The scope of the ACAS Code of Practice on Disciplinary and
Grievance Procedures (the Code) has been narrowed following
two recent claims concerning ill health and some other substantial
reason (SOSR) dismissals. If the Code applies, a Tribunal can
impose a financial penalty on anyone who unreasonably fails to
comply with it. Specifically, a Tribunal can impose an uplift or
reduction of up to 25 per cent in any award it gives. It is
accepted that the Code covers disciplinary situations, which
includes conduct and poor performance. The question in the two
recent cases was whether the Code specifically applied to ill
health and SOSR dismissals.
Mr Holmes was dismissed for reasons of ill-health following
several extensive periods of absence. Qinetiq did not receive the
most current occupational health report before making this
dismissal. Mr Holmes argued the dismissal was unfair and the
Tribunal should award him with an uplift in his compensation
because of Qinetiq's failure to adhere to the Code. Both the
Tribunal and the EAT rejected Mr Holmes's position. They held
that the Code does not apply to dismissals for genuine ill health,
as capability procedures relating to an inability to do the
job, due to sickness absence, do not come within the scope of the
Code. The EAT clarified that the Code only applies to capability
situations where there is some degree of culpability on the part of
Ms Stockman was dismissed by Phoenix House for a breakdown in
the working relationship following a grievance and disciplinary
procedure. Ms Stockman's unfair dismissal claim was upheld by
the Tribunal, which considered that the Code applied and granted Ms
Stockman a 25 per cent uplift in the compensation awarded. The EAT
agreed the dismissal was procedurally and substantively unfair,
however it did not consider the Code applied to an irretrievable
breakdown in the working relationship. The EAT accepted that
discrete features of the Code are capable of being applied in SOSR
circumstances, for example recommendations for the procedure
employers should follow in disciplinary and grievance matters.
However, it ultimately held that imposing a sanction for failure to
comply with the Code in other situations, such as in these
circumstances, would go beyond Parliament's intention.
Our view is that it is always good practice to follow the Code
in circumstances where an employee may be dismissed. However, where
employers want to follow an expedited procedure, it is useful to
have further guidance as to when the Code is likely to apply.
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