What are the pros and cons of making a disciplinary procedure contractual?
If an employer makes a disciplinary procedure contractual, it will be able to require employees to cooperate with the procedure, as a refusal by an employee to take part will amount to a breach of contract. It will also assist in providing certainty for both the employer and the employee, ensuring that both parties are aware of their rights and obligations relating to the procedure.
One of the main disadvantages to the employer of having a contractual disciplinary procedure is that it will not be easy for the employer to change it. A change to the procedure would require a change to each employee's contract. The employer would therefore have to consult with the employees and seek their consent to the variation. Where the employees did not agree to the changes, the employer could dismiss them and re-engage them under new contracts, but in doing so would risk claims for unfair dismissal.
Another disadvantage is that, where a contractual disciplinary procedure exists but the employer does not follow it, the employer will be in breach of contract. An employee dismissed on disciplinary grounds where the employer has failed to follow its own contractual disciplinary policy could bring a claim for wrongful dismissal (ie dismissal in breach of contract), although damages for such a breach would be limited to payment for the notice period and for the time it would have taken to carry out the contractual disciplinary procedure. The ability to bring a breach of contract claim would benefit an employee who does not meet the eligibility requirements for bringing a claim for unfair dismissal. If the procedure is not contractual, the employee would be able to argue only that a failure to follow the procedure should be taken into account in an unfair dismissal claim.