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Why your business needs to follow the Acas Codes

Recent employment tribunal cases have highlighted the importance of employers following the Advisory, Conciliation and Arbitration Service (Acas) Code on disciplinary and grievance procedures.

One notable example involves Nina Chung, a former employee of Whisky 1901, who won over £50,000 in compensation after successfully claiming sex discrimination and victimisation.

One of the key reasons her award was so substantial was the company’s failure to follow the Acas Code, which led to an uplift of over £7,000.

So, what can business owners learn from this case, and why is compliance with the Acas Code so important?

What is the Acas Code?

The Acas Code sets out the best practices for handling disciplinary and grievance procedures in the workplace.

It is not legally binding, but employment tribunals are required to take the Code into account when deciding cases.

If a business fails to follow the guidelines, an employment tribunal has the power to increase compensation by up to 25 per cent in favour of the claimant.

Lessons from the Whisky 1901 case

In Chung’s case, the tribunal found that Whisky 1901 had unreasonably failed to comply with the Acas Code in the below ways:

Unfair disciplinary process

Chung was suspended for five months and disciplined without a hearing that followed due process.

The company CEO imposed a 12-month written warning when a six-month recommendation had been made.

These actions were seen as disproportionate and unfair, contributing to the tribunal’s decision to penalise the company.

Failure to follow grievance procedures

When Chung raised concerns about sexist language and discrimination, the company failed to adequately investigate or respond to these grievances in line with Acas’ recommendations.

The lack of proper procedures in addressing her complaints further bolstered her case.

As a result of these failings, the tribunal applied a 20 per cent uplift to her compensation, demonstrating how costly non-compliance with the Acas Code can be.

Why following the Acas Code matters

Business owners should make sure they handle all disciplinary and grievance procedures in line with the Acas Code.

Properly following the Acas guidelines reduces the likelihood of a tribunal claim being brought against your business.

If disputes are handled correctly from the outset, employees are less likely to escalate issues to a legal level.

Minimised financial penalties

As seen in the Chung case, non-compliance can lead to financial penalties.

Tribunals can increase compensation awards by up to 25 per cent if they find that the employer did not follow the Acas Code, which can drastically increase costs for the business.

Improved workplace relations

Following best practices creates a culture of fairness and transparency, which can help prevent workplace disputes from arising in the first place.

Employees are more likely to trust the process if they feel their concerns are taken seriously and handled impartially.

Legal protection

Should a dispute escalate to a tribunal, being able to demonstrate that your business followed the Acas Code can strengthen your defence.

It shows that you have taken reasonable steps to handle the issue appropriately and in line with accepted guidelines.

Practical steps for business owners

To avoid the costly mistakes made in the Whisky 1901 case, business owners should take proactive steps to ensure they are compliant with the Acas Code:

Train your managers – Ensure that those in supervisory or management positions are fully trained on the Acas Code and understand how to handle disciplinary and grievance procedures fairly and consistently.

Keep procedures up to date – Review your company’s disciplinary and grievance policies often to make sure they are in line with Acas’ recommendations.

Act fairly and consistently – When dealing with disciplinary or grievance matters, follow your procedures consistently for every employee, regardless of their position or the nature of the issue.

Document everything – Keep detailed records of all steps taken during disciplinary and grievance proceedings, including meetings, investigations, and decisions made. This can be vital evidence if a tribunal claim is brought.

If you are unsure whether your procedures comply with the Acas Code or need assistance in reviewing your policies, our team of legal experts is here to help.

Contact us today to discuss how we can protect your business and ensure you are following best practices.

Amanda Hyam

Head of Dispute Resolution and Employment

I have specialised in Dispute Resolution, Civil Litigation and Employment law for more than 15 years. I understand how daunting the prospect of litigation can be and because of this I am always available to discuss concerns.