A recent Employment Appeal Tribunal (EAT) ruling has shed new light on the applicability of the ACAS Code of Practice on Disciplinary and Grievance Procedures, particularly in situations involving 'without prejudice' discussions. The judgment clarifies when the Code, which can lead to adjustments in compensation awards, comes into play during workplace disputes, offering crucial guidance for both employers and employees.
The case centred on an employee who raised an informal complaint about alleged bullying and harassment, which subsequently led to 'without prejudice' discussions aimed at settlement. These discussions concluded with a settlement offer being made. The employee later resigned and brought claims for constructive unfair dismissal and discrimination. Crucially, no formal grievance was submitted by the employee prior to their resignation, nor was the grievance procedure invoked by the employer.
The Employment Tribunal (ET) initially found that the employer's failure to follow the ACAS Code meant an uplift to the employee's compensation was warranted. However, the EAT overturned this decision. The EAT ruled that the ACAS Code, by its very wording, only applies when an employee has actually raised a grievance or when an employer is contemplating disciplinary action. In this instance, as no formal grievance had been raised by the employee, and the employer was not initiating disciplinary proceedings, the Code was deemed inapplicable.
This judgment provides significant clarity on the practical application of the ACAS Code. It reinforces the importance of formalising grievances for employees who wish to rely on the Code's protections and potential uplifts in compensation. For employers, it suggests that the Code may not automatically apply during informal 'without prejudice' discussions unless a formal grievance procedure is explicitly triggered.
The ruling underscores the delicate balance between informal resolution attempts and formal dispute procedures in the workplace. While 'without prejudice' conversations are designed to facilitate open discussion without fear of admission, this case highlights that they do not automatically trigger the requirements of the ACAS Code unless a formal grievance is actively pursued or disciplinary action is under consideration.