENT
Dismissal for some other substantial reason

Dismissal for some other substantial reason (SOSR) This is a catch-all category
which covers such matters as the non renewal of a fixed term contract; a reorgan-
ization that does not lead to redundancy, and other unspecific reasons. It is
designed to cover dismissals which are considered necessary by an employer,
but which do not fall under the headings set out above in this chapter.
If an employer can show that the reason for the dismissal of an employee was
for a ‘substantial reason of a kind such as to justify the dismissal of an employee
holding the position which that employee held’ then the dismissal can be consid-
ered as potentially fair.
Whether or not the dismissal is actually fair, will turn on the specific circum-
stances related to the actual dismissal, taking into account the size and
administrative resources of the employing organization. As with all other
dismissals, the employer will have been expected to follow a ‘reasonable’ proce-
dure which meets the minimum requirements of statute.
To such dismissals can be applied the late Lord Justice Denning’s maxim ‘the
elephant test’; “Whilst an elephant may be described to you if you have never
seen one, there is no doubt that you will know one when you see it!” SOSR reasons
for dismissals fall into this category.
Frustration of contract
Frustration of an employment contract occurs when an event arises which
prevents the continued operation or performance of the contract which neither
party envisaged when drawing up the contract terms. Such events can include
(but are not restricted to) the death of either party, a major calamity, or catas-
trophe such as an earthquake, or other natural disaster or other similar happening
that is outside of the control of the parties, and whose happening prevents the
fulfilment or proper operation of the contract of employment. Frustration is a
well-known concept in contract law, and as such has become a part of employ-
ment contract law.
Constructive dismissal
The term ‘Constructive Dismissal’ has been coined to cover the circumstances
when an employee believes that their employer has unilaterally altered their
terms of contract in a significant way and, in so doing destroyed their contract
of employment.

7 ENDING EMPLOYMENT
Any unilateral change to any fundamental part of a contract, such as pay, hours,
holidays, location etc can lead to an employee bringing a claim at Employment
Tribunal that they have been constructively dismissed. Constructive Dismissal
occurs when the actions of the employer have been so outrageous as to enable
the employee to conclude that the contract of employment is over – destroyed
by the employer’s conduct or actions, thus entitling the employee to turn on their
heel and walk away without further notice.
This risk should not however deter employers from seeking to implement essen-
tial changes to any contract of employment. What they must first do, however,
in any attempt to make changes, is to consult extensively with all employees who
could be affected by any proposed change.
Unless the employees concerned are covered by a collective agreement, and the
contract statement makes this clear, consultation must take place with each
individual employee who could be affected by any change. The aim of the consul-
tation should be to reach agreement – in writing – to any proposed changes.
Where agreement is not possible, this does not mean that the change cannot
be implemented. What it does mean is that the employer must give notice to
the employee/s concerned, that their existing contract will be brought to an end,
and that re-employment – with unbroken service – on the terms of the new revised
contract will be offered to them at the contract’s conclusion. Whilst employers
do not have the right to unilaterally change terms and conditions of employ-
ment, they do have the right to give notice to end the contract. Provided that
they give notice to employees, which is at least as long as the notice period, the
employees are entitled to under the terms of their contract. Any employment
so ended will be deemed to have been terminated for SOSR (Some Other Substan-
tial Reason).
In effect, the employee’s contract on the old terms will have come to an end and
they will be offered continued employment on the new contract terms.
Provided the consultation has been substantial, the reasons for the change signif-
icant and economically justified, and the employees given every opportunity to
comment and suggest alterations that would achieve the employer’s aims, there
is every chance that any claim for constructive dismissal would fail. In the circum-
stances where the employee does not accept continued employment on the revised
contract terms, they will not be able to claim that their dismissal was made on
the grounds of redundancy. The job will still exist, albeit on revised terms, and
as such they will not meet the necessary qualification to entitle them to redun-
dancy pay.

7 ENDING EMPLOYMENT
What is important in this process is that trust and confidence are maintained
between the parties. This factor is crucial in the maintenance of any ongoing
contractual relationship, without it no contract can survive. Trust and confidence
are based on mutual respect and an observance of reasonable behaviour by both
parties.
Wrongful dismissal
Wrongful dismissal is a common law concept. It describes any dismissal which
has occurred contrary to the terms of the contract. Any gross misconduct
dismissal, which by its nature is dismissal without notice, is prima facie a
‘wrongful’ dismissal until the ‘gross’ aspect of the breach has been proven. It
was ‘wrongful’ initially because the contract was ended contrary to its notice
entitlement terms. Unfair dismissal on the other hand is a statutory term; a concept
of dismissal defined by statute. Prior to the introduction of legislation defining
the concept of ‘unfair dismissal’ the only legally arguable aspect of dismissal
was wrongful.
Where an ex-employee is able to argue that the terms of their contract were
not met at the time of termination then it is open to them to claim that their
dismissal was wrongful. Prior to 1944 Employment Tribunals had no jurisdic-
tion to hear claims of wrongful dismissal, as they were the province of the courts.
This was changed in 1994 with tribunals being given the power to hear claims
of wrongful dismissal, their powers to make awards are, however, limited to a
maximum of £25,000. Again, this figure is subject to annual review.
There is no limit to the damages that can be awarded for wrongful dismissal
by the courts, whilst Employment Tribunal awards are subject to maximums,
usually reviewed annually. The damages that can be awarded in cases of wrongful
dismissal relate directly to the loss suffered by the employee who successfully
argues that their dismissal was wrongful.
Claims of wrongful dismissal are of most value to:
• Those on fixed terms contracts ended within the term.
• Highly paid employees where the statutory maximum at ET means they

would lose out if they pursued their claim in this court.
• Employees excluded from bringing unfair dismissal claims.

7 ENDING EMPLOYMENT
Authority to dismiss
Terminating a contract of employment is ending an agreement that had been
freely entered into by the parties. Even where short-term employees are involved
this is a significant action to take. It is important therefore that those managers
with the authority to dismiss are:
• Of a senior rank within the organization.
• Identified as having the authority to dismiss.
Also, that they are trained to understand the implications of their actions and
be fully conversant with the financial risks and implications involved, and all of
the procedures that they must follow if they are to be seen to have dismissed
‘fairly’ and in accordance with the terms of the contract/s of employment of the
employee/s concerned.
The ending of a contract of employment is never a step to be taken lightly or

without first conducting a ‘Risk Assessment’. Such an assessment will include
exploring whether the employee is a ‘protected’ employee i.e. one with over 12
months service, or one where the dismissal is in any way associated with sex,
race, maternity or the exercise of a statutory right.
Where any doubt exists on the proper way to proceed, or whether or not the
employee could successfully bring a claim against the business, then professional
advice should be sought before proceeding further.
Managers or directors should never dismiss in haste. Wherever doubt exists,

then action should be suspended until professional advice and clarification on
the correct course of action has first been obtained.

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 8
Grievances
Grievances: an introduction ...............................................................95
The standard ‘three step’ grievance procedure ..............................96
Definition of a grievance.....................................................................97
The ‘modified’ two step grievance procedure ..................................98
Overlapping disputes ........................................................................101
Grievance procedures and their impact on

employment tribunal applications ...................................................102
Chapter 8
Grievances
Grievances: an introduction
Grievances are issues or problems which employees have about their job, or
any workplace issue that affects them. It has long been the established practice
for employers to provide a mechanism which enabled employees to raise any
such issues or problems for discussion and resolution informally with their
immediate management, before proceeding, where necessary, to involve more
senior management. This right has now become a statutory right with the passing
into law of the Employment Act 2002 and the requirements of the Disputes Resolu-
tion Regulations.
These Regulations contain two statutory grievance procedures (GPs) a three stage
‘standard’ procedure, and a two stage ‘modified’ procedure.
The statutory GPs were introduced to ensure that employees’ workplace

concerns are raised, discussed and resolved before the parties become entan-
gled in tribunal litigation. Through the exercise of these simple steps the
government hopes the high volume of Employment Tribunal cases will be signif-
icantly reduced.
ACAS has long advised that employees should first raise any problem that they
have regarding the workplace informally with their immediate manager or super-
visor. This is fine providing that the problem that the employee is experiencing
is not with the manager or supervisor and the way in which they are managed.
In such instances to raise the issue with the manager or supervisor is clearly
inappropriate. ACAS’s advice has always been that if informal discussion does
not resolve the issue, then the matter should move to a more formal level with
the grievance being referred upward in the management chain in order to seek
a resolution.
Many employers have established separate grievance procedures to deal with

complaints of sexual harassment, or racial discrimination, because of the high
risk of litigation these issues can bring. There is no requirement in the Dispute
Resolution Regulations for such separation, but it is a step worth considering
for large employing organizations, where the harasser may be the immediate

8 G R I E VA N C E S
supervisor of the worker involved, and where the standard grievance proce-
dure would be wholly inappropriate to deal with the situation. It is to be
recommended that any complaint of a sexual or racial matter be raised directly
in writing at director or senior manager level, bypassing the junior ranks of
management, who may be involved in any standard grievance procedure.
It is important to note that the new statutory GPs introduced on 1st October
2004 are not intended to be best practice guides, but minimum legal standards.
They provide a minimum platform entitlement given by the legislation to all
employees. Employers are free to provide their employees with a more compre-
hensive system of grievance resolution if they choose, they are not, however,
free to provide a system which is less rigorous than the statutory minimum. This
process builds on the long established implied contractual entitlement of
employees, that their employer take reasonable steps at all times to address issues
affecting their job or workplace. A failure to do so could entitle an employee to
resign and successfully claim unfair constructive dismissal.
In order to ‘give teeth’ to the regulations regarding GPs, the EA 2002 provides
that where a statutory GP applies in respect of an employee’s workplace concern,
and where an employee presents a complaint to an Employment Tribunal which
arises from that concern, the tribunal claim will be inadmissible unless the
employee has first sent the complaint to the employer – One Step – and then
allowed 28 days to elapse before advancing their complaint to the tribunal. Where
an applicable GP has not been completed due to the action of either party, the
tribunal has the power to increase or decrease any subsequent award by between
10 and 50% depending on the allocation of fault for the failure.
The standard ‘three step’ grievance procedure

This procedure will be initiated by the employee writing a letter to the employer.
In response the employer will be required to arrange a meeting to discuss the
issue, and to provide an opportunity for the employee to appeal if the meeting
fails to resolve the matter viz:
Step 1 The employee sets down in writing the nature of the grievance and
sends this to the employer.
Step 2 The employer must invite the employee to at least one hearing, at a
reasonable time and place at which the alleged grievance can be
discussed. The employee must inform the employer what the basis
for the grievance is. The employee must make all reasonable efforts

to attend the meeting. After the meeting the employer must inform
the employee of any decision reached, and offer the employee the
right of appeal.
Step 3 If the employee considers that the grievance has not been satisfac-
torily resolved, he/she must inform the employer that he/she wishes
to appeal against the employer’s decision, or failure to make a decision.
Where possible a more senior manager should handle any resultant
appeal meeting. After the meeting the employer’s final decision must
be communicated to the employee.
Definition of a grievance
The Regulations define a grievance as:
‘a complaint by an employee about action/s which his (sic) employer has taken
or is contemplating taking in relation to him’.
This definition will also cover actions of a third party (such as a fellow
employee) in cases where the employer would be vicariously liable for those
actions. This definition covers harassment – either racial or sexual, victimisa-
tion, bullying etc.
The regulations also provide that the GPs apply in relation to any grievance about
any action by the employer that could form the basis of a tribunal claim, such
as a breach of any employee statutory right or entitlement.
The Regulations provide that the standard three-step procedure will apply in
cases where an employee is aggrieved about an action taken by his employer
and where the employee asserts this was taken wholly or mainly by reason of
something other than his/her conduct or capability. The types of actions
covered include warnings, either written or verbal, investigatory suspensions
and those actions giving rise to constructive dismissals, but will exclude all other
dismissals. The purpose here is to deal with all issues that arise, even where they
are part of the standard disciplinary procedure, and also require employees to
raise any matter which could possibly lead to a claim of constructive dismissal
being made against the employer, before proceeding to an Employment
Tribunal.
The standard three step procedure will apply in all cases where the employee
remains in the employ of the employer. It will also apply in most cases where

the employee is no longer in the employ of the employer. There are, however,
some exceptions to this rule. These are where:
a) The employer was not aware of the grievance before the employment
ended;
b) If the employer was aware, the standard grievance procedure had not
started, or had not been completed by the time the employment had
ended; and
c) The parties have agreed in writing that the modified, rather than the
standard grievance procedure, applies.
The ‘modified’ two step grievance procedure

The Regulations established a ‘modified’ two-step procedure:
Step 1 The employee sets down in writing the nature of the grievance and
sends the complaint to the employer.
Step 2 The employer must then set out his or her response in writing and
send it to the employee.
The GPs will not apply where:
• Employment has ended.
• Neither of the GPs had commenced at that point; and
• Since the end of the employment it has become not reasonably

practicable for the employee to send the One Step letter to initiate either
of the proceedings.
• Nor will there be a requirement for the employee to raise a grievance

if the employer has dismissed or is contemplating the dismissal of the
employee.
• There will be no requirement to follow the GP if the employer has taken

or is contemplating taking action on the basis of the employee’s conduct
or capability as these cases will be covered by the Dismissal and
Disciplinary Procedures referred to in Chapter 4.
However, the GPs will apply if the employee feels that the employer is unlaw-
fully discriminating against them by raising conduct or capability issues.

The parties will be treated as having complied with the GP requirements in cases
where:
• The grievance is raised in writing during a dismissal and disciplinary

procedure; or
• The GP is not completed because it was not reasonably practicable

so to do, or
• The grievance has been raised collectively by a trade union or

appropriate employee representative.
• An alternative, collectively agreed disputes resolution procedure

exists, and the employee has raised the grievance using that procedure.
• Where the standard GP would normally apply, but subsequently the

employment has ended, and since the ending of the employment it has
become not reasonably practicable for one or other of the parties to
comply with the remainder of the procedure.
• The regulations provide for the situation where an employee raises a

grievance whilst the disciplinary procedure is ongoing. Where the
grievance is raised before the appeal stage of the procedure has been
reached, then the regulations will have been complied with. Where
the grievance however is raised after the appeal stage, then the Three
Step GP must commence anew.
The following steps apply to both GP procedures and Disciplinary and Dismissal
Procedures (DDPs):
• Each step and action of the procedures must be taken without

reasonable delay.
• The timing and location of meetings must be reasonable.
• Meetings must allow both the employee and the employer to explain
their case.
• In the case of an appeal meeting, the employer should so far as is

reasonably practicable, be represented by a more senior manager than
presided over the first meeting.
• The employee can choose to be accompanied to the Two Step

meeting, and/or Three Step appeal, by either colleague or
representative.
• The role and rights of the representative in GPs is the same as that
set out in Chapter 5, under the section The disciplinary hearing, which
dealt with DDPs.

• When a disabled employee is involved in a statutory Disputes

Resolution Procedure the employer will be required to make ‘reasonable
adjustments’ so that the employee is not disadvantaged in any way.
• If the procedures are not started, or completed satisfactorily, this will

have an impact on the outcome of any subsequent tribunal case.
The following exemptions apply to both DDPs and GPs:
• If one party reasonably believes that there is a significant threat,

harassment, or
• It is not practical to go through the procedures within a reasonable

period; or
• Factors beyond the control of either party make it effectively impossible

for the procedure to be started or completed.
Note: these exemptions are intended to cover both violence, and the
threats of violence to either party, or the party’s property, or any person
or person’s property.
In any subsequent tribunal case, the tribunal may adjust any award made to
the detriment of any party that was found responsible for the procedures not
being started or completed because of a significant threat, or unreasonable delay.
If the employer, the employee, or the employee’s representative cannot reason-

ably attend a Two Step or Three Step meeting for a reason that was not reasonably
foreseeable at the time that the meeting was arranged, the meeting must be
rearranged. However, if either party did not attend a meeting and the failure
could have been reasonably foreseen, then neither party will be under any obliga-
tion under the statutory procedure. Any subsequent tribunal may, however,
attribute responsibility for failure with the commensurate adjustment of any
resultant award.
If the employee’s representative cannot reasonably attend any meeting, then the
employer must propose an alternative date within five days of the originally
proposed date. The employer is only obliged to rearrange the meeting on one
occasion. If the second meeting falls through for unforeseen reasons, then fault
will not be attributed to either party and the procedure will be deemed to have
been complied with.

Overlapping disputes
The Employment Act 2002 deals separately with disciplinary and grievance proce-
dures, but often at the workplace there is no clear distinction between the two.
The Regulations therefore lay down what is required to be done in the circum-
stances where the two types of procedure overlap.
Examples where overlapping disputes may occur are:
• Where an employer takes disciplinary action against an employee, and

this prompts the employee to raise a grievance about the action or
another matter, or to resign and complain of constructive dismissal.
• An employer has multiple disciplinary issues to raise with an employee.
• An employee may have multiple grievances to raise with the employer.
The Regulations set out that:
1. Where the action taken by the employer is dismissal (other than

constructive dismissal) then the matter does not fall under the
statutory GP. The onus is on the employer to initiate workplace
discussions under the appropriate DDP.
2. If the actions taken by the employer is not on the grounds of conduct

or capability, then there is no need for the employer to initiate the DDP.
Thus if an employee is dissatisfied he or she should raise a grievance
in accordance with the GP.
3. If, however, the action to be taken by the employer is on the grounds

of capability or conduct, then the standard Three Step DDP must be
followed, and the statutory GP will not normally apply.
4. However, the GP will apply if the employer has taken, or contemplates

taking conduct or capability related disciplinary action, and either the
employee believes it is unlawfully discriminatory, or the action is really
being taken for reasons other than conduct or capability.
5. If, however, the employee raises this, or a grievance, before the appeal
stage of the DDP has been reached, he or she will be treated as having
complied with the requirements of the GP. If the matter is not, however,
raised before the DDP appeal stage has been completed, then the GP
will be required to commence from One Stage if the required
procedures are to be seen to have been complied with.
Whilst most employers separate out their disciplinary and grievance procedures
this will not be required for the statutory procedures. Under the Regulations

both letters and meetings under the statutory procedures can be multi purpose.
So for instance, an employer writing to invite an employee to a Two Step meeting
in relation to one disciplinary issue, could use the same letter as the One Step
letter in relation to another disciplinary matter.
Grievance procedures and their impact on

employment tribunal applications
Admissibility Grievances
If an employee wishes to submit a claim to an Employment Tribunal based on
a grievance with their employer, or ex- employer, he/she must first write a One
Step letter and allow 28 days to elapse or the complaint will not be admitted.
Once this condition has been met the employee will be able to bring the claim.
If the procedures have not been completed, as the result of action or in action
on the part of either party, then any resultant award may be adjusted upward
or downward as the tribunal considers appropriate.
An employee who wishes to present a claim to an Employment Tribunal must

do so within a three month period from the date of the act complained of, however
the Regulations will allow, in certain circumstances, the time limit to be
extended to allow for extra workplace discussions to continue.
If an employee attempts to present a tribunal application arising from a griev-

ance within the normal three month time limit for so doing, but he/she has not
written the One Step letter required under the GP, and allowed 28 days to elapse,
the tribunal will decline to register the claim as the relevant admissibility condi-
tions will not have been met. This will, however, trigger an automatic three month
extension of the time limit from the date when it would have otherwise expired.
In this event, the claimant must send the One Step letter by no later than 28 days
after the date when the normal time limit would have expired. If he/she does
so, there will still be an opportunity to present a valid tribunal claim within the
extended time limit.
Where the employee sends a One Step letter to the employer, under the GP within
the normal time limit for presenting an application to an Employment Tribunal,
this will trigger an automatic three month extension of the time limit from the
date when it would otherwise have expired. It will not be necessary for either
party to have contacted a tribunal for this trigger to be effective.

Dismissal and disciplinary procedures

Where the employee has reasonable grounds for believing a disciplinary proce-
dure is ongoing at the point where the normal time limit applies, the time limit
can be extended by three months.

THOROGOOD
PROFESSIONAL
INSIGHTS
Chapter 9
Appeals
The right of appeal ............................................................................105
Chapter 9
Appeals
The right of appeal

Both the Disciplinary, Dismissal and Grievance Procedures introduced by the
Disputes Resolution Regulations that came into force on 1st October 2004, include
an appeal stage as the last stage in the standard procedures. The usefulness of
the appeal process is not confined just to employees, for it also provides employers
with the opportunity to rectify any deficiencies that may have arisen in the opera-
tion of the preceding procedural stages of both Disciplinary and Grievance
Procedures.
By far the largest majority of unfair dismissal claims lost at Employment Tribunal
by employers are caused by procedural faults. Rarely does a tribunal find that
the employer did not prove a reason that satisfied the requirements of statute
to justify the dismissal. The failure is, more often than not, one of a procedural
deficiency. The employee was not treated in a manner that the tribunal believed
to be reasonable and hence ‘fair’. There were flaws in the way that manage-
ment dealt with the issue that disadvantaged the employee and meant that they
did not receive a fair hearing before they were dismissed. It has long been the
practice at Employment Tribunal to find a dismissal that did not allow a right
of appeal, or where other aspects of the procedure were flawed to be branded
as ‘unfair’.
Both statutory DDPs and the GPs state at the conclusion of Stage Two that the
employer must:
• …notify the employee of the right to appeal against the decision if the
employee is not satisfied.
This squarely places the onus on the employer to notify the employee of their
right to appeal, a failure to do so will almost certainly render any resultant
dismissal potentially ‘unfair’.
Both statutory DDPs and GPs go on to state that:
• If the employee does wish to appeal, he or she must inform the employer.
• If the employee informs the employer of his or her wish to appeal, the
employer must invite the employee to attend a meeting.

9 APPEALS
• The employee must take all reasonable steps to attend the meeting.
• After the appeal meeting the employer must inform the employee of
his final decision.
The employer would be well advised to confirm notification of the right of appeal
to the employee in writing, including it in the letter notifying the employee of
the outcome of any Stage Two meeting. Note: The employee is required to notify
the employer if he or she does wish to exercise the right of appeal. Silence on
the part of the employee can reasonably be concluded as an intention not to
exercise the right. No further action is then required on the part of the employer.
An employee who chooses not to appeal against a decision reached as a result
of the operation of either a DDP or GP and who later succeeds with a tribunal
claim might well find his or her compensation reduced under the provisions of
the Employment Act 2002.
Section 31 of the Act states that if it appears to the tribunal that:
a) The claim to which the proceedings relate concerns a matter to which

one of the statutory (DDP or GP) procedures applies and
b) The statutory procedure was not completed before the proceedings were
begun and
c) The non-completion of the statutory procedure was wholly or mainly

attributable to failure by the employee:
• To comply with a requirement of the procedure, or
• To exercise a right of appeal under it
it must, subject to subsection (4), reduce any award which it makes to

the employee by 10%, and may, if it considers it just and equitable in
the circumstances to do so, reduce it by a further amount, but not so
as to make a total reduction of more than 50%.
Similarly where the failure to complete the procedure is due to a fault on the
part of the employer the statute states:
it (the tribunal) must, subject to subsection (4), increase any award that
it makes to the employee by 10%, and may, if it considers it just and
equitable in all the circumstances to do so, increase it by a further amount,
but not so as to make a total amount of more than 50%.
The importance of the appeal stage of both the DDP and GP procedure is made
evident by this section of the Act. It can prove expensive to either party to fail
to exercise, or complete this essential step.

9 APPEALS
A limit should be set on the period of time in which an appeal can be lodged –
five working days is enough in normal circumstances.
The right of the employee to be accompanied and represented at any appeal

meeting remains unchanged from the earlier hearings.
When scheduling the appeal hearing, the rights of the employee’s representa-
tive need to be taken into account. Where the chosen representative cannot attend
on the scheduled date and time chosen by the employer, an alternative time must
be agreed – no longer than five working days from the previously selected date
– for the rearranged hearing. Working days in this context relate to the normal
working days of the employee/s concerned. Alternative arrangements may be
necessary within all stages of the procedures, depending on the nature of work
and the work pattern undertaken, to accommodate shift workers.
Similar to earlier hearings, notes of any invitations to meetings should be retained,

together with copies of all other related correspondence exchanged between
all participants.
As far as reasonably practicable, a more senior manager or director, who has

not previously been involved in the case, should conduct any appeal hearing.
Records and notes of the original hearings should be made available to this
manager concerned before the hearing. The manager’s task is not to rehear the
matter, but to consider, on the basis of the grounds of the appeal, whether the
earlier decision should stand or be amended.
The appointment of a more senior manager or director to hear the appeal is

important. If the ultimate decision is challenged at tribunal the employer needs
to be able to demonstrate that whoever heard the appeal was capable and autho-
rised to overturn or amend any decision already reached in earlier proceedings.
The appeal hearing must not be seen to be a mere rubber-stamping exercise.
It is very difficult to argue to the satisfaction of a tribunal that a junior manager
can, or was prepared, to overturn a decision made earlier by a more senior
manager.
Where a belief exists in the mind of the manager hearing the appeal that the
original decision might be flawed on the grounds of an inadequate, or improper
interpretation of the procedure or practice followed in the original hearing/s,
it may be sensible for them to use the appeal hearing to rerun the disciplinary
or grievance hearing from scratch. In this way any procedural defects that may
have occurred in the earlier stages of the procedure can be rectified.

9 APPEALS
Unless this is the case, the manager or director hearing the appeal should confine
the hearing to the grounds on which the appeal has been lodged. It is not enough
for the employee to say that they simply disagree with the outcome of the disci-
plinary or grievance being appealed. The manager must fully explore the thinking
behind any such assertion, and be seen to consider and explore this before
reaching any final decision. It may be necessary to recall witnesses, or hear
fresh witnesses who did not appear at early meetings, where their evidence is
relevant to the matter under review, or review or introduce fresh documenta-
tion as necessary.
Records of any appeal hearing should be agreed and exchanged between the
parties and the manager should confirm the outcome of the appeal in writing
to the employee concerned, with a copy being sent to the representative.

THOROGOOD
PROFESSIONAL
INSIGHTS
Appendices
Appendix I Example of disciplinary rules and procedure ........110
Appendix II Example of a grievance procedure .........................116
Appendix III Example of a complaints procedure dealing

with harassment or bullying ....................................119
Appendix I
Example of disciplinary rules
and procedure
This is a model set of rules which include a disciplinary procedure, appeal proce-
dure and guidance notes for employees. It has been developed for employees at
a clinical practice and as such the terminology reflects this.
Preamble
The Company requires the highest standards of conduct and performance from
all employees as they perform their duties as laid down in their statement of
terms and particulars of employment, and any related documentation.
It may be appropriate to deal with breaches of the standards laid down in the
employment documentation by informal action, before resorting to the formal
procedure. Although such informal warnings may be confirmed in writing, they
will not be used during the formal disciplinary process. An example of miscon-
duct dealt with in this way might be minor timekeeping violations.
From time to time, it may be necessary for the Company to take formal disci-
plinary action against an employee. The reasons for disciplinary action may
include:
• Poor quality work or negligence, lack of application to duties, misuse

of the Company’s, residents’, colleagues’ or suppliers’ property.
• Failure to observe safe and hygienic work practices, or to follow the

Company’s, or statutory, regulations regarding health and safety.
• Refusal to carry out reasonable duties, or obey reasonable instructions,

or follow the Company’s rules.
• Aggressive behaviour, assault, or serious threat of such, whilst at work.
• Ill-treatment of, or discourtesy to clients, their relatives or colleagues.
• Misconduct, wilful damage, theft, dishonesty, malicious practices and

offences against the law, which affects the Company’s business.
• Breach of the Company’s IT, email and Internet use guidelines.

APPENDICES
Note: This list is not intended to be exhaustive, but merely provides examples
of the types of behaviour considered as inappropriate.
Stages in the disciplinary procedure

1. When a potential disciplinary matter arises, the employee’s manager
will take steps to establish the facts promptly, taking into account
statements of all available witnesses as necessary. Where witnesses
request anonymity, this will be granted if reasonable. This initial
investigation is not part of the formal disciplinary process.
2. If the employee is invited to an investigatory meeting, and the

investigation involves potential gross misconduct, they will have the
right to be accompanied by a fellow employee or Trade Union
Officer/Professional Body Representative.
3. Depending upon the outcome of the investigation, the manager will

either:
a) Take no further action
b) Give an informal verbal warning for a minor breach of standards,

rather than take any formal action. Any verbal warning may be
confirmed in writing to record the improvements required, but
in this event, the employee will be told that this is not part of the
formal disciplinary procedure, and the warning will not be referred
to in future.
c) Initiate more formal action, when the employee will be invited

by letter to attend a formal disciplinary hearing. This letter will
set out the detailed allegations and will enclose copies of any
witnesses’ statements, which may be anonymous where so
requested, and the report following the investigation. The letter
will also outline the employee’s right to be accompanied by a fellow
employee or Trade Union Officer/Professional Body Representative
at the disciplinary hearing. It is the employee’s responsibility to
arrange the attendance of his/her companion and any witnesses.
However, if the employee has been suspended, he or she should
contact their manager to invite any witnesses and a companion
who is a fellow employee. The employee will be given a minimum
of three working days’ notice, from the day that the company
reasonably anticipates that the employee will receive the invitation,
to enable them to prepare for the hearing.

APPENDICES
4. If the misconduct etc is believed to be so serious as to make dismissal

a possibility, this will be included in the letter inviting the employee
to the hearing.
5. The employee must confirm that they will be attending the hearing,
and notify the chair if they will be accompanied, and if so, by whom.
The employee must also notify the chair in advance of any witnesses
who will be called by him or her.
6. At the hearing, the employee will hear the allegations from the
investigating manager and be given the opportunity to state his or her
case before any decision is reached.
7. The decision of the manager chairing the hearing will be confirmed

in writing.
Suspension
Note: Suspension is not a disciplinary sanction.
In potentially serious cases of alleged misconduct, or particularly sensitive situa-

tions, the employee may be suspended, with pay, whilst investigations are
ongoing. Such investigations will be conducted as quickly as possible. The reasons
for the suspension will be explained. The suspension will be confirmed in writing.
The suspension will be reviewed periodically, to ensure that it is not protracted

unnecessarily.
If an employee on suspension fails to attend any disciplinary meeting without

good reason, payment for the suspension may cease.
Sanctions
An employee who is proven to have committed a first breach of the discipli-
nary standards will be given a formal written warning.
Each formal warning will remain valid for a minimum period of six months, unless
stated otherwise. The written confirmation of the warning will state:
• The nature of the misconduct.
• The improvement that is required.
• Any period of time given for improvement.
• The consequences of a further breach of the rules of conduct i.e. that

further disciplinary action could be initiated.

APPENDICES
If the employee commits a further act of misconduct during the ‘life’ of the first
warning, s/he will be given a final written warning, following a further formal
hearing, unless this further incident constitutes gross misconduct.
A final written warning will remain valid for a minimum period of 12 months,
but may in certain circumstances be for a longer period. Any period that is longer
than 12 months will be notified to the employee in the copy of the final written
warning.
Note:
1. A final warning given at this stage cannot be used to support a dismissal
for further misconduct without a further disciplinary hearing first taking
place, and the right of appeal being offered to the employee.
2. If the employee is proven to have committed a further breach during

the ‘life’ of the final warning, the Company will dismiss or demote the
employee.
3. There may be occasions when, depending on the seriousness of the

offence, a final warning is issued without recourse to the earlier stages
of the procedure.
4. Similarly, in a case of proven serious gross misconduct, the employee

will be dismissed without notice and without recourse to the earlier
stages of the procedure.
Appeals
Employees may appeal against any formal disciplinary decision taken at a formal
hearing. The appeal must be made in writing, to the Director concerned, within
five working days of receiving the disciplinary decision.
The appeal will be heard by another company manager or director, as appro-

priate, who is more senior than the original chair of the disciplinary hearing.
The employee will have the right to be accompanied by a fellow employee, or
a Trade Union Officer/Professional Body Representative. It is the employee’s
responsibility to arrange the attendance of his/her companion and any
witnesses, he/she wishes to call.
If the employee has been dismissed, they should contact their former manager
to invite any witnesses and/or a companion who is a former fellow company
employee. The ex-employee will be given a minimum of three working days’

APPENDICES
notice, from the day that the company reasonably anticipates that they will receive
the invitation, to enable them to prepare for the appeal hearing.
The ex-employee must confirm that they will be attending the appeal hearing,
and notify the chair if they will be accompanied, and if so, by whom. The ex-
employee must also notify the chair in advance of any fresh witnesses whom
they wish to call.
The outcome of the appeal will be confirmed in writing. There is only one level
of appeal.
Notes of meetings
For all formal meetings held under this procedure, the Company will arrange
for summary notes to be taken and copied to all parties. Any differences in recol-
lection of the meetings events will be recorded in writing and appended to the
disciplinary notes provided that these are notified to the company within five
working days of the notes being circulated.
Under no circumstances will any disciplinary proceedings be recorded by any

electronic medium.
Role of a companion
It will be the employee’s responsibility to organise his or her accompaniment.
If the employee is suspended, or otherwise forbidden from contacting other
employees, and wishes to be accompanied by a fellow employee, the request
for accompaniment must be made via the suspending manager.
Note: No employee shall have any obligation to agree to be a companion or a

witness at any disciplinary or appeal hearing.
The employee must follow the same process if he or she wishes any employees
who are witnesses to attend.
A companion may:
• Address the hearing.
• Confer with the employee.
• Put the employee’s case to the hearing.
• Sum up the employee’s case.
• Respond on behalf of the employee to any view expressed at the hearing.

APPENDICES
However, they cannot answer questions put to the employee by the chair of
the meeting.
Confidentiality
All documents and proceedings associated in any way with any part of the disci-
plinary process must remain completely confidential at all times. Any employee,
witness, companion etc who breaches this rule may themselves be the subject
of disciplinary action.
Gross misconduct
The following list is not exhaustive, but gives examples of offences which consti-
tute gross misconduct:
• Abuse, violence or serious threats of violence made against persons

whilst on the Company’s business, or ill treatment or discourtesy to
clients or residents, their relatives or other employees.
• Theft or unauthorised possession of property belonging to other

employees, the Company, suppliers, clients or their relatives.
• Falsification of records, including fraudulent self-certification of

absence, attendance or timekeeping.
• Wilful damage to property belonging to the Company, suppliers, clients

or residents or their relatives.
• Persistent refusal, after warning of the seriousness of a continued

refusal, to obey a reasonable instruction.
• Serious breaches of health and safety rules.
• Gross negligence.
• Unlawful discrimination or sexual, racial or other harassment.
• Breach of confidential information.
• Being under the influence of alcohol or non-prescription drugs whilst

at work.
• Unfounded or malicious allegations against colleagues.
• Failing to report to management, observed, or alleged abuse or harm

to residents.
• Being found guilty of a serious criminal offence, whether related to

work or not.

Appendix II
Example of a grievance procedure
Grievance procedure
It is the spirit and intention of this procedure that managers will make every
effort to resolve any grievance drawn to their attention by any employee as quickly
as possible.
Initially, all parties should attempt to resolve issues informally wherever possible.
Where this is not possible, this procedure provides that an employee who has
a ‘personal grievance’ shall have the opportunity to discuss the matter with
management, and to be accompanied by a fellow employee or a Trade Union
Officer/Professional Body Representative during all formal stages of the
procedure. All parties involved in the grievance should observe confidentiality
at all times.
Any hearing under the formal procedure may be deferred by up to five working
days if the chosen companion is unavailable to attend on the proposed hearing
date.
A ‘personal grievance’ for the purposes of the formal procedure is:
‘An official complaint by an employee about action that the Company has
taken, or is contemplating taking in relation to him/her, about a duty owed
to the employee by the Company from statute or the employment contract.’
Issues that may lead to the raising of a grievance include:
• Terms and conditions of employment
• Health and safety
• Work relations
• Working practices
• Working environment
• Organizational change
• Equal opportunities

APPENDICES
If the grievance is against your line manager, or regarding sexual or racial discrim-
ination, bullying or victimisation of any nature you should contact, or write to
a more senior manager, or a Director.
The procedure below will be followed for all grievances raised during your
employment, while you remain employed by the Company.
Informal stage
If you have a grievance, you should discuss this in the first instance with your
immediate manager or supervisor (always subject to the comments above
regarding the nature of your grievance). You should aim wherever possible to
settle grievances informally with your immediate manager or supervisor.
Stage one
If the grievance is not resolved informally, and you wish to take the matter further,
you should raise it formally in writing with your Manager. Such action will then
be classified as a Formal Grievance and a hearing will be arranged.
You must submit all Formal Grievances in writing. At the grievance hearing,
you will be asked to state clearly how you wish the grievance to be settled. You
may therefore wish to include this in your formal written submission.
You will have the right at the hearing to be accompanied by a fellow employee
or a Trade Union Officer/Professional Body Representative, which it will be your
responsibility to arrange.
You, or the manager, may call witnesses if they are able to assist with the settle-
ment of the grievance.
After the hearing, you will receive a written response to your grievance within
five working days.
Stage two
If the matter is still not settled to your satisfaction after Stage One, and you wish
to pursue the matter further, you may make a written request for an appeal hearing
with a manager or director senior to the person who has dealt with the matter
at Stage One.
Your request should give as much information as possible and should attach a
copy of the letter you received after Stage One.

APPENDICES
The request should be sent to the Director within five working days of you
receiving the decision from the Stage One hearing. Following the appeal hearing,
you will normally receive a written response within five working days.
Note: Appeals against any disciplinary penalty should be pursued through the
appeal stages of the disciplinary procedure and not through the grievance proce-
dure (except potentially for informal warnings where there is no right of appeal).
If you wish to raise a formal grievance concerning a matter that is related to

the subject of current formal disciplinary action against you, your grievance will
be heard at the disciplinary appeal meeting, assuming that this has not been
held at the time that you raise the grievance.
If you wish to raise a grievance about any matter that is not related to current
disciplinary action, the grievance procedure will commence at Stage One.
However, the grievance procedure cannot be used simply to provide a further
level of appeal against a disciplinary penalty or decision.

Appendix III
Example of a complaints procedure
dealing with harassment or bullying
The Company is committed to ensuring that a safe working environment is

provided to all employees, residents and visitors to its premises at all times. It
is also committed to providing equality of opportunity and treatment for all of
its employees, residents and clients.
The Company does not condone harassment or bullying of other employees,

clients, residents, members of their family or any other party associated with
the business. Harassment, whether racial, sexual, religious, or based on
disability or sexual orientation will not be tolerated under any circumstances.
All employees are expected, and required, to behave in a way that will not cause
offence to others.
It is the duty of all managers to ensure that the Company’s policy on harass-
ment and bullying is known by all staff, and that it is implemented fully in each
location.
What is harassment and bullying?

Harassment and bullying is any non-verbal, verbal or physical abuse, advances
or behaviour, which is unwanted by the recipient and which they may consider
to be intimidating, offensive or distressing, and/or unwarranted, and which the
perpetrator knows, or should know, is offensive to the recipient, or to other people
who may witness it.
It can be physical or mental and can be defined as continual and persistent,

demeaning and downgrading of individuals through words and actions that erode
self-confidence and undermine self-esteem.
The following types of behaviour may amount to harassment and bullying:
• Unwanted physical contact of a sexual nature, inappropriate, suggestive

or uninvited comments or demands for sexual favours.
• Intimate questioning about personal or sexual life.

APPENDICES
• Gossip or speculation about sexuality.
• Offensive jokes, banter, abuse, language, swearing, shouting, lewd

comments.
• Name calling, gossip, offensive graffiti, posters/calendars, flags,

emblems etc.
• Threats, physical assault, aggression, insulting behaviour or gestures.
• Isolation and exclusion of any employee at the workplace.
• Persistent, grossly unfair and excessive criticism.
• Humiliating, ridiculing or demeaning an individual.
• Unfair allocation of work and/or responsibilities.
• Unreasonable and constant under-valuation of a person’s efforts at

work.
• Continually and constantly setting unrealistic work targets or changing

work patterns.
• Constant and excessive supervision and overruling a person’s

legitimate authority.
• Intimidating or aggressive correspondence, including e-mail.
Note: The above are examples and are not meant to be an exhaustive list.
The Company considers serious cases of harassment and bullying to amount

to gross misconduct, which will be dealt with under the company’s disciplinary
procedure. Where proven this will result in the termination of the employment
of the harasser or bully on the grounds of gross misconduct.
Harassment/bullying procedure
It is recognised that, in some cases, a complaint may be of a sensitive and confi-
dential nature. Each instance will therefore be handled according to the
individual circumstances. Management recognise that there may be two
distinct approaches to dealing with the issues raised – by adopting either an
informal or a formal procedure.
The use of the ‘informal’ procedure does not mean that the complaint will be
viewed less seriously by the Company; rather that the aim is to stop the harass-
ment quickly and to prevent any re-occurrence.

APPENDICES
As soon as any complaint has been made to a company manager, using either
the informal or formal procedure, it will be investigated as a matter of urgency.
Informal procedure
If an employee considers that he or she is being harassed or bullied then they
should, if possible, inform the instigator that the behaviour is unwanted and/or
offensive. A timely written request that the behaviour is unacceptable may be
effective and stop the conduct.
Where possible, the employee should keep notes and, if possible, record in a
diary each occasion the unacceptable behaviour that has occurred, and what
actually happened, including times and locations of the event/s.
If the behaviour does not cease, then the employee should speak to his/her
manager who will consider what action to take based upon the complainant’s
wishes. If the alleged harasser is the employee’s line manager, the employee should
contact a more senior manager, or a Director of the Company.
There may be scope under the informal procedure for the manager to speak to
the alleged harasser and advise him/her of the nature of their conduct and explain
why it is unacceptable to the employee and the company. If the action continues,
or if it is not deemed to be appropriate to deal with the matter on an informal
basis, then formal action will be required.
Formal procedure
The complainant should put into writing his/her complaint to his/her line manager.
If the alleged harasser is the employee’s line manager, the employee should write
to a senior manager or a Company Director. As much detail as possible should
be given, and include:
• The name of the alleged harasser.
• What has occurred.
• Where and when it occurred.
• The name/s of any witness/es.
• Any steps taken to stop the harassment.
• Whether the alleger is prepared for his/her name to be released to the

alleged harasser as part of an investigation. If anonymity is requested,
this should be observed.

APPENDICES
The receiving manager should immediately inform the Director of the allega-
tion, and set up an urgent confidential meeting with the complainant to explore
the allegation/s fully.
The receiving manager should ensure that a thorough investigation of the allega-
tion/s is undertaken, including speaking to the alleged harasser. Consideration
should be given to the possibility of suspending the alleged harasser (on pay)
pending further investigation, or moving one or both of the parties, to ensure
that there is no immediate further opportunity for harassment.
The alleged harasser has the right to be accompanied at all stages by a fellow
employee or Trade Union Officer/Professional Body Representative.
Failure to co-operate with an investigation, or to comply with any instruction

to attend a meeting, may result in suspension without pay.
Following the investigation, a report will be prepared advising what action (if
any) is to be taken. If disciplinary action is to follow, the alleged harasser will
be provided with copies of all documentation upon which the company will rely
at the hearing. The disciplinary hearing should then be convened in accordance
with the normal Disciplinary Procedure.
On completion of the investigation and/or disciplinary procedure, the complainant

will normally be informed that action has been taken, although these details should
not be revealed to any other person on the grounds of confidentiality. Managers
should be aware of the need for confidentiality throughout this entire process,
and should try to ensure in particular the privacy of the complainant, and the
alleged harasser, who it must be remembered remains innocent of all and any
charges against them, until proven otherwise.
Note: If at the initial hearing, the accused admits to the allegation, but
convinces the manager that there will be NO future re-occurrence, then the
Company may decide not to take disciplinary action but instead, send a letter
to confirm this, warning of the likely outcome of any re-offence.

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‘Comprehensive, well written and very readable…
this is a super book, go and buy it as it is well worth
European lobbying guide
the money’ Professional Marketing International
BRYAN CASSIDY £129.00
Corporate community investment 1 85418 144 0 • 2000
CHRIS GENASI £75.00 Understand how the EU works and how to get your
message across effectively to the right people.
1 85418 192 0 • 1999
Supporting good causes is big business – and good

business. Corporate community investment (CCI) is the
general term for companies’ support of good causes, and
is a very fast growing area of PR and marketing.

Lobbying and the media: working with Managing corporate reputation
politicians and journalists – the new currency
MICHAEL BURRELL £95.00 SUSAN CROFT and JOHN DALTON £125
1 85418 240 4 • 2001 1 85418 272 2 • June 2003
Lobbying is an art form rather than a science, so there ENRON, WORLDCOM… who next?
is inevitably an element of judgement in what line to take.
At a time when trust in corporations has plumbed new
This expert report explains the knowledge and techniques
depths, knowing how to manage corporate reputation
required.
professionally and effectively has never been more crucial.
Strategic planning in public relations

Surviving a corporate crisis
KIERAN KNIGHTS £69.00 – 100 things you need to know
1 85418 225 0 • 2001 PAUL BATCHELOR £125
Tips and techniques to aid you in a new approach 1 85418 208 0 • April 2003
to campaign planning.
Seven out of ten organisations that experience a
Strategic planning is a fresh approach to PR. An approach corporate crisis go out of business within 18 months.
that is fact-based and scientific, clearly presenting the
arguments for a campaign proposal backed with evidence. This very timely report not only covers remedial action
after the event but offers expert advice on preparing every
department and every key player of the organisation so
that, should a crisis occur, damage of every kind is limited
as far as possible.
FINANCE
Tax aspects of buying and selling Practical techniques for effective project
companies investment appraisal
MARTYN INGLES £99.00 RALPH TIFFIN £99.00
1 85418 189 0 • 2001 1 85418 099 1 • 1999
This report takes you through the buying and selling How to ensure you have a reliable system in place.
process from the tax angle. It uses straightforward case
Spending money on projects automatically necessitates
studies to highlight the issues and more important
an effective appraisal system – a way of deciding whether
strategies that are likely to have a significant impact on
the correct decisions on investment have been made.
the taxation position.
Tax planning opportunities for family

businesses in the new regime
CHRISTOPHER JONES £49.00
1 85418 154 8 • 2000
Following recent legislative and case law changes, the

whole area of tax planning for family businesses requires
very careful and thorough attention in order to avoid the
many pitfalls.
MANAGEMENT AND PERSONAL DEVELOPMENT
Strategy implementation through project

management
TONY GRUNDY £95.00
1 85418 250 1 • 2001
The gap
Far too few managers know how to apply project
management techniques to their strategic planning. The
result is often strategy that is poorly thought out and
executed.
The answer
Strategic project management is a new and powerful
process designed to manage complex projects by
combining traditional business analysis with project
management techniques.
For full details of any title, and to view sample

You can place an order in four ways:

1 Email: orders@thorogood.ws
2 Telephone: +44 (0)20 7749 4748
3 Fax: +44 (0)20 7729 6110
London EC2A 3DU, UK

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THOROGOOD

A SPECIALLY COMMISSIONED REPORT

DISMISSAL AND GRIEVANCE

A SPECIALLY COMMISSIONED REPORT

Other Thorogood 10-12 Rivington Street

Professional Insights t: 020 7749 4748

© Dennis D Hunt 2005

A Practical Guide to Knowledge form or by any means, electronic,

This Report is sold subject to the

Gillian Howard No responsibility for loss

Special discounts for bulk quantities

In 1991 Dennis launched Dennis Hunt Risk Management Services Ltd a

Working with Thorogood Publishing Dennis wrote Successfully Defending

Dennis continues to work as a seminar leader and employment law consultant

THOROGOOD PROFESSIONAL INSIGHTS iii

THOROGOOD PROFESSIONAL INSIGHTS iv

5 DISCIPLINARY PROCEDURES STEP-BY-STEP 43

THOROGOOD PROFESSIONAL INSIGHTS v

Dismissals with notice and summary dismissals ...................................73

THOROGOOD PROFESSIONAL INSIGHTS vi

The volume of claims being brought before employment tribunals throughout

Employment Tribunals were originally intended to provide fast, non-legalistic,

THOROGOOD PROFESSIONAL INSIGHTS 1

In 2001 the government published a consultation document entitled Routes to

Following on from the initial consultation process, the government introduced

THOROGOOD PROFESSIONAL INSIGHTS 2

THOROGOOD PROFESSIONAL INSIGHTS 3

Summary of changes introduced by the Employment Act 2002......7

The standard three step disciplinary disputes procedure.................8

The modified disciplinary procedure ..................................................8

Default judgments .................................................................................9

Case management .................................................................................9

ACAS conciliation ...............................................................................10

Directions hearings .............................................................................10

A brief history of unfair dismissal legislation

Employment Tribunals (formerly called Industrial Tribunals) were established

In 1964 the UK government had accepted the recommendations of the Inter-

THOROGOOD PROFESSIONAL INSIGHTS 5

THOROGOOD PROFESSIONAL INSIGHTS 6

Summary of changes introduced by the

The Employment Act 2002 contained provisions preventing certain categories

THOROGOOD PROFESSIONAL INSIGHTS 7

The standard three step disciplinary

2. The employer must invite the employee to a hearing at a reasonable

3. If the employee wishes to appeal, he/she must inform the employer.

The modified disciplinary procedure

2. If the employee wishes to appeal, he/she must inform the employer.

THOROGOOD PROFESSIONAL INSIGHTS 8

• Where the employer dismissed the employee without notice on the

• The employer was entitled to dismiss for gross misconduct without

• It was reasonable for the employer to dismiss without investigating

As a result of this change a chairman may issue a default judgement where a

THOROGOOD PROFESSIONAL INSIGHTS 9

A ‘standard conciliation period’ of 13 weeks will apply to all other claims.

THOROGOOD PROFESSIONAL INSIGHTS 10

Preparation time orders may be made in favour of unrepresented litigants. Prepa-

THOROGOOD PROFESSIONAL INSIGHTS 11

THOROGOOD PROFESSIONAL INSIGHTS 12

The tests of employment ....................................................................15

Forming the contract ..........................................................................17

Contracts: the four elements ..............................................................19

The Employment Rights Act S1 –

Changing the terms of a contract of employment ..........................23