Mediation is now commonplace in family and commercial disputes. No doubt this is partly because the Courts can insist that the parties try to settle their disputes out of Court but, equally, because mediation works. Mediation in the workplace, however, has taken much longer to become recognised. Why is this?

Between 2004 and 2009, employers and employees had to grapple with the statutory dispute resolution procedures. These were designed to restrict the number of employment disputes that went before Employment Tribunals. Unfortunately, however, the converse was true. The procedures were so complex and the consequences of failing to comply with them were so severe that a whole new set of litigation was spawned to decide what the Regulations actually meant! Thankfully, the statutory procedures were abolished with effect from 6 April 2009.

On 6 April 2009, a new ACAS Code of Practice on Disciplinary and Grievance Procedures came into force. If an employer or employee unreasonably fails to follow the guidance set out in the Code, the Tribunal can increase or reduce, as appropriate, any award it has made by up to 25%.

In the first draft of the Code published by ACAS and sent out for consultation, there was the following sentence: “Employers and employees should do all that they can to resolve disciplinary and grievance issues in the workplace.” Many commentators took the view that this would effectively force parties to mediate workplace disputes and, if they unreasonably failed to do so, to suffer the consequences of a 25% increase/decrease in compensation.

It is one of the central tenets of mediation that the process is voluntary – someone coming to mediation because he/she wants to is much more likely to settle the dispute than someone forced to attend.

ACAS reacted to responses to the consultation and the sentence quoted above was omitted from the final version of the Code of Practice. Instead, it has been relegated to the Foreword to the Code of Practice. The relevant part now reads:

“Employers and employees should always seek to resolve disciplinary and grievance issues in the workplace. Where this is not possible, employers and employees should consider using an independent third party to help resolve the problem. The third party need not come from outside the organisation but could be an internal mediator, so long as they are not involved in the disciplinary or grievance issue. In some cases, an external mediator might be appropriate.”

The Foreword does not form part of the statutory Code of Practice. Accordingly, failure to comply with it does not have any adverse consequences.

In January 2011, the Coalition Government issued consultation on Resolving Workplace Disputes. The first part of the consultation document deals with mediation. It reads:

“Mediation is a process that delivers a solution developed and agreed by both parties, a “win-win” outcome that benefits parties not only in terms of the direct savings from avoiding the tribunal route, but also in terms of preserving the employment relationship, maintaining productivity, reducing sickness absence and increasing employee engagement.”

The consultation closes on 20 April 2011. It is clear that mediation will play an increasingly important role in resolving workplace disputes. The more enlightened employers and lawyers already use mediation in appropriate cases. Lawyers are of course under a duty to act in the best interests of their clients – in my view, the lawyer who fails to suggest and promote workplace mediation in appropriate cases is failing to comply with his/her duty to the client. For anyone who has been involved in workplace mediation, the advantages of mediation over disciplinary/grievance procedures and the litigation that often follows are obvious.

David Parry

Partner and Head of Employment – Darbys Solicitors LLP