DISCIPLINARY PROCEDURES

Sometimes the conduct or capability of an employee means that you have to take disciplinary action against them. It has always been good practice to have a proper procedure written down so that everyone knows what to expect, but you have been required by law since October 2004 to follow standard dismissal and disciplinary procedures (DDP).

Just to confuse you, the government has recently introduced a bill into the House of Lords proposing to repeal those procedures, but for the time being they remain in place.

What information are your employees entitled to?

The Employment Rights Act 1996 says you have to give employees a written statement specifying what disciplinary and grievance rules apply at work.

Those rules should be readily available and you should make every effort to ensure that your employees know and understand them. They should also be made aware of the likely consequences of breaking the rules and, in particular, should be given a clear indication of the type of gross misconduct which may warrant summary dismissal, such as theft, violence or drunkenness.

When does the standard dismissal and disciplinary procedure (DDP) apply?

The DDP applies if you are thinking about dismissing an employee or disciplining them for something to do with their conduct or capability.

There are three steps to the procedure:

Step one - you give the employee a written statement about the circumstances that led you to consider taking the action
Step two - you invite the employee to the meeting, after which you inform them of your decision and of their right to appeal
Step three - if your employee wants to appeal, you must invite them to a second meeting and then let them know the final decision after the appeal hearing

What is excluded under the DDP?

The new procedures do not apply to oral and written warnings, nor to circumstances in which the employee is suspended on full pay. Equally, they do not apply to constructive dismissals, so in any of those circumstances you should follow your own internal disciplinary procedure (see below).

What is the modified procedure?

There is a modified procedure to the above that applies if you have dismissed someone without notice because of their gross misconduct. The dismissal must take place more or less on the spot, and it must have been reasonable for you to have taken that kind of drastic action without any investigation and without giving your employee any notice.

There are two steps to the modified procedure:

Step one - you send the employee a written statement of the alleged misconduct that led to the dismissal, including the evidence for your decision and telling them of their right of appeal
Step two - if your employee wants to appeal, you must invite them to a second meeting and then let them know the final decision after the appeal hearing

What happens if you don’t follow the DDP procedure?

If you don’t follow the procedure correctly, the dismissal will be automatically unfair (assuming the employee has the right to claim unfair dismissal). The employee will receive a minimum of four weeks’ pay and any additional compensation will be increased by 10% to 50%.

What other disciplinary procedures should you adopt?

The following is an outline of a model disciplinary procedure. In smaller firms, it may not be practicable to adopt all the provisions, but most should be capable of incorporation into a simple procedure.

It should:

• be in writing
• specify to whom it applies
• provide for matters to be dealt with quickly
• indicate the disciplinary actions which may be taken
• specify the levels of management which have the authority to take the various forms of disciplinary action, ensuring that immediate superiors do not normally have the power to dismiss without reference to senior management
• provide for employees to be informed of the complaints against them and to be given an opportunity to state their case before decisions are reached
• give employees the right to be accompanied to meetings
• ensure that, except for gross misconduct, employees are not dismissed for a first breach of discipline
• ensure that disciplinary action is not taken until the case has been carefully investigated
• ensure that employees receive an explanation for any penalty imposed
• provide a right of appeal (as required by the DDP) and specify the procedure to be followed

Minor cases of misconduct and most cases of poor performance are obviously not covered by the DDP. They are probably best kept separate from the formal disciplinary procedure and resolved through informal advice, coaching and counselling. Informal warnings are not part of the disciplinary process and employees should know this.

Does the employee always have the right to state their case?

Before any decision is made or any sanction imposed, you should give the employee the opportunity to put forward their side of the story. Since the whole purpose of a disciplinary hearing is to determine whether or not someone should be disciplined or dismissed, the only way to come to a reasonable decision is to hear what the individual has to say. An employee may have a perfectly legitimate explanation for what you first viewed as misconduct. Equally, there may be mitigating circumstances which warrant lenient treatment.

What information is the employee entitled to?

If an employee is to have an opportunity to explain, it follows that they must have full details of the allegations against them. Any statements taken from witnesses should also be made available to the employee in advance of the disciplinary hearing. However, this is not an absolute rule and in certain circumstances, may be withheld.

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HIRING AND FIRING

What happened?

Ms Klusova, a Russian national, started work for the Council in November 2000. In March and May 2004 she applied to the Home Office for "a leave to remain work permit" before her right to live and work here ran out in May 2004. Both applications were refused.

The Council contacted the Home Office in early March 2005 and was told that she was an "overstayer", but that she was allowed to work until her appeal was heard. However, when it made further inquiries in July 2005 it was told she was not entitled to work. The Council summarily dismissed her on 10 August. It did not follow the statutory dismissal and disciplinary procedure (DDP). She claimed unfair dismissal.

The Employment Appeal Tribunal (EAT) said that, at the time of her dismissal, Ms Klusova could not continue to work without contravening the law. As the Council had a genuine belief that she could not continue in her employment without contravention of an enactment, this amounted to "some other substantial reason", making her dismissal fair.

The Court of Appeal partially reversed the EAT decision. It said there was some evidence to show that Ms Klusova had made a valid in-time application and she therefore had the right to work, pending a decision on her application. The confusion had arisen because of differing advice from different sections of the Home Office.

On the other hand, the Court agreed with the EAT that her dismissal could be "for some other substantial reason". Although there were flaws in the procedure the Council had followed to establish whether Ms Klusova was allowed to remain and work, it clearly held a genuine belief that it she did not have a legal right to work here.

But although the Council succeeded on this point, the dismissal was still unfair because it had failed to follow the statutory DDP.

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AGEING DIRECTIVE

The Equal Treatment Directive says that employers are not allowed to discriminate against workers on the basis of age, unless it can be justified. In Palacios de la Villa v Cortefiel Servicios SA, the European Court of Justice (ECJ) held that a Spanish law requiring compulsory retirement at 65 to promote employment could be justified.

What happened?

Mr Palacios de la Villa was dismissed in July 2005 when he reached 65, as per the collective agreement governing his work. This stated that, in order to promote employment, all workers had to retire at 65 unless they had not worked long enough to qualify for their pension. Mr Palacios de la Villa claimed age discrimination.

The collective agreement was in line with a statute introduced by the Spanish government in 2005 allowing for compulsory retirement clauses in collective agreements as long as they were linked to legitimate employment policy objectives to promote the "quality of employment." This law was also retrospective, so applied to agreements already in force except that they did not have to show they were linked to an employment policy objective.

The ECJ said that the law introduced by the Spanish Government directly imposed less favourable treatment on workers who had reached 65, compared with everyone else in the workforce. However, as the compulsory retirement age was part of a policy to promote full employment (a legitimate social policy) it could be justified.

The Court noted that member states (and in some cases social partners) enjoyed broad discretion about which aims to pursue in terms of social and employment policy, as well as deciding how those could be achieved.

It did not seem unreasonable, therefore, for a member state to take the view that a compulsory retirement age was an "appropriate and necessary" measure to achieve the legitimate aim of promoting full employment, once workers qualified for a pension.

As the social partners (trade unions and employers’ organisations) had a degree of flexibility in deciding how the compulsory retirement provisions could be applied, it was satisfied that the law ensured a balance between the different interests. On that basis, it said that the national legislation was not incompatible with the Equal Treatment Directive.

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IN BRIEF

No one can pretend that employment law is easy, so when the government produces a free handbook, it’s usually worth having. And that is definitely true of "Individual rights and responsibilities of employees. A guide for employers and employees" which has been updated to reflect the latest changes in employment law.

This guide outlines employees' and workers' individual rights and responsibilities and the corresponding obligations for employers. It covers contracts, pay, dismissal, parental legislation, other time off, anti discrimination law as well as other statutory employment rights, complaints and remedies.

It is available from the BERR Publications Orderline (0845 015 0010, quoting URN 07/1416).

Or you can order it online at www.berr.gov.uk/publications/index.html

Alternatively, you can download it for free on: www.berr.gov.uk/files/file34565.pdf

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