Employers' Guide to HR

HR Update - ACAS Code of Practice

Last Modified on: 2009/03/18 11:53
Last Reviewed on: 2009/04/29 15:12

Welcome to March’s HR Update

1.  New ACAS Code of Practice
2.  Sabbaticals; a way to reduce the need for redundancies?
3.  Reminder: annual holiday increase

1. New ACAS Code of Practice
From April 6th, the current statutory dispute resolution procedures will be replaced by the ACAS Code of Practice.  This is a welcome development for many employers who have fallen foul of the headache involved in following the rigid, prescriptive statutory dispute procedures.  Although implemented with the best of intentions, to give guidance and reduce the number of tribunal claims, they caused the reverse and tribunal cases have risen significantly.  The new Code of Practice places less emphasis on the mechanics of how to manage disciplinary and grievance issues and offers more flexibility to resolve problems at an earlier stage.

Under the new ACAS Code of Practice, tribunals will be able to use their discretion to a much greater extent than currently, and a dismissal will no longer be automatically unfair due to a lapse in procedure. A failure to follow the Code will not in itself make an employer or employee liable, but an employment tribunal will take the contents of the Code into account in unfair dismissal cases when deciding whether a party acted reasonably.

A further welcome difference is compensation for failing to follow the rules will apply to employees as well as employers. Under the dispute resolution procedures, any procedural failure on an employer’s part entitled the employee to an uplift of up to 50% on any tribunal ward.  Under the ACAS code if either party ‘unreasonably fails to follow the Code’ the tribunal will have the authority to adjust any compensation, up or down, by up to 25%. 

We have listed below key aspects of the code;
• employers should act consistently and raise and deal with issues promptly, without undue delay
• employers should carry out any necessary investigations to establish the facts of the case and in misconduct cases, where practicable, different people should carry out the investigation and disciplinary hearing.
• employers should inform the employee in writing of the basis of the problem and give them the opportunity to put their case before any decision is taken
• the employee should be informed of the possible consequences to enable them to prepare for the disciplinary meeting, and copies of any written evidence which are relied upon (including witness statements) should also be provided. 
• the employee should be informed in writing of the employer's decision after any disciplinary meeting.
• employers should allow an employee to appeal against any formal action, to be heard by an impartial manager who has not previously been involved with the case
• where an employee raises a grievance during a disciplinary process the disciplinary process maybe temporarily suspended however, where they are related, it may be appropriate to deal with both issues concurrently.

Redundancies and dismissals at the end of a fixed term contract are excluded from the Code and the Statutory Dismissal Procedure should continue to be applied in these circumstances.

Under the current procedures it can be unclear when an employee is raising a grievance.  After 6th April 2009 when an employee has a grievance they will have to say so, which is another welcome change.  However, it will no longer be a requirement for employees to bring a grievance before bringing a tribunal claim against their employer.
Under the Code, employees who raise a grievance should be invited to a meeting to discuss their complaint and how they think it should be resolved, without unreasonable delay. Following the grievance meeting, the employer should write to the employee setting out what action it intends to take to resolve the grievance. The employee should also be offered an appeal against this decision. Any appeal should be heard by an impartial manager who has not previously been involved with the case.

What should you do now?
• review your disciplinary and grievance procedures to ensure they're compatible with the Code of Practice
• identify where a more relaxed and informal approach to dealing with problems at work may be appropriate
• consider including a mediation stage in your internal process (this could be an internal mediator within the organisation)

Beware!  Just bear in mind for the next month or two, that the three-stage statutory procedure must still be followed in disciplinary or grievances cases started before 6 April 2009.  Click here to download the Acas Code of Practice.

2.  Sabbaticals; a way to reduce the need for redundancies?
A sabbatical, or “career break”, is a system whereby companies allow their employees to take an extended period of leave above their usual holiday allowance - with the guarantee that their job will be held open for them when they return.  It generally has a defined purpose and lasts between 4 weeks and a year.

Some companies offer sabbaticals (generally unpaid) and in order to qualify for a sabbatical employees generally need to have been working for a company for a specified number of years.  It can be a great way of re-charging batteries, expanding the employee’s skill set and making sure the employee comes back to their role fresh and rejuvenated. Benefits to the employer of agreeing include good PR, good employee relations and if employees requests for a sabbatical are refused, the chances are they will leave anyway, and end up going to work for a competitor after taking the break, taking all their training with them.  But further, in this difficult financial climate, it can make good financial sense, as employers can make significant savings on salary, tax and NI payments, potentially reducing the need to cut labour costs by way of reducing hours or making redundancies.

If you’re considering implementing a sabbatical policy, we suggest that you include the following:
• How long an employee must have worked at your company to qualify for a sabbatical

• The maximum length of the sabbatical
• Whether or not you guarantee the employee's job, or just a similar job at the same level
• What happens to the employees' other benefits, eg pension, healthcare (note: where the contract of employment remains in force, you’ll need to get their agreement to waive their entitlement to any contractual benefits during their sabbatical)
• Whether or not employees have to commit to a certain period of service on their return
• Whether or not the sabbatical is paid
• How much flexibility you are willing to offer in terms of length of time and when it’s taken

3.  Reminder: annual holiday increase
Remember, the minimum statutory holiday entitlement, including public holidays, increases from 24 days to 28 days.

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