Blog: Friday 26th July 2024 - Weightmans, Corporate Partner

NEW: Code of Practice on Dismissal and Re-Engagement

Radhika Aggarwal, a Principal Associate at Weightmans considers the effects of the recently introduced Code below.

As the plethora of employment law changes cascade into real working life, we saw the Code of Practice on Dismissal and Re-engagement (“the Code”) issued by the Secretary of State under section 203 of TULR ( C) A 1992 come into force on the 18 July 2024.

Following stages of informing and consultation, if parties are unable to agree changes to employment terms and conditions by agreement, then to dismiss and re-engage employees is an option. However, to ‘fire and re-hire’ is the option of last resort when it comes to changing employee terms and conditions, and if undertaken incorrectly could be a costly mistake particularly for larger employers. This maybe even more significant if and when day 1 rights to unfair dismissal crystalise.

The aim of the new Code is to provide practical guidance to help employers, the unions and employees in avoiding, managing and resolving industrial relations conflict and dispute. It underscores the importance of open and transparent information-sharing and consultation by employers who are proposing changes to their employees’ terms and conditions.  It is designed to ensure that employers explore alternatives to dismissal and engages in meaningful consultation with a view to reaching an agreed outcome with employees and their representatives. The Code also seeks to ensure that the employer does not raise the prospect of dismissal unreasonably early or put undue pressure on employees by threatening dismissal where this is not, in fact, envisaged. Employers need to think about and re-examine what they are doing and its consequences, it is not a process to rush through.

A failure to follow the Code does not, in itself, make a person or organisation liable to proceedings, but the Code is admissible in evidence in proceedings before a court, employment tribunal or CAC, and any provision of the Code which is relevant to the proceedings must be taken into account before a decision is made.

And if that’s not all, similar to the ACAS Code on Grievance and Disciplinary Procedures, if an employee brings one of the employment tribunal claims listed in Schedule A2 to the 1992 Act, and the claim concerns a matter to which this Code applies, then the tribunal can either:

• increase any award it makes by up to 25%*, if the employer has unreasonably failed to comply with the Code

• reduce any award by up to 25%, where it is the employee who has unreasonably failed to comply.

*The uplift does not apply to protective awards for failure to inform and consult in collective redundancy situations.

So, while the Code helpfully provides a best practice framework in addition to existing obligations for the employer, the consequences of error could also be even more costly. Those in the employment law and HR sphere in local government should take some time to review the decision-making processes, the contents of internal briefing notes and the factors to be included, review any related HR policies and standard template s188 notices and letters.

Radhika Aggarwal, Principal Associate at Weightmans (Radhika.aggarwal@weightmans.com)