Employers need 'clear, simple, non-prescriptive guidelines on grievances, discipline and dismissal … encouraging early dispute resolution". Sounds familiar? This was of course the objective of the statutory dismissal and grievance procedures, introduced in October 2004 to promote the resolution of employment disputes in the workplace rather than in the employment tribunal. But this recommendation comes from a DTI commissioned report which concludes that the statutory procedures have failed to meet this objective and recommends that they should be abolished, a mere two and a half years after they were first introduced.
The Gibbons Report, commissioned by the DTI to review employment dispute resolution in Great Britain makes 17 recommendations which, if implemented, will have far reaching consequences for the handling of workplace disputes. The most significant of these is the recommendation that the statutory dispute resolution procedures be abolished in their entirety – a damning indictment on those procedures but one which echoes the sentiments of many employers in the sector. Michael Gibbons, the author of the Report, said 'I was struck by the overwhelming consensus that the intentions of the 2004 Dispute Resolution Regulations were sound and there was a genuine attempt to keep them simple. However, they have had unintended consequences which far outweigh their benefits.'
There is a general consensus among employers – in the University sector and beyond – that the statutory procedures have created an unnecessarily high administrative burden for both the employer and employee. The Report highlights that many businesses consider that the statutory procedures have led to an increase in the number of disputes they experience. Further, rather than encouraging early resolution, the procedures have led to a more formal process being used to address problems which might easily have been resolved informally. As a result, conflicts escalate, taking up more management time and engaging employees in an unnecessarily formal and stressful process. There is evidence that both employers and employees are seeking legal advice on their disputes at an earlier stage than before, and that the costs and management time involved in dealing with disputes is steadily increasing.
The Report also notes that the application of the 'one size fits all' formal approach inherent in the statutory procedures creates significant problems – the procedures often appear excessive or difficult to apply to the situation in question. The strong links between the formalities of the statutory procedure and employment tribunal proceedings creates a focus on ensuring that the procedures are strictly adhered to rather than addressing the causes of the underlying problem. [OUR COMMENT: Yes, the causes of the underlying problem, i.e. institutionalised bullying and harassment by managers.] This is particularly so given that an employer risks a dismissal being found to be 'automatically unfair' if the statutory dismissal procedure is not followed. The procedures also make both parties more defensive, and entrench their respective positions, making it more likely that they will ultimately resolve their dispute in the employment tribunal. [OUR COMMENT: And is this the fault of the employee?] Alternative approaches are needed to provide more appropriate methods of achieving an earlier, amicable and cost-effective resolution to workplace disputes and grievances. [OUR COMMENT: At last some sense.]
Implications of the abolition of the statutory procedures
It is highly likely that the Gibbons Report will result in the statutory procedures being abolished or undergoing radical amendment. This will bring some immediate benefits for Universities, particularly in dismissal cases where there would no longer be the risk of automatic unfair dismissal for failing to follow the statutory dismissal procedure. [OUR COMMENT: Is this a good thing for employees?] This may be especially helpful in relation to fixed term contracts, where many institutions still struggle at times to manage the expiry of a fixed term contract in a manner consistent with the statutory '3 step' procedure, or where the volume of fixed term contract dismissals makes compliance impracticable.
Similarly the removal of the risk of increased compensation for failing to follow the statutory grievance procedure will be welcomed by Universities, especially given the wide interpretation of what counts as a statutory grievance. [OUR COMMENT: Yes, they get off the hook.] Further, the risk that managers may rush to use formal procedures to deal with any complaint – for fear of breaching the statutory grievance procedure – would also be removed. There may also be no need to hear post-termination grievances from former employees.
However, there would also be some disadvantages. Abolishing the statutory procedures may see a return to the pre-October 2004 situation where the employer first becomes aware of a dispute when it receives a tribunal complaint form. It is also likely that any new regime would be less prescriptive than the statutory procedures and therefore less certain in its application.
What will replace the statutory procedures?
The key issue is what, if anything, will replace the statutory procedures. The Gibbons Report offers few concrete clues. One recommendation is that the Government should look at ways of minimising disputes by simplifying employment law 'recognising that its complexity creates uncertainty and costs for employers and employees'. This is a welcome objective but the report gives no suggestions as to how this can be achieved, noting only that the impact of European Directives may create difficulties. The Report also recommends that the Government considers ways to enable tribunals to weed out unmeritorious claims, but again without any specific recommendations as to what new powers tribunals should receive.
The other main recommendations of the Report are:
- that the statutory procedures should be replaced with clear simple non-prescriptive guidelines on grievances, discipline and dismissal. This sounds very much like a slightly beefed-up version of the ACAS Codes of Practice;
- that tribunals should have new powers to take into account the reasonableness of the parties behaviour and procedure when making awards and cost orders. This could see similar powers to reduce or increase compensation as currently exist in relation to compliance with the statutory procedures, but perhaps with less predictability of what would constitute default;
- that the tribunal claim form should be revised to reduce its length and complexity. This would see a return to something like the pre-October 2004 version;
- that the fixed time limits for ACAS conciliation introduced in October 204 should be removed;
- that claimants should have to access a helpline service before bringing a tribunal complaint. The helpline would advise on alternatives to bringing tribunal claims and its use would be mandatory as claimants would only be able to access a claim form via this helpline. Similarly, employers would only be able to get a response form to complete once they had received advice on the potential consequences of defending a complaint. The aim is to ensure that both parties are advised on the reality of bringing tribunal claims and the benefits of seeking to resolve their dispute by other means; [OUR COMMENT: What means exactly?]
- that increased emphasis should be given to mediation and other forms of alternative dispute resolution, to reduce the number of claims proceeding to tribunal. This could see the introduction of a free early dispute resolution service before a claim is lodged, or the greater use of judicial mediation when a dispute reaches the tribunal system. Tribunals should be able to take into account the parties' attempts to settle disputes, or their willingness to explore resolution through mediation, when making awards of compensation or costs, giving the parties an incentive to explore settlement or mediation;
- that employers, trade unions and other employee organisations should be "challenged" to commit to implementing and promoting early dispute resolution, for example through greater use of in house mediation, early neutral evaluation of claims and provisions in contracts of employment which made mediation of disputes a contractual obligation for employer and employee, whether as part of, or in addition to, the employer's grievance procedure. [OUR COMMENT: Ah, well here is some work for our union (UCU).]
The clear message from the Gibbons Report is that the measures introduced in October 2004 – statutory procedures, new claims forms, fixed ACAS conciliation periods – have failed to reduce the number of disputes and their related costs for employers, employees and the tribunal system. However, it is unlikely that we will see a simple return to the pre-October 2004 position. Universities will need to keep up to speed with these developments, particularly once concrete proposals are issues by the Government for reform of the existing disputes resolution procedure. In the meantime, it may be useful to consider and explore sources of alternative dispute resolution and whether there is a greater role for mediation – or mediation-style procedures – to complement existing grievance processes.
Perhaps our union (UCU) may wish to engage in this process and not just follow what the DTI recommends. We welcome the emphasis on mediation-style procedures but these will require senior managers who are trained appropriately - some wishful thinking here.