New Way to Settle Workplace Disputes

The Employment Act 2008 will introduce new laws with regard to the settlement of workplace disputes.

The change follows an independent review, carried out by Michael Gibbons, a member of the Department for Business, Enterprise and Regulatory Reform’s Better Regulation Commission, of the workings of the statutory dispute resolution procedures, which were introduced in October 2004. The procedures were intended to reduce the number of Employment Tribunal (ET) claims, but the review found that they had led to workplace disputes becoming formalised, with lawyers becoming involved at an earlier stage in proceedings than had previously been the case. They are therefore to be replaced and instead there will be a revised voluntary Advisory Conciliation and Arbitration Service (ACAS) Code of Practice supported by non-statutory guidance aimed at encouraging employers and employees to resolve issues both earlier and informally.

The Employment Act will:

  • repeal the existing statutory dispute resolution procedures and related provisions dealing with procedural unfairness in dismissal cases;
  • confer on ETs discretionary powers to increase or decrease awards by up to 25 per cent if parties have failed reasonably to comply with a relevant statutory code;
  • amend ETs’ powers by which they may reach a determination without a hearing;
  • allow ETs to award compensation for financial loss in certain types of monetary claim; and
  • make changes to the law relating to conciliation by ACAS, removing the fixed periods for conciliation.

These provisions are due to come into force in April 2009.

Mr Gibbons has said that he is very happy with how the Act is worded but warned that it may still not achieve its aim of reducing the number of hearings before the ET. It will be necessary for mediation bodies to promote themselves properly to make sure employers and employees are comfortable turning to them in the event of a dispute rather than going to the ET.

Aston Bond says, "Employers are reminded that until the law is changed, they must follow the existing statutory dispute resolution procedures when dismissing staff and handling grievances."

The ACAS Code of Practice can be found at http://www.acas.org.uk/CHttpHandler.ashx?id=961&p=0.

A new guide, Mediation: An Employer’s Guide, has been published by ACAS and the Chartered Institute of Personnel and Development.

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