UK: EAT Gives Guidance on the Statutory Grievance Procedure

Criticism of the statutory dismissal and grievance procedures, which were introduced in October 2004, has been growing from all sides over the last few months. One of the biggest problems for employers relates to the standard grievance procedure (SGP). This requires an employee to send a written grievance to the employer (known as a ‘Step 1 grievance’) before commencing most types of tribunal claim. The employer must then invite the employee to a meeting to discuss matters - or risk paying increased compensation if the employee subsequently brings a successful tribunal claim.

It is therefore crucial that employers are able to identify Step 1 grievance letters quickly and easily, yet there is little statutory guidance to help them. However, in recent weeks the EAT has handed down a number of decisions which throw some much needed light on this issue.

According to the EAT:

• A resignation letter setting out the general nature of the employee's complaint can constitute a Step 1 grievance under the SGP (Thorpe; Shergold; Galaxy Showers);
• By contrast a discrimination questionnaire is not a Step 1 grievance (Holc-Gale);
• The Step 1 letter need not be sent by the employee personally to the employer personally - a letter before action sent by solicitors will suffice (Aspland);
• The employee need not intend to raise the mater as a grievance (Thorpe), use the word grievance, refer to the statutory procedures (Shergold) or indicate that the complaint may go further (Galaxy Showers). As a result employers will need to be particularly vigilant when assessing written communications from employees;
• The Step 1 grievance need not comply with the employer's own grievance procedure (Thorpe and Shergold). This is particularly unsatisfactory as it means the Step 1 grievance need not necessarily be sent to the person nominated under the employer's procedure and could lead to the grievance being overlooked.

An employer should be wary of any written communication from an employee or ex-employee that could possibly be construed as a complaint or grievance. It is essential that all managers (and not just senior staff or HR professionals) are trained to appreciate that such a letter could be a Step 1 grievance and that failure to invoke the remaining stages of the statutory procedure could cost the employer dear.

The recent case of Land Securities Trillium v Thornley is a reminder that employers must tread carefully when seeking to alter terms and conditions without the employee's consent.

The case concerned an architect who resigned and claimed constructive unfair dismissal after her employer unilaterally changed her duties by requiring her to manage external design consultants rather than having a hands-on design role herself.

Normally there is a clear breach of contract if an employer imposes a change of contractual duties without the employee's consent. In addition, if the change is sufficiently serious, it will amount to a fundamental breach of contract entitling the employee to resign and claim unfair dismissal.

However in the Thornley case the employee's contract contained a flexibility clause, under which the employee had to perform all the duties of her post and ‘any other duties’ which could ‘reasonably’ be required of her. The employer argued that this provision gave it a broad contractual right to alter Ms Thornley's duties unilaterally. Accordingly, in the employer's view, the change of role could not amount to a fundamental breach of contract and Ms Thornley's unfair dismissal case could not get off the ground.

The employment tribunal disagreed and found for the employee. Its decision was subsequently upheld by the EAT which confirmed that the flexibility clause was not wide enough to cover a change that would effectively de-skill Ms Thornley as a hands-on architect, regardless of whether there was a sound commercial reason for the change. There had therefore been a fundamental breach of contract entitling the employee to resign and claim constructive dismissal.

Employment contracts often contain clauses which purport to give the employer some degree of flexibility, particularly in respect of changes to duties, working hours and job location. However as the Thornley case shows, courts tend to construe such clauses very narrowly and it can be difficult to know on which side of the line a particular case falls. One alternative to imposing a change unilaterally is to terminate the old contract and offer the employee new terms and conditions, but this course of action has its own risks and needs to be considered in light of all the circumstances. Taking professional advice in this type of case is therefore strongly recommended.