Updated April 2026. Reflects the ACAS Code of Practice on Disciplinary and Grievance Procedures, the Employment Rights Act 1996 and the Employment Relations Act 1999.
Most UK SMEs treat grievance procedures the same way they treat fire drills — they hope they’ll never need them, and when they do, they realise nothing was actually in place. The result, when an employee finally raises a serious complaint, is a chaotic process that ends up at an Employment Tribunal a year later with the employer paying not just for the substantive issue but for procedural failures along the way.
This guide covers what UK employers must do when a grievance is raised, the ACAS Code that tribunals apply, and the common mistakes that turn a manageable internal issue into a tribunal claim.
Why this matters financially
Tribunals can adjust compensation by up to 25% — either way — for unreasonable failure to follow the ACAS Code of Practice on Disciplinary and Grievance Procedures. So an unfair dismissal award of £40,000 can become £50,000 if the employer didn’t handle the grievance properly, or £30,000 if the employee didn’t follow it. Multiply that by the cost of legal representation, the time absorbed, and the impact on team morale, and procedural compliance is the cheapest insurance an employer can buy.
Beyond the headline number, employers who follow a clear, documented grievance procedure:
- Resolve more issues internally without escalation
- Build a defensible record if a claim is later brought
- Demonstrate fair treatment to the wider workforce
- Reduce the chance of constructive dismissal claims (where the employee leaves citing the employer’s breach of trust and confidence)
What the ACAS Code requires
The ACAS Code of Practice on Disciplinary and Grievance Procedures sets out the steps a tribunal expects. The key principles for grievances:
- Try informal resolution first. Most grievances can be resolved by a quick conversation. Don’t escalate everything.
- If informal doesn’t work, follow a formal procedure. Written grievance, hearing, decision in writing, right of appeal.
- Act consistently. Treat similar grievances similarly — inconsistency is a tribunal red flag.
- Investigate the facts. Don’t decide before you’ve gathered the evidence.
- Allow the employee to be accompanied. Statutory right under section 10 of the Employment Relations Act 1999.
- Decide and explain. The decision must come with reasoning.
- Allow an appeal. Heard by someone not previously involved.
The Code itself is short — about 4,000 words including the disciplinary side. Read it once and the principles are clear.
The standard six-stage process
Stage 1: Informal resolution
The employee raises the issue with their line manager. The manager listens, investigates if needed, and tries to resolve it. Most issues end here. The conversation should be documented (a brief file note is enough) but not formalised unless escalation is required.
Stage 2: Written grievance
If informal resolution fails or the issue is serious, the employee submits a written grievance to the line manager (or HR, or another nominated person if the grievance is against the line manager). The grievance should set out the nature of the complaint, the relevant facts, and the resolution sought.
Stage 3: Investigation
Before the hearing, the facts are investigated. This may mean reviewing emails, interviewing witnesses, looking at policies. The investigation should be proportionate — not every grievance needs a forensic review. The findings should be documented.
Stage 4: Grievance hearing
A meeting is arranged within a reasonable time (typically 5-10 working days from receipt of the written grievance). The employee has the statutory right to be accompanied by a fellow worker or trade union representative — not a solicitor or family member, but those can be allowed at the employer’s discretion.
At the hearing, the employee explains their grievance, the manager asks questions, the investigation evidence is discussed, and the employee says what outcome they want.
Stage 5: Outcome letter
The decision is communicated in writing within a reasonable time (typically 5 working days from the hearing). The letter should set out:
- What was considered
- What findings were made
- What the decision is and the reasoning
- Any actions to be taken
- The right of appeal and how to exercise it
Stage 6: Appeal
The employee can appeal in writing within 5 working days. The appeal is heard by a manager not previously involved (where possible — in a small business this is sometimes hard, in which case explain). The appeal can review the original decision or hold a fresh hearing. The appeal decision is final.
Common UK grievance-handling mistakes
1. Not having a written policy at all. Section 1 of the Employment Rights Act 1996 requires the written statement of employment particulars to refer to the grievance procedure. Many small businesses miss this.
2. Treating the procedure as optional for “trivial” complaints. Once a grievance is raised, follow the procedure even if you think it’s minor — failure to do so can become the substantive issue itself.
3. Pre-judging. Telling the employee “this isn’t going anywhere” before the hearing undermines fairness and is a procedural breach. Listen, investigate, then decide.
4. Refusing the right to be accompanied. Section 10 of the Employment Relations Act 1999 is statutory. Refusal is itself actionable separately.
5. The same person making and reviewing the decision. The appeal must be heard by someone different. In a small business this can be the company director, an external HR consultant, or a non-executive — but it must be different from the original decision-maker.
6. Long delays. “We’re looking into it” for three months without updates is itself a breach. Set timescales and stick to them.
7. Confidentiality breaches. Discussing the grievance with people outside the process can support a separate claim. Limit who knows.
Special situations
Grievance against the line manager. The procedure should specify an alternative person to receive the grievance (HR, another senior manager, the MD). Going to the line manager who is the subject of the complaint is the wrong route.
Grievance during a disciplinary process. Sometimes employees raise a grievance to slow down or undermine a disciplinary against them. The procedure should allow the disciplinary to continue while the grievance is investigated, or to pause if the grievance is genuinely related and material.
Grievance after the employee leaves. Post-employment grievances should still be considered where reasonable, particularly if related to the termination. They can form part of an unfair dismissal claim.
Multiple grievances. Treat each on its merits. Don’t dismiss the second as “the same kind of complainer” — that’s discrimination risk and procedural risk.
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Frequently asked questions
Is having a written grievance procedure a legal requirement?
You must refer to the grievance procedure in the section 1 written statement of employment particulars under the Employment Rights Act 1996. The ACAS Code itself is not law, but tribunals can adjust compensation by up to 25% for unreasonable failure to follow it.
Can the employee bring a solicitor to the grievance hearing?
The statutory right under section 10 of the Employment Relations Act 1999 is to be accompanied by a fellow worker or trade union official — not a solicitor. You can permit a solicitor at your discretion (and many employers do for serious cases), but you don’t have to.
What if the grievance is about discrimination?
Treat it with extra care — discrimination grievances often become tribunal claims under the Equality Act 2010 if mishandled. Investigate thoroughly, take advice if needed, document everything, and consider whether interim measures (separating the parties, providing support) are appropriate. Don’t dismiss the complaint as “they’re being oversensitive” — that itself can support a claim.
How long do I have to keep grievance records?
Keep records for at least six years from the grievance closing — the limitation period for breach of contract claims under the Limitation Act 1980. Some discrimination claims have shorter time limits but records may still be relevant. UK GDPR retention principles apply: keep what you need, no longer.
Can I dismiss someone for raising vexatious grievances?
Carefully. Genuinely vexatious or fabricated grievances may justify disciplinary action — but the bar is high. Repeated grievances about real issues, however inconvenient, are not vexatious. Take advice before treating a grievance pattern as misconduct.
Disclosure: AI Business Kit Docs is our own product. This article is general information, not legal advice. For complex grievances (discrimination, whistleblowing, multiple complainants, allegations against senior staff), get an employment solicitor or HR consultant involved early.