It is unlikely that anyone dealing with disputes in the workplace could have failed to notice the introduction of the statutory disciplinary, dismissal and grievance procedures in October 2004 and the potential minefield these procedures created. The central aim of the procedures was to encourage employees and employers to resolve disputes in the workplace, rather than through the employment tribunals. The Government promised to review the Regulations after two years to see if the objective had been met. The result is the independent Gibbons Review (the Review), which has just been published, suggests that the procedures have failed to avoid disputes arising and instead led to a wealth of other problems.

Abolition of procedures

Firstly, and most importantly, the Review has recommended a complete repeal of the statutory disciplinary and grievance procedures. It commented that rather than encouraging early resolution in the workplace, the regulations exacerbate and accelerate disputes by requiring the use of formal procedures to deal with problems that could have been resolved informally. In addition, the complexity of the procedures and the penalties imposed for failure to comply with them, have led to both employees and employers having to seek external legal advice at a very early stage of the dispute.

Other key recommendations

The Review also recommended that the Government should:

  • Support employers and employees to resolve more disputes in the workplace by:

(a) replacing the statutory procedures with simple and flexible guidelines on grievances, discipline and dismissals in the workplace, which will encourage good practice and early resolution of disputes without laying down strict steps

(b) providing incentives to comply with the new guidelines with sanctions through costs orders or adjustment of tribunal awards against those who do not make adequate efforts to resolve the dispute or who otherwise behave unreasonably

(c) putting an obligation on employer and employee organisations to promote early dispute resolution, e.g. through the use of in-house mediation, early neutral evaluation, and provisions in employment contracts.
  • Actively assist the parties to resolve disputes that have not been resolved in the workplace by:

(a) introducing a new, simple process to settle monetary disputes on issues such as wages, redundancy and holiday pay, without the need for tribunal hearings

(b) improving the advice (through help lines and the Internet) given to parties of a potential dispute about the reality and implications of bringing/defending proceedings and other options available, and re-designing the "entry point" to the employment tribunal to ensure that the parties receive the relevant advice at the outset

(c) offering a free early dispute resolution service (including mediation) before a tribunal claim is lodged, initially for those disputes most likely to benefit from it

(d) providing incentives to use early resolution techniques with sanctions through costs orders or adjustment of tribunal awards, taking into account the parties' efforts to settle the dispute.
  • Make the employment tribunal system simpler and cheaper by:

(a) simplifying employment law (an epic task!) and the tribunal claim and response forms

(b) enhancing and/or encouraging better use by tribunals of powers in relation to: (i) weak and vexatious claims (and reviewing whether existing powers should be extended); (ii) the use of active, early case management; and (iii) the management of multiple-claimant cases.

Summary

The focus of the Review is very much on guidelines for good practice, rather than the current rigid procedures. By recommending greatly increased use of mediation, better quality advice to potential claimants and respondents as well as new and increased powers for tribunals when making awards or costs orders, the Review brings a welcome dose of common sense to an unnecessarily complex area of law.

The Government has promptly issued a consultation document in response to the recommendations in the Review. The consultation will close on 20 June 2007. It remains to be seen what changes will be made to the current legislation, but there is little doubt that we can expect an overhaul of the way disputes in the workplace are handled.

www.mishcon.com.

This article is only intended as a general statement and no action should be taken in reliance on it without specific legal advice.