GRIEVANCES

All employers (regardless of size) are required by law to have a procedure for dealing with grievances which are defined as "a complaint by an employee about action which his employer has taken or is contemplating taking in relation to him".

You are also required by law to refer to your grievance procedure in the written statement of terms and conditions which you have to provide to all employees within two months of starting work.

Ideally, employees should try to resolve their grievance informally first of all before going on to lodge a formal complaint with you.

What is a grievance?

Since the introduction of the legal requirement for employers to have grievance procedures, courts and tribunals have made a number of very liberal decisions as to what can constitute a grievance. For instance, a resignation letter setting out general complaints; a letter asking to work flexibly; and even a solicitor’s letter sent on behalf of his client.

But there do seem to be some limits. The Employment Appeal Tribunal (EAT) has said that a letter complaining of nosebleeds could not amount to a statutory grievance letter complaining of pregnancy discrimination, despite the fact that a few days later, the employee told her employer that she believed the two were connected. Equally, discrimination questionnaires cannot act as grievance letters, unless the employee expressly states that they are also raising a grievance.

Because the law lays down a set procedure which you must follow, it is important to know whether your employer has raised a grievance or not in their letter. If in any doubt, you should seek legal advice.

When does the standard grievance procedure (GP) apply?

The GP applies to any grievance about anything you allegedly have (or have not) done in relation to an employee that could form the basis of a tribunal complaint. It also applies to a situation where an employee wants to complain about something that a colleague has done if you could be vicariously liable for it.

In most cases, if the employee does not start the GP and then wait for 28 days, they will not be able to take you to a tribunal.

What does the GP consist of?

The procedure consists of three steps:

Step one

The employee must send a written explanation of their grievance to you, setting out the basis of their complaint. As mentioned above, it can be difficult for you sometimes to know whether you have received a grievance or not. If in any doubt, you should seek legal advice.

Step two

You must invite your employee to a meeting to discuss the issue which they must take all reasonable steps to attend, after which you have to tell them of your decision and of their right to appeal. You should try to arrange the meeting fairly promptly after receiving the grievance letter.

Step three

If the employee wants to appeal, you have to have a second hearing and then give them your final decision. If it takes longer than three months (the usual time limit for lodging a tribunal claim) for you to hear the appeal and give your employee the outcome, the time limit for lodging the tribunal claim can be extended by up to three months.

What is excluded under the GP?

The GP does not apply:

• If the employee is no longer working for you or if they are seriously ill, and it is not reasonably practical for them to write the step one letter
• If their grievance is about a dismissal (as long as it is not a constructive dismissal)
• if more than one employee is affected by the same grievance and it is being handled by an official of a recognised trade union (or someone elected to deal with the grievance if you don’t recognize a union)
• If their grievance is about being harassed and they believe that following the procedure would just add to the harassment

If the employee is no longer working for you, they can use a modified procedure, which is shorter and consists of two steps:

Step one - the employee sends you a written explanation of their grievance, stating the basis of their complaint

Step two - you set out your response in writing and send it to your employee

If, alternatively, one of you cannot complete one of the steps in the standard procedure (perhaps the former employee has moved away), then you can suggest using the modified procedure, but both of you have to agree to this in writing.

What happens if you do not follow the GP procedure?

Any award subsequently made to the employee is increased by 10 to 50 per cent if you fail to follow the procedure. If the employee fails to follow the procedure, their award (if applicable) will be reduced by a similar amount.

What else should you bear in mind?

At each stage of the proceedings, you must:

• take action without unreasonable delay
• ensure that the timing and location of meetings are reasonable
• ensure the employee has all the information they need before the meeting
• conduct the meeting so that both parties get a chance to explain their case
• ensure, if possible, that appeals are heard by a more senior manager than the one who attended the first meeting
• ensure the employee knows they have the right to be accompanied to meetings by either a colleague or a trade union official

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ROLLING OVER

The European Court of Justice has said that the practice of "rolled-up" holiday pay is illegal unless employers use a very transparent system to implement it. The Employment Appeal Tribunal (EAT) has now said in Lyddon v Englefield Brickwork Ltd that even if the contract does not stipulate the exact amount to be paid, rolled-up holiday pay will still be legal if the employer spells out the exact sum on the pay packet.

What happened?

Mr Lyddon worked for Englefield for 17 weeks and was told at the start that he would be paid £135 per day, including holiday pay. His weekly pay packet showed the amount of his basic wage, holiday pay added, deductions made due to tax and the net amount owing. Mr Lyddon took two weeks leave but received no extra payment for that period.

Once his employment ended, he brought a claim for holiday pay under the Working Time Regulations 1998 (WTR). .

The tribunal said that the payment had been implemented "transparently and comprehensively" and therefore complied with the law. Although Mr Lyddon did not know exactly how his pay was calculated, the weekly sums "were sufficiently transparent in that exact sums were stated with corresponding descriptions (eg 'holiday £56')."

And the EAT agreed. It said that there was a contractual arrangement "which provided that the remuneration should include a sum referable to holiday pay" and that there was a contractual agreement as to the amount.

It accepted that Mr Lyddon had not been given written contractual terms, nor had he been told in advance of starting work how the holiday pay would be calculated nor what the amount would be. However, it concluded that "it is plain that there was a system in place... for determining the sum referable to holiday pay. That could readily have been explained to Mr Lyddon at the time he started work had he asked for the information."

It also rejected Mr Lyddon's argument that the tribunal was wrong not to have followed the guidelines set out in the 2005 case of Smith v AJ Morrisroes and Sons Ltd which suggested (among other things) that employers should make clear provision for rolled up holiday pay in the contract of employment. It said these were only guidelines and were only one way of deciding whether an employer had implemented a system for paying holiday pay that was transparent and understandable.

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ON YOUR MARKS

The statutory dismissal and disciplinary procedures state that employers have to provide employees with certain information before they dismiss them. In Davies v Farnborough College of Technology, the Employment Appeal Tribunal (EAT) said that although employers do not have to disclose individual marks when making someone redundant, it would have been sensible in this case to do so.

What happened?

Mr Davies was one of three lecturers in the marketing department at the college. He had worked there for nearly 20 years and was a few years off retirement when the college announced that redundancies would have to be made.

It sent Mr Davies a step one letter dated 3 July, setting out the selection criteria for redundancy and inviting him to a meeting which took place on 11 July. A further meeting took place on 19 July at which Mr Davies was told that he had the lowest score (although he was not shown the individual scores) and was, therefore, going to be made redundant. His appeal hearing was unsuccessful.

Mr Davies claimed automatically unfair dismissal as he had not been told prior to the 19 July meeting that he was to be dismissed, contrary to step two of the statutory dismissal procedure.

Relying on the case of Alexander and another v Brigden Enterprises Ltd the EAT said that although employers do not always have to disclose an employee's marks (nor those with whom they are competing), it would have been "sensible and appropriate" in this case.

It went on to say that the college did not explain to Mr Davies how it had reached the conclusion that he should be made redundant either at or prior to the meeting of 19 July. Nor did it give him the chance to challenge the basis on which it had made that decision.

It concluded, therefore that "There was therefore, in our judgment, a breach of the procedure as so interpreted. That breach did not involve necessarily the need to disclose the marks, but it certainly involved the need to disclose very much more than was disclosed, and/or to have disclosed it earlier, and in time for the meeting, and certainly to give the opportunity for discussion which simply did not take place."

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NEW COMPENSATION LIMITS

A number of new compensation limits come into force on 1 February 2008.

	Previously	From 01.02.08
Limits on guarantee payments	£19.60 per day	£20.40
Limit on a week's pay	£310	£330
Maximum amount of a week's pay for calculating basic or additional award of compensation for unfair dismissal or redundancy payment.	£310	£330
Award for unlawful inducement relating to trade union membership or activities, or for unlawful inducement relating to collective bargaining	£2,700	£2,900
Minimum basic award for dismissal on trade union, health and safety, occupational pension scheme trustee, employee representative and on working time grounds only	£4,200	£4,400
Minimum award for employees excluded or expelled from a trade union	£6,600	£6,900
Maximum basic award for unfair dismissal (30 weeks' pay)	£9,300	£9,900
Maximum compensatory award for unfair dismissal	£60,600*	£63,000*

* There is no limit where the employee is dismissed unfairly or selected for redundancy for reasons connected with health and safety matters or public interest disclosure ('whistleblowing'), or the dismissal is contrary to discrimination law.

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