A supervisor at a builders' merchant catches a driver taking timber offcuts home. He rings the owner, they agree on the phone that this is theft, and the driver is called in the next morning and dismissed. He is told he can appeal to the owner, who has already decided.
At the tribunal, nobody disputes that the timber left the yard. The case turns on whether anyone asked the driver about it before deciding, whether the yard had a practice of letting people take offcuts, and whether the appeal was anything other than the same man confirming his own decision. The dismissal is found unfair, and the award is increased because the ACAS code was not followed.
The code is not law, and ignoring it costs money
The ACAS Code of Practice on Disciplinary and Grievance Procedures sets out the minimum a reasonable employer does. It is not itself legally binding in the sense that breaching it is unlawful. What it does is bite on compensation: where an employer unreasonably fails to follow it, a tribunal may increase an award by up to 25%. Where an employee unreasonably fails to follow it, the award may be reduced by up to 25%.
The code is short. It asks for six things: establish the facts of each case, inform the employee of the problem in writing, hold a meeting to discuss it, allow the employee to be accompanied, decide on appropriate action, and provide an opportunity to appeal.
Most small employers get four of those right and fail on the first and the last. Investigating properly takes time you do not feel you have, and an appeal feels like inviting an argument you have already won.
The separate consideration is unfair dismissal. The qualifying period has been two years of continuous service, though the Employment Rights Act 2025 makes protection from unfair dismissal a day-one right, with commencement staged and a statutory probation arrangement. Check the current position before assuming that a short-serving employee cannot claim. Some dismissals never had a qualifying period at all: dismissal for a protected disclosure, for asserting a statutory right, for trade union activity, or for a reason connected with pregnancy, is automatically unfair from day one. Discrimination claims under the Equality Act 2010 have never required any service.
Investigate before you decide, and keep the two apart
The test a tribunal applies to a conduct dismissal comes from British Home Stores v Burchell. Did the employer genuinely believe the employee was guilty of misconduct, did it have reasonable grounds for that belief, and had it carried out as much investigation as was reasonable in the circumstances. The tribunal then asks whether dismissal fell within the band of reasonable responses open to a reasonable employer.
That framing is generous to employers. You do not have to prove the misconduct to a criminal standard. You do have to have looked.
An investigation means gathering the evidence before forming a view: the CCTV, the till records, the delivery notes, statements from the people who saw it, and the employee's own account. Ask the employee what happened before you decide what happened. If the practice at the yard was that offcuts could be taken, that is something an investigation finds and a decision does not.
Wherever you can, separate the roles. One person investigates, a different person hears the disciplinary, and a third hears any appeal. In a firm of eight that is not always possible, and tribunals accept that small employers have fewer people to go round. What they do not accept is that a small employer need not try. If you cannot find three people, use two, and if you cannot find two, consider bringing in an outsider for the appeal.
Suspension is not a neutral act, whatever the handbook says. It should be a last resort where there is a genuine risk to the investigation, to other people or to the business, it should be on full pay, and it should be as short as possible. Suspending as a matter of routine is itself evidence that you had made your mind up.
The hearing has a shape, and the right to be accompanied is statutory
Write to the employee setting out the allegation in enough detail that they can prepare an answer, enclose the evidence you are relying on, give reasonable notice, and state that the outcome could be a warning or, where it genuinely could, dismissal.
Under section 10 of the Employment Relations Act 1999, a worker invited to a disciplinary or grievance hearing has the right to be accompanied by a colleague, a trade union official, or a certified union representative. The companion may address the hearing, put the worker's case and confer with them, but may not answer questions on their behalf. If the companion cannot attend, the worker can propose an alternative time within five working days.
At the hearing, put the allegation, go through the evidence, and then listen. The employee should be able to respond, ask questions and raise anything in mitigation. Adjourn before deciding, even briefly, because deciding in the room tells the employee you had already decided.
Sanctions usually run from a first written warning, to a final written warning, to dismissal. Set how long each stays live, commonly six or twelve months, and then honour that. Dismissal without warnings is only for gross misconduct, which means conduct serious enough to destroy the relationship of trust and confidence: theft, violence, serious breaches of health and safety, gross negligence. Even then, a hearing is still required. Gross misconduct means dismissal without notice, not dismissal without process.
Confirm the outcome in writing, with reasons and with the right of appeal. An employee with two years' service can request a written statement of reasons for dismissal and is entitled to receive one within fourteen days.
The appeal is where cases are saved
An appeal is not a courtesy. It is the mechanism by which an employer can correct a defective process, and tribunals have long accepted that a thorough appeal can cure earlier procedural failings.
Hear it with someone who was not involved in the original decision, wherever that is possible. Consider whether it is a review of the original decision or a complete rehearing, and say which. Take new evidence seriously rather than treating it as a nuisance. Be genuinely prepared to change the outcome, including to a lesser sanction, and if you never have, examine why.
Grievances run on the same logic in the other direction. An employee raises a concern in writing, you meet them promptly, they may be accompanied, you investigate, you respond in writing and you offer an appeal. The common failure is the grievance raised during a disciplinary process, which employers often assume is a delaying tactic. Sometimes it is. Deal with it anyway, either by pausing the disciplinary or by dealing with both concurrently, and record the reasoning.
Before a tribunal claim can be brought, the claimant must notify ACAS and go through early conciliation. That is a real opportunity. It is the last point at which a dispute can be settled for a sum that is smaller than the cost of defending it, whatever the merits, and defending a claim to a hearing consumes days of your time whether you win or lose.
Where this shows up in the game
Business Baron runs employment matters against the law in force in that month, and a disciplinary is a sequence of decisions rather than a single click. Skip the investigation, hold the hearing too fast, or let the same manager hear the appeal, and the claim that follows is stronger. A tribunal in the game does not resolve in one roll. It arrives as an obligation spread across a year, with costs, management time and a story in the local paper. It is all there, including the parts you would rather delegate.