In addition, employers have a duty not to behave in such a way which would destroy the relationship of trust and confidence between the parties. Failure to deal with a grievance could constitute a breach of this duty following which the individual may resign and bring a claim of constructive dismissal.

Further obligations were placed on employers and employees with the introduction of the statutory grievance procedures in October 2004. When an employee wants to complain about the action an employer has taken, or contemplates taking in relation to them, the statutory grievance procedures must be followed: Step 1 the employee must set out the grievance in writing and send it (or a copy) to the employer; Step 2 a meeting must be arranged to discuss the grievance; Step 3 if the employee wishes to appeal the decision reached he must inform the employer.

The statutory grievance procedures have resulted in a great deal of litigation and on occasions it is difficult for employers to establish whether or not a grievance has in fact been raised and what the appropriate response should be. This is illustrated by the recent Court of Appeal decision in Towergate London Market Limited v Harris.

Court of Appeal decision

Mrs Harris was employed as an insurance broker and was made redundant on 31 October 2005. She did not appeal that decision as she believed the selection process had been properly applied. However, at her leaving party, she heard rumours that she had been "stitched up". Mrs Harris and her trade union representative then met with Towergate who agreed to provide her with information on her selection for redundancy, which they did on 5 January 2006. On 25 January Mrs Harris wrote to Towergate stating "I wish to raise a formal grievance…on the ground that I believe the assessment criteria used to make me redundant was unfair and inaccurate".

The ordinary 3 months time limit for bring an unfair dismissal claim expired on 30 January. Towergate wrote to Mrs Harris on 31 January advising that, as she had left their employment, they were not going to deal with her grievance.  She then brought an unfair dismissal claim on 29 April which was well outside the ordinary time limit.

At a preliminary hearing at the Employment Tribunal, Mrs Harris argued that, her "formal grievance" was in reality an appeal from her dismissal and it was her reasonable belief that a dismissal procedure was being followed by Towergate. Accordingly, her claim was not out of time as regulation 15(2) (Dispute Resolution Regulations) applied and extended the time limit by three months because of her reasonable belief. The Employment Tribunal disagreed and held she had not appealed under the dismissal procedure rather, she had raised a grievance and her claim was out of time.

Mrs Harris successfully appealed to the EAT which held that on 30 January (the expiry date for entering a claim), Mrs Harris had "reasonable grounds for believing that a dismissal procedure, whether statutory or otherwise, was being followed". Mrs Harris had clearly entered into a procedure whereby, she was trying to resolve the issue of her redundancy dismissal. The time limit was extended and Towergate appealed to the Court of Appeal.

By a majority, the Court of Appeal agreed with the EAT. Regulation 15(2) required that, when the ordinary time limit for presenting a claim expired, an Employment Tribunal had to ask itself two questions:

• Did the employee have a reasonable belief that a dismissal or disciplinary procedure, whether statutory or otherwise, was being followed?
• If so, were there reasonable grounds for that belief?

Whether or not such a procedure was actually being followed is not the test.

The Employment Tribunal should not have focused on whether Mrs Harris’s letter of 25 January was an appeal or a grievance. The issue was simply whether Mrs Harris reasonably believed that a dismissal procedure of some kind was being followed. She had sent a letter contending her dismissal had been unfair and had started this procedure with a view to resolving the issue of the fairness of her redundancy dismissal. She had reasonable grounds to believe a dismissal procedure was being followed and the EAT had been entitled to find that regulation 15(2) had applied to extend the time limit for bringing a claim. The Court of Appeal stated that an unduly legalistic or technical approach to the application of the Regulations was to be avoided and, whilst to an employment lawyer there is a distinction between a grievance and an appeal, "one does not expect an employee to have a ready grasp of these arcane mysteries."

The practical lesson to be drawn from this decision is that employers should not disregard an employee’s letter of complaint or to take at face value what sort of letter it is expressed to be. Employers should give careful consideration to the purpose of the letter in order to deal with it properly. 

Looking ahead

As mentioned in e-bulletin number 2 (December 2007) the statutory dispute resolution procedures are being repealed in their entirety in April 2009 as they have failed to meet one of their key objectives, a reduction in the number of Employment Tribunal claims. The Acas Code of Practice on discipline and grievance will be revised to take account of the repeal and a revised draft Code was issued for consultation in May. The consultation period ends on 25 July. The revised draft Code is shorter than the current Code and sets out the well established principles for dealing with grievances in the workplace:

• Let the employer know the nature of the grievance and this is best done in writing
• Hold a meeting promptly with the employee to discuss the grievance
• Allow the employee to be accompanied at the meeting
• Decide on the appropriate action
• Allow the employee to take the grievance further if not resolved
• Special cases - consider dealing separately with issues involving bullying, harassment or whistleblowing.

In June, Acas published comprehensive draft guidance to complement the revised Code. This includes, for example, guidance on how to prepare for the grievance meeting and how to conduct it, as well as sample disciplinary and grievance procedures and letters. The draft guidance can be accessed on www.acas.org.uk.