The statutory grievance procedure was brought in on 1 October 2004. To recap, prior to 1 October 2004 there was no strict legal procedure in respect of grievance procedures, other than the general ACAS code, an implied contractual duty of reasonableness in redressing grievances and the pre-existing right to be accompanied to grievance meetings under s.10 Employment Relations Act 1999.
The statutory grievance procedure sets the minimum requirements that must be followed in dispute resolution procedures, and if an employee fails to firstly submit a written statement of grievance, they may be barred from bringing a claim in an Employment Tribunal. In the majority of cases the standard three-step grievance procedure must be followed:
- Step 1 – the employee must set out their grievance in writing
- Step 2 – the employer must invite the employee to a meeting to discuss the grievance and following the meeting the employee must be informed of the employer’s decision
- Step 3 – the appeal, if applicable
Either party may be penalised for failing to follow the appropriate procedure by way of an increase or decrease of up to 50% on the employee’s compensation. A modified 2-step procedure can be followed in some instances, provided this is agreed with the employee in writing.
Lord Sainsbury stated that the aim of the new minimum grievance procedure was to "offer a positive way of improving dispute resolution in our workforces". However 18 months down the line there have been complaints that the rules are overly complex and onerous and are not achieving their aim for reducing the number of tribunal claims or resolving disputes internally.
Rise in ET claims
There has been a significant increase in the number of claims received from employees in 2005-2006 compared to 2004-2005, shown by the latest Employment Tribunal Service (ETS) annual report. The number of cases being withdrawn or settled before reaching tribunal also fell from 67% to 60% in 2005-2006.
The Confederation of British Industry (CBI) has recently conducted research into workplace grievance procedures. One of their results was that 71% of lawyers believed the statutory grievance procedures made no difference to claims being resolved before tribunal. Further, 99% of lawyers representing mainly employers reported that the new procedures were more costly to their clients in terms of time and money.
The CBI’s Director of Human Resources Policy, Susan Anderson, stated:
"We are disappointed that the new regulations, designed to resolve disputes in the workplace, and new tribunal procedures have failed to have a greater impact in reducing the number of tribunal cases."
"Employer confidence in the system remains low and it is still seen as too adversarial and damaging to employee relations."
"The process is so expensive and time-consuming that many firms, particularly smaller ones, prefer to settle out of court even after advice they are likely to win the cases. The likelihood of employers recovering their costs when they are successful is very low."
Further disappointment from employers has been noted owing to the fact that the Tribunals have given an extremely wide interpretation on what can be regarded as a grievance. Some examples of what the Tribunals have classed as a grievance are: emails, resignation letters, flexible working applications and legal letters before action. As the courts have made it clear that a written grievance does not need to expressly describe itself as a grievance or state an intention to implement either the company grievance procedure or the statutory grievance procedure, many employers are left questioning whether every written gripe or complaint should be treated as a grievance.
The CBI have said that later this year they will be making recommendations to improve the regulations, particularly in respect of ensuring minor complaints are not treated as full blown grievances.
Overall it appears that the statutory grievance procedure, introduced in October 2004, is having no long-term effect on the number of cases reaching tribunal. Accordingly the regulations have not yet achieved their aim of reducing tribunal claims and resolving disputes internally.