Law firms need to review their disciplinary, dismissal and grievance procedures to ensure they comply with new statutory standards – or face having dismissals deemed automatically unfair and compensation awards increased, they were warned last week.

The new procedures – which apply in most cases of dismissal and discipline – aim to encourage employers and their staff to deal with disputes internally and reduce the number of cases that reach employment tribunals.


Smith: warning of confusion The new standard disciplinary procedure has three stages: a statement of grounds/an invitation to meet is provided to the employee; a disciplinary meeting is held, which must occur before any action is taken, except suspension; and the employee is entitled to appeal.

The grievance procedure follows a similar format. An employee will not be able to bring a tribunal claim unless the grievance procedure has been gone through first.


If the employer fails to comply with the statutory procedure, the dismissal is deemed to be automatically unfair and the compensation can be increased by 10 to 50%, although the usual cap – currently £55,000 plus basic award – remains. This is the case even if the employer had a manifestly fair reason for the dismissal.


There is also a modified, short-form procedure applying to gross misconduct cases; however, according to Catriona Smith, an employment partner at City firm Linklaters, an employer can only decide that gross misconduct has occurred after following the procedure. If he uses the short-form procedure and it turns out not to be gross misconduct, this would lead to a finding of automatic unfair dismissal.


If the employee fails to follow the proper procedures, the compensation can be reduced by 10% to 50%.


In addition, the time limit for bringing a tribunal claim is doubled to six months where the statutory procedure is involved.


Nick Hine, an employment partner at south-east firm Thomas Eggar, said it is important for firms to review their current procedures, especially as the new provisions apply in circumstances that were previously not covered, such as redundancy and the end of fixed-term contracts.


Suggesting that smaller law firms can be quite ‘haphazard’ in the way they deal with employment matters, he warned that they could easily fall foul of the rules if they are not careful – a programme of training and information is important. ‘Mistakes could prove costly and time consuming,’ he added.


Ms Smith said the rules have ‘a laudable aim’, but warned that confusion about when the procedures apply could potentially lead to more tribunal actions, not less.