Acas Code Does Not Apply to Ill-health Dismissals

The Employment Appeal Tribunal has confirmed that the Acas Code of Practice on Disciplinary and Grievance Procedures does not apply to dismissals for ill-health.

Speedread 

The Acas Code of Practice on Disciplinary and Grievance Procedures (the Code) does not apply to dismissals for ill-health. The employment tribunal had therefore been correct to refuse to award increased compensation for failing to follow the Code. The Code applies to any situation in which it is alleged there is culpable conduct on the part of the employee. Where poor performance is due to genuine illness or injury, there is no culpability. Disciplinary action is not appropriate in such cases and the Acas Code does not apply.

Facts

In Holmes v Qinetiq Limited, Mr Holmes was dismissed on grounds of ill-health on 17 April 2014 on the basis that he was no longer capability of doing the job of a security guard. This followed extensive absences as a result of pain in his back, legs and hips. His employer admitted that his dismissal was unfair as it had failed to obtain an up to date occupational health report about his ability to provide reliable attendance following an operation in April 2014 that effectively resolved the pain he had been experiencing. 

At the remedies hearing, the employment tribunal ruled that the Code does not apply to ill-health dismissals and it therefore refused to increase compensation for failing to follow the Code. Mr Holmes appealed. 

Decision

The Employment Appeal Tribunal (EAT) noted that the Code states that it applies to disciplinary situations, including misconduct and poor performance. However, the EAT considered that it is not limited to cases involving misconduct or poor performance. It is clear that the Code is intended to apply to any situation in which an employee faces a complaint or allegation that may lead to a disciplinary situation or to disciplinary action. This infers that there must be culpable conduct, whether in the form of misconduct, poor performance or something else, that requires either correction or punishment. 

Where poor performance is due to genuine illness or injury, there is no culpability and disciplinary action is not appropriate. The Code does not therefore apply. The position is different where there has been a failure to comply with sickness absence procedures or the employer considers that the ill- health is not genuine. In those cases, the disciplinary procedure is invoked to address the alleged culpable conduct on the employee’s part, rather than any capability arising from ill-health.

In this case, no disciplinary procedure was invoked because, aside from his illness, Mr Holmes was able to perform his job and there was no suggestion had had breached his employer’s rules of conduct or discipline so as to merit disciplinary action or to give rise to a disciplinary situation. The Code did not therefore apply and the employment tribunal had been correct to refuse to increase compensation. 

Implications

If an employer is dismissing an employee because they are unable to perform their role because of ill-health, they should not use the disciplinary procedure. There is no culpability on the part of the employee, it should not be treated as a disciplinary situation and the Code will not apply. If, on the other hand, an employee on sick leave is dismissed because they have failed to follow sickness absence procedures or because their ill-health is not genuine, then this is culpable conduct to which the disciplinary procedure and Code will apply. An unreasonable failure to follow the Code in that situation could result in an uplift in compensation of up to 25%.