Employment tribunals have long judged employers on whether they followed a fair disciplinary or grievance process. That yardstick is about to shift.
ACAS has launched a consultation on a brand-new Code of Practice on Disciplinary and Grievance Procedures. It’s the first full rewrite of the Code since 2009, and it puts early, informal resolution front and centre, rather than treating it as a footnote to the formal process.
Here’s everything you need to know, and the practical steps worth taking before the final Code lands.
Why is ACAS rewriting the Code now?
The trigger is cost. ACAS estimates that formal disciplinary and grievance procedures cost UK employers approximately £2.36 billion every year, and its research suggests many of those disputes could be resolved earlier, and far more cheaply, through informal conversations, mediation and early intervention.
Employment tribunals already take the ACAS Code into account when deciding whether a dismissal or grievance process was handled fairly, and a failure to follow it can move compensation up or down by as much as 25%. If this draft is adopted, that same yardstick will be applied to a noticeably different set of expectations.
What’s actually changing under the draft Code?
The current Code focuses almost entirely on the formal process: how to investigate, how to hold a hearing, how to handle an appeal. The draft Code keeps all of that, but adds real weight to what happens before a formal process even starts.
- Early, informal resolution becomes an expectation, not a footnote. Employers will be expected to engage with concerns promptly, have a genuine conversation with the worker involved, and explore training, support, reasonable adjustments or mediation before moving to a formal process.
- New principles for handling concerns at work. Employers and workers are both expected to address issues promptly, communicate openly, and prevent unnecessary escalation. Employers must establish the facts, act reasonably, and give the worker a genuine chance to respond.
- Equality Act obligations get their own section, for the first time. This covers accessible meeting venues, documents in alternative formats, interpreters, and support workers attending meetings. Employers need to think about this from the outset of a case, not add it on afterwards.
- Mediation moves centre stage. Mediation and facilitated conversations get their own dedicated section. Mediation can be proposed at any stage, and where both sides agree, the formal process should generally pause while it takes place.
- Suspension comes under closer scrutiny. Suspension should be used only where genuinely necessary, to protect an investigation, the business, other workers, or a legal compliance obligation.
- ‘Worker’ replaces ‘employee’ throughout. This reflects ACAS’s view that good practice should extend beyond those with full employment status, though it may create some confusion given the different legal protections each status carries.
When does the new Code come into effect?
The consultation opened on 30 July 2026 and closes at 11.59pm on 23 September 2026. ACAS will consider the feedback it receives and may revise the draft before presenting it to the Secretary of State. If approved, the updated Code will be laid before Parliament.
There’s no confirmed date for the Code coming into force yet, but businesses should treat the consultation period as the window to prepare, not wait for the outcome. We will communicate the outcome to our clients.
Why does this matter, especially for SMEs?
Most compliance problems don’t come from big, obvious mistakes. They come from the everyday stuff: a manager who jumps straight to a formal letter instead of having a conversation, a grievance process with no mediation option, or reasonable adjustments that only get considered once things have already escalated.
For SMEs, this matters more than it might for larger organisations. There’s often no dedicated HR or legal function, and disciplinary and grievance matters fall to whoever has capacity, whether that’s a founder, an office manager, or a small HR team covering a lot of ground. Under the new Code, it’s exactly this kind of everyday practice that tribunals are likely to scrutinise more closely.
What should employers do now?
The new Code hasn’t landed yet, but the direction of travel is clear. For most businesses, getting ahead of it is less about learning new legislation and more about getting your processes, and your managers, ready.
- Review your disciplinary and grievance policies against the direction of travel in the draft Code.
- Build informal resolution and mediation options into your process, not just your paperwork.
- Refresh manager training so line managers know how, and when, to have an early conversation.
- Check your approach to reasonable adjustments is built in from the first conversation, not added on later.
- Tighten up your approach to suspension, so it’s only ever used where it’s genuinely necessary.
Not sure how your current policies would hold up against the new Code? Speak to the HRCentral team and we’ll review your disciplinary and grievance procedures, flag the gaps, and set out exactly what to do next, before the final code lands.
For support, please contact us or email enquiries@hrcentral.co.uk
