Why your business should follow the Acas Codes

Recent employment tribunal cases have shown why it is so important to follow the Advisory, Conciliation and Arbitration Service (Acas) Code on disciplinary and grievance procedures.

A standout case involved Nina Chung, a former employee of Whisky 1901, who was awarded over £50,000 in compensation after successfully claiming sex discrimination and victimisation.

From this reward, £7,000 was due to the company’s failure to follow the Acas Code, resulting in an uplift to her compensation.

This case highlights why compliance with the Acas Code is essential and the serious consequences businesses face if they fail to comply.

What is the Acas Code?

The Acas Code outlines best practices for managing disciplinary and grievance procedures in the workplace.

While it is not legally binding, employment tribunals take the Code into account when ruling on cases.

If a business does not follow the guidelines, the tribunal can increase compensation awards by up to 25 per cent in favour of the claimant.

This makes following the Acas Code a vital consideration for businesses in managing employee disputes.

Lessons from the Whisky 1901 Case

In the case of Nina Chung, the employment tribunal found multiple breaches of the Acas Code by Whisky 1901, including:

  • Unfair disciplinary process – Chung was suspended for five months without due process. She was later issued a 12-month written warning, despite a recommendation for a six-month warning. These actions were deemed disproportionate and unfair.
  • Failure to follow grievance procedures – When Chung raised concerns about sexist language and discrimination, the company failed to properly investigate or respond to these grievances, violating Acas’ recommendations.

These failures resulted in a 20 per cent uplift to Chung’s compensation, illustrating the financial consequences of non-compliance with the Acas Code.

Benefits of following the Acas Code

For businesses, observance of the Acas Code helps avoid tribunal claims and creates a positive and fair workplace culture.

Minimising the risk of tribunal claims

Properly handling disciplinary and grievance procedures from the outset significantly reduces the likelihood of an employee escalating a dispute to a tribunal.

By ensuring fairness and transparency, businesses can resolve issues early, potentially avoiding costly and time-consuming legal battles.

Reducing financial penalties

Failure to follow the Acas Code can lead to increased financial penalties.

As demonstrated in the Whisky 1901 case, tribunals have the authority to increase compensation by up to 25 per cent if they find that an employer failed to follow to the Code.

For businesses, this could lead to substantial financial losses.

Improving workplace relations

When employees feel that their concerns are taken seriously and handled impartially, it helps build trust and prevent disputes from escalating.

Following the Acas Code promotes a culture of fairness, which in turn can improve employee morale and reduce turnover.

Providing legal protection

In the event that a dispute does reach a tribunal, being able to demonstrate that your business has followed the Acas Code strengthens your legal position.

It shows that you have acted reasonably and in line with accepted best practices, providing a good defence against claims of unfair treatment.

Practical steps for compliance

To avoid the costly mistakes seen in the Whisky 1901 case, businesses should take steps to ensure they comply with the Acas Code:

  • Train managers and supervisors
  • Keep policies up to date
  • Ensure fairness and consistency
  • Document everything

By following these steps and ensuring compliance with the Acas Code, businesses can protect themselves from potential tribunal claims, avoid financial penalties, and promote a fairer and more transparent workplace.

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