UNFAIR DISMISSAL AND THE ACAS CODE OF PRACTICE ON DISCIPLINE AND GRIEVANCE

Employers will welcome an Employment Appeal Tribunal (EAT) decision that provides further guidance on how an employment tribunal will apply the procedural requirements of the Acas Code in unfair dismissal cases. The EAT held that an employer's decision to dismiss was fair following a number of acts of misconduct and a final written warning. This was despite the employer's failure to formally notify the employee of the potential consequences of the disciplinary hearing, or the written warning, in accordance with the Acas Code.

Despite this decision, employers should be aware of the risks connected with non-compliance with the Acas Code, and ensure that they follow the best practice procedures set out in it, to reduce the scope for procedural unfairness claims. It also highlights the importance for employers of having clearly drafted policies and procedures, which can be relied upon in the event that their actions are challenged and if you would like us to assist you with this please contact Keith Parr, employment partner, on 01772 253841, kgp@bsglaw.co.uk or by post.

Set out below are the key issues a business should consider when conducting a disciplinary procedure connected with misconduct or poor performance.

The Acas Code of Practice (Acas Code) was introduced in 2009 to replace the statutory disciplinary procedures. Employers are required to follow the code in disciplinary situations.

Why is it important to follow the Acas Code?

It can avoid a finding of unfair dismissal

The Acas Code was introduced to help businesses and employees deal effectively with issues of alleged misconduct or poor performance. When deciding whether an employee has been unfairly dismissed for misconduct or poor performance, an employment tribunal will consider whether the business has followed a fair procedure, and must take the Acas Code into account when considering whether an employer has reasonably or not.

It can affect the level of compensation

If an employee’s claim is successful, but either the business or the employee has failed to follow the Acas Code, the level of compensation awarded can be affected:

• If the business unreasonably failed to follow the Code, the employment tribunal may increase the employee’s compensation by up to 25%.
• If the employee unreasonably failed to follow the Code, the employment tribunal may reduce their compensation by up to 25%.

How should misconduct or poor performance be handled?

Investigate the issues

• The business must carry out a reasonable investigation of the issue (for example, by conducting an investigatory meeting with the employee under investigation). Any investigatory meeting should not result in disciplinary action without a disciplinary hearing taking place first.
• If paid suspension is necessary during the investigation it should be as brief as possible and kept under review. The business should clarify that this is not in itself a form of disciplinary action.  

Inform the employee of the issues in writing

• If, following the investigation, it is found that there is a case to answer, the business should notify the employee in writing of the alleged misconduct or poor performance and its possible consequences in sufficient detail to enable them to respond at a disciplinary hearing.
• The notification should set out details of the disciplinary hearing, for example, the time and place of the disciplinary hearing.
• The disciplinary hearing should be held without unreasonable delay. However, the business must ensure the employee has reasonable time to prepare their case.
• Any written evidence (for example, witness statements) should be provided to the employee.

There must be a disciplinary meeting or hearing

• The business should not make a decision to dismiss or take other disciplinary action without a disciplinary hearing or meeting taking place first.
• If the employee is persistently unable or unwilling to attend, without good reason, the business is entitled to hold the meeting or hearing in their absence and make a decision on the available evidence.
• Either side should give advance notice of any witnesses they intend to call.
• At the hearing, the :

• business should explain the allegations and go through the evidence;
• employee should be allowed to set out their case and answer the allegations; and
• employee should have a reasonable opportunity to ask questions, present evidence, call relevant witnesses and raise points about any information provided by the business’ witnesses.

Inform the employee of the decision in writing

After the hearing, the decision should be sent to the employee in writing without unreasonable delay. Written warnings should set out:

• The nature of the misconduct or poor performance.
• The improvement required.
• The timescale for improvement.
• How long the warnings will remain current.
• The consequences of further misconduct (or failure to improve) within that period.
• The employee’s right to appeal the decision and the procedure they need to follow to do so.

The employee has a right of appeal

• If the employee feels the disciplinary action against them is unjust, they should appeal in writing, specifying the grounds of their appeal.
• If they bring a tribunal claim without appealing, any compensation they are awarded may be reduced.

Practical steps for businesses to take to improve their disciplinary procedures

• Involve employees in developing workplace procedures, and make sure those procedures are transparent and accessible to employees.
• Encourage managers to manage conduct and performance issues quickly and informally before they get to a formal disciplinary stage.
• Investigate issues thoroughly. Even if the employee has attended an investigatory interview, always hold a disciplinary hearing once all the evidence is available, and allow the employee to put their side of the story before making any decision.
• Keep written records, including minutes of meetings.
• Communicate decisions effectively and promptly, setting out reasons.

 

 

For further information or help with any employment law related matters please contact Keith Parr Partner BSG Solicitors 10 Chapel Street, Preston, PR1 8AY

Tel: 01772 253841

Fax: 01772 201713

E-mail: kgp@bsglaw.co.uk

Web: http://www.bsglaw.co.uk

Late Payment of Commercial Debts Regulations 2013

 

 

Summary. The Late Payment of Commercial Debts Regulations 2013  came into force on 16 March 2013.

Background. The 2013 Regulations implement the changes set out in the Late Payments Directive  and amend the Late Payments of Commercial Debts (Interest) Act 1998.

Facts. The aim of the 2013 Regulations is to encourage prompt payment of invoices, in particular to protect small suppliers from suffering cash flow problems due to late payment of their invoices.

The 2013 Regulations will apply to the supply of goods and services and impose new time limits to pay invoices in addition to the existing statutory rate of interest for overdue payments set out in the 1998 Act. The amendments made by the 2013 Regulations will only apply to contracts made after 16 March 2013.

The 2013 Regulations introduce new time limits to pay invoices for the following types of contract:

         Business-to-business contracts.

If the contract is silent on the payment term, payment must be made within 30 calendar     days after the latest of the customer receiving the supplier's invoice, receiving the good or services, or verifying or accepting the goods or services. If the contract contains an express payment term, the parties can agree payment up to 60 days from the date of invoice, receipt of goods or services or verification or acceptance of the goods or services. The parties can agree an extension to this limit and go above 60 days as long as this is in writing and not "grossly unfair". The 2013 Regulations define "grossly unfair" as anything that is a gross deviation from good commercial practice and contrary to good faith and fair dealing, taking into account the goods and services in question, and whether the buyer has any objective reason to deviate from the standard 60-day period.

                 Business-to-public authority contracts.

If the contract is silent on the payment term, payment must be made within 30 calendar days after the latest of the   customer receiving the supplier's invoice, receiving the good or services, or verifying or accepting the goods or services. Public authorities must pay more quickly than businesses. If the contract contains an express payment term, public authorities must pay within 30 days from the date of invoice, receipt of goods or services, or verification or acceptance of the goods or services. There is no possibility to extend this period.

The 2013 Regulations do not change the statutory rate of interest that applies to late payments not made within the prescribed payment period. This remains at the current level of 8% over the Bank of England base rate (which is used as the base reference rate fixed on 1 January for the following six months and then on 1 July for the following six months).

Parties may contract out of the statutory interest rate and negotiate their own more commercially acceptable interest rate as long as it provides a substantial remedy for late payment.

The supplier can claim a fixed charge for recovering the debt (£40, £70 or £100 depending on the size of the debt) plus any other reasonable costs of recovery.

 Comment. Clients should review their standard terms and conditions of purchase to see if they include a payment period that exceeds 60 days, as a customer will be required to justify that such a longer term is not grossly unfair to the supplier. Note that any term that completely excludes the right to claim interest will always be considered grossly unfair.

 Contact Keith Parr, Head of the Litigation Department of Blackhurst Swainson Goodier LLP , by telephoning 01772 253841. kgp@bsglaw.co.uk.