Fairness in disciplinary process

Your responsibilities

You must act fairly when conducting a disciplinary process. This means you must act reasonably and use a fair procedure. To minimise potential liability for unfair dismissal, you should have (and use) a comprehensive written disciplinary policy.

If you don't, a dismissed employee could challenge their dismissal at an Employment Tribunal.

Acting reasonably

Once you've shown that a dismissal was for a permitted reason, the tribunal must then decide whether you acted reasonably in coming to that decision. The fact that a dismissal is a breach of contract will not in itself make it unfair. The test is whether you acted reasonably.

The tribunal will have to consider each case on its own facts. There are a few principles they must follow in determining reasonableness:

• It must consider whether the dismissal was obviously fair or unfair. E.g. was there a reasonable alternative to dismissal, such as a final warning, suspension or demotion?
• It will then consider whether you acted reasonably or unreasonably in all the circumstances. This involves deciding if your decision was within a range of reasonable responses that an employer in your situation might make. One employer might reasonably take one view, and another may reasonably take another view, but as long as the dismissal falls within the range of potential reasonable responses, it'll be deemed fair. Otherwise, it'll be regarded as unfair.

When judging the reasonableness of your conduct, the tribunal must not decide based on what it would have done in the circumstances. It can consider the size and administrative resources of your business. For example:

• If you have a small workforce, you may find it more difficult than a larger firm to find other employees to do the work of a particular employee if they have been absent through sickness for a long time. This might justify the employee's dismissal and replacement in circumstances where a larger firm would not be acting reasonably.
• A small business is less likely to have suitable alternative employment if a job is lost through redundancy.

Fair procedure

Even if you're justified in dismissing your employee, the dismissal may still be unfair if there are procedural defects. Examples of this include where an employee is dismissed for misconduct without being given an opportunity to explain their actions, or is made redundant without any consultation.

Employers in England, Wales and Scotland must use the Acas Code of Practice in circumstances of misconduct and capability, but not for other reasons, such as redundancy.

For employers in Northern Ireland, see the Labour Relations Agency's Code of Practice on Disciplinary and Grievance Procedures.

Failing to comply with either code of practice may result in an Employment Tribunal increasing an employee's compensation by up to 50%.

A fair procedure will involve the following:

• Informing your employee of the allegation in writing
• Asking them to attend a meeting to discuss it (to which they have a legal right to bring a colleague or trade union representative)
• Giving them with an opportunity to explain their position
• Conducting an investigation into allegations
• Allowing the employee to exercise their legal right to appeal your decision.

If you have not followed a fair procedure, it is no defence (except in exceptional circumstances) for you to argue that it would have made no difference to the decision to dismiss your employee had proper procedures been followed. But it may be a relevant factor in assessing the amount of compensation that the employee is entitled to.

Aspects of the procedure may differ depending on the reason for the potential dismissal.

Misconduct

Generally, the more serious the alleged misconduct, the more care and time you should take when dealing with it. For example, if the misconduct is proven and dismissal is likely to mean the employee won't find another job in their field, you should ensure that a thorough investigation is done before deciding.

The Acas code recommends the following sanctions for disciplinary action:

• Oral and/or written warnings
• A final written warning
• Dismissal (or sanction example suspension)

Choosing the wrong sanction can result in an unfair decision. To minimise potential liability for unfair dismissal, your disciplinary policy should set out examples of what conduct will amount to serious and gross misconduct. See the section on Disciplinary penalties for more information.

If the misconduct was minor, you should usually consider giving an oral or written warning. For more serious misconduct or repeated cases of misconduct, it may be appropriate to move straight to a final warning. In cases of gross misconduct, it can be appropriate to dismiss without warning.

Note: In most cases of dismissal for misconduct, the terms of an employee's contract will decide whether they must work their notice or can be paid in lieu of working it. However, in the case of gross misconduct, you can terminate their contract without them having to work their notice or be paid in lieu. See the section on Disciplinary penalties for more information.

In cases where you only suspect that your employee has committed gross misconduct (i.e. where you can't prove it), you may still have acted fairly by dismissing them. A tribunal will need to be satisfied that you carried out a proper investigation and relied on it to come to a genuine and reasonably held belief (that was also within the range of reasonable responses) of their guilt.

Criminal offences

If an employee is subject to a police investigation or is charged or convicted of criminal misconduct outside of work, it may still be appropriate for you to start an investigation and take disciplinary action against them - but you should not rush into doing this and treat it as any other form of potential misconduct.

You should first consider if it's appropriate for you to get involved and start an internal investigation. This means considering if there could be employment implications (which may require obtaining more information about the alleged offence from the police beforehand):

• How serious is the offence? Will it have a bearing on the nature of the employee's job? (e.g. do they have a public-facing role? Do they hold a senior role or a position or trust?)
• What is the impact on work colleagues and customers (particularly their safety)?
• What is the reputational risk to the business?

If you decide it will be appropriate to investigate:

• First discuss your disciplinary process with the police and check if you can use it without prejudicing any criminal process.
• If you can use it, carefully consider whether it would be reasonable in the circumstances to wait for the outcome of the criminal process (which could take several months or even years to complete) or start an investigation immediately.

Note: The Acas guide to discipline and grievances at work (which applies to employees in England, Wales and Scotland) states that where the matter requires prompt attention the employer need not await the outcome of the criminal prosecution before taking fair and reasonable action.

You may decide to suspend your employee pending the decision of the criminal court. However, if they are remanded in custody or subject to restrictive bail conditions, you won't usually need to suspend the employee as they can't attend work anyway (if an employee is not ready and willing to work, they're not entitled to be paid).

Where they are charged with or convicted of a criminal offence, and the employee refuses or is unable to cooperate with a disciplinary investigation and proceedings, it shouldn't deter you from making a decision. The employee should be advised in writing that, unless further information is provided, a disciplinary decision will be taken based on the information available and could result in their dismissal.

Where a criminal conviction leads, for example, to the loss of a licence that would mean continued employment in a particular job would be illegal, consider whether alternative work is appropriate and available.

Off-duty conduct that has no bearing on the employee's employment might not justify disciplinary action. However, if the employee won't be available to work because they're in custody or on remand, you should consider if the business can continue to run if you keep their job available for them. If there's little chance of them returning to work, although there might be an argument that the employment contract will end automatically, it's normally better for you to start the disciplinary process and take disciplinary action.

Redundancy

The redundancy procedure used by an employer must be reasonable and fair, or else the redundancy could be deemed unfair dismissal.

What amounts to a fair procedure will depend on the particular circumstances of each case. However, you should do the following before deciding which procedure to follow:

• Check the employee's contract and/or any staff manual/handbook in case these set out any procedural steps when contemplating making redundancies. You may be bound by contract to follow the procedure and should only depart from it with the written agreement of the affected employees.
• Check whether you have historically used a particular procedure, which remains fair and up to date, that should be applied to the employees. You can depart from using this procedure if it would be reasonable to do so.

For you to act reasonably, you must, for example:

• Warn and consult with any employees who may be affected and/or their representatives
• Take reasonable steps to avoid or minimise redundancies
• Adopt a fair basis to select employees for redundancy.

For a fuller list of obligations see the section on Consultation before redundancy.

Acting Illegally

If it becomes illegal for either your employee to work in their role, or for you to continue to employ them in their position, a dismissal may well be fair.

However, you should consider whether it is possible to employ them elsewhere. For example, your employee is a driver and is now unable to drive/perform their job because of disqualification by a court. It may be possible to utilise them elsewhere in the business and you should take steps to search for another role before dismissing them.

Capability

Dismissals on the grounds of capability are based on the employee not doing their job properly, and can cover situations like not having the right qualifications, not performing to the required standard (incompetence), or being unable to work because of frequent or long-term illness.

Before dismissing your employee for incompetence, you should normally have warned them about the standard of work and given them the opportunity to improve. Where appropriate, you should provide adequate training. For example, where your employee has been moved to a job beyond their capabilities, you should consider whether it is possible to move them to a job within their capabilities.

In cases of long-term illness, it may be fair to dismiss your employee. The nature and likely duration of the illness and the length of service will be relevant, as well as the business needs and requirements. Ultimately, the test is whether you could reasonably be expected to wait any longer for the employee to return to work.

It is advisable to consult with your employee about the nature and likely length of their illness. You should seek medical advice relating to their condition and consider whether suitable alternative employment can be offered. You will, however, require written consent from your employee before you can obtain any medical reports from a specialist or doctor.

In the case of permanent disability, the contract may become frustrated - this is a legal term describing a situation where a change in circumstances makes it impossible for a contract to be fulfilled (through no fault of either party). In this context, it means the employment contract simply ends and, technically, there is no dismissal. However, employers are expected to explore all the available options before relying on this to end an employment.

Retirement

Ending employment due to retirement can be a dismissal under a category known as some other substantial reason.

For most workers there is no default retirement age, meaning that they are entitled to work for as long as they want without being forced to retire once they reach a specific age.

However, it is still possible for employers to lawfully require an employee to retire at a specified age, if the chosen age can be objectively justified. Otherwise, you will almost certainly be liable for direct age discrimination under the Equality Act.

People must now work for longer before they can retire and you should check the current state pension age.

The law regarding the legal use of a compulsory retirement age is complex. Businesses are required to prove that its use is justified as being a proportionate means of achieving a legitimate aim.

This legal test can generally be broken down as follows:

1. What aims are currently recognised by the law?

2. Are the business's chosen aims actually relevant to the retirement?

3. Is the business pursuing the aims?

4. Is the compulsory retirement age appropriate and necessary considering the nature of the business?

5. Is there any other suitable option available to the business?

What aims are currently recognised by the law?

Relevant decisions have been made by the courts. They specify that pursuing 'social or public interest objectives' will be legitimate aims when imposing a compulsory retirement age on an employee. Examples of these aims include:

• Facilitating access to employment for young people
• Enabling older people to remain in employment
• Sharing limited opportunities in a particular profession between generations
• Ensuring a mix of generations to promote the exchange of experience and new ideas
• Cushioning the blow for long-serving workers who may find it hard to find new employment
• Preserving the dignity of older employees by avoiding the need to dismiss them due to capability.

The following could also be social or public interest objectives that would constitute legitimate aims:

• Rewarding experience
• Health and safety concerns for members of the workforce or the general public.

The courts will require a business to consider whether there are any other non-discriminatory options available for it to achieve its social or public interest aims. These might include the use of appraisals to identify underperformance and/or using existing policies for managing employee capability.

If you do decide that it is justified to have a compulsory retirement age, it is not recommended to force retirement before the state pension age as it may be regarded as unfair and contrary to public policy. Note also that selecting a single retirement age may not be right for all employees in your business (particularly if the roles within your business differ).

If an employee challenges the lawfulness of being required to retire at a specified age, the employer will need to provide evidence that it was objectively justified. This may prove hard to do as the age may have been fixed many years before the employer has tried to enforce the requirement to retire. If they are not successful, employers may also become liable to pay damages for unfair dismissal and/or unlawful age discrimination.

Acas advises employers to write down their reasons for requiring an employee to retire at a particular age, consider whether they have good evidence to support their reasons and then consider if the same result could be achieved using an alternative or non-discriminatory way. It also advises that employers should encourage employees to have more open discussions about their future plans.

Acas also recommends that before enforcing a fixed retirement age, an employer should give the employee adequate notice of their impending retirement and consider whether they will be permitted to apply to stay beyond the compulsory retirement age.

Employers must use a fair procedure when dismissing any employee, including when dismissing employees once they have reached a compulsory retirement age.

If you are unsure whether or not you can justify requiring the employee to retire at a particular age, then you should seek legal advice.

Other substantial reasons

Some reasons may be fair due to the existence of a contractual term. For example: an employer moves premises and requests that their employees travel a reasonable distance to the new offices. A term in their contract states that they may be asked to move to a new workplace that's within a certain distance of the old one. If an employee decides to refuse to travel because it's less convenient for them, the employee's dismissal can be reasonable because of the term in their contract that permits it.