Key takeaways
Informal resolution takes centre stage
Employers should address concerns early wherever possible.
Code applies more broadly
New guidance extends beyond employees to workers.
Non-compliance carries significant risk
Compensation awards may change by up to 25%.
Acas recently published a fully revised draft Code of Practice on Disciplinary and Grievance procedures (Revised Acas Code), together with a consultation on the same.
As with the current version, once the Revised Acas Code is brought into force (date TBC), a failure to follow its requirements may result in compensation being reduced or uplifted by up to 25%.
The consultation notes that ’concerns and disagreement are a natural part of working life’ and these can result in either ’escalation or resolution’. Acas therefore wishes to start a conversation about ’how we can disagree better at work’ and suggests that its proposed revisions to the Acas Code are about ’fixing the friction’.
The consultation proposes substantial changes to the Acas Code. Firstly, the proposed Revised Acas Code is broader, referring to ’workers’ as opposed to ’employees’. This reflects the fact Acas considers it good practice for employers to follow the Acas Code in relation to both workers and employees, although the power to adjust compensation for failure to comply is only available in respect of employees.
In summary, key themes emerging from the Revised Acas Code include:
New major emphasis on informal resolution
Perhaps most notably, the Revised Acas Code places far more weight on employers and workers taking proactive steps to try to resolve their ’concerns’ informally wherever possible. The Revised Acas Code’s use of the phrase ’concerns’ when discussing informal resolution, as opposed to ’disciplinary’ and ’grievance’ issues when discussing formal processes, seems deliberate and perhaps reflects the current backlog resolving employment disputes within the employment tribunal.
While the current Acas Code does contain wording which encourages the informal resolution of workplace disciplinary and grievance issues, as this wording is in the foreword it is voluntary and a failure to comply cannot result in a compensation uplift or reduction.
In contrast, the Revised Acas Code includes new sections on ’Resolving employer concerns at work informally’, which focuses on concerns about misconduct or unsatisfactory performance, and ’Handling worker concerns informally’. In both these sections, the emphasis is on raising concerns informally, ideally within the course of the ’everyday working relationship’ (eg as part of ’a routine meeting’), so they can be resolved more quickly. The inclusion of these informal resolution sections within the main body of the Revised Acas Code means that compensation adjustments of up to 25% in either direction will be available to an employment tribunal if either party fails to comply.
In the context of resolving worker concerns raised informally, the Revised Acas Code confirms that these should be taken seriously and addressed without unreasonable delay. When the Revised Acas Code is brought into force, this means line managers should not tell workers that they need to raise a formal grievance because this is likely to be a breach of the Code attracting a compensation uplift. The Revised Acas Code suggests it is good practice for employers to ’provide training and support to help managers, workers and representatives build the skills and confidence needed to resolve concerns early and effectively’.
In the context of resolving employer concerns about misconduct or performance, the Revised Acas Code makes it explicitly clear that:
there is no statutory right to be accompanied at an informal meeting about conduct or performance, although this may be allowed under the employer's own procedure or to avoid discrimination
’an informal conversation should never by itself result in a formal disciplinary warning or other formal disciplinary action’, because any decision about formal disciplinary action should only be taken following a formal disciplinary meeting at which the worker has the right to be accompanied
an informal approach will not be appropriate in every situation (eg if there are concerns about gross misconduct) and sometimes a formal disciplinary process will be the most suitable avenue and
while any informally agreed actions may be confirmed in writing, this should not be subsequently treated as a formal warning.
Both workers submitting formal grievances, and employers inviting workers to attend formal disciplinary meetings, must set out the steps that have already been taken to resolve the matter informally or the reason why no steps have been taken.
Mediation and facilitated conversations
The Revised Acas Code mentions the possibility of mediation or a facilitated conversation throughout and includes a new section on this. Mediation and facilitated conversations involve appointing an independent third party, who should be an accredited mediator or trained facilitator. This could be someone external or who is trained and independent within the employer’s organisation. Mediation or a facilitated conversation may be suggested by either side, at any stage. These processes are voluntary, confidential and any outcome is non-binding. The formal disciplinary or grievance procedure should be paused for the duration of the mediation process. However, the Revised Acas Code recognises that mediation and facilitated conversations may not be suitable in all situations, including where a factual decision is needed about statutory rights.
Avoiding discrimination
The Revised Acas Code expressly refers to the Equality Act 2010 and, in particular, the obligation on employers to make reasonable adjustments on account of disability. Employers are reminded of the need to take this into account throughout the disciplinary and grievance lifecycle, but especially in relation to allowing workers to be accompanied at meetings (both informal and formal).
Suspension
The Revised Acas Code contains a new section on suspension, which lists the limited circumstances in which suspension may be appropriate and notes the significant effect suspension can have on working relationships and the people involved.
Artificial Intelligence: the missing link
Employers, who are keenly aware of the impact this issue is having at the coal face, may be surprised to find that the Revised Acas Code makes no express mention of the use of Artificial Intelligence (AI) by workers. However, the consultation does seek views on whether this issue should be addressed in guidance.
Next steps
The consultation ends on 23 September 2026, following which the Revised Acas Code, subject to any amendments which result from the consultation process, will be laid before parliament for approval. We do not have an estimated date for the Revised Acas Code to come into force. Perhaps this may coincide with unfair dismissal changes being brought into force on 1 January 2027?
If you have any questions about how the Revised Acas Code may affect your business, or need support with any employment matter, learn more about our Employment expertise or contact us today to discuss how we can help.
