Disciplinary and Grievance Procedures: A Complete Guide for UK Employers

Friction, disagreements, heated debate. Call it what you like. There will always be differing opinions in workplaces across Manchester, Altrincham and Cheshire. Whether it’s two employees who don’t see eye to eye, a manager who is unhappy with the quality of a team member’s work, or a colleague who feels they are being treated unfairly. Disciplinary and grievance procedures are one of the five workplace challenges where outsourced HR support can prove most valuable. By outsourcing one of the most challenging aspects of people management, you can be sure your business conducts thorough investigations, follows correct procedure, and considers the commercial and legal implications of decisions.

Help for SMEs managing formal people processes 

The key to managing formal people processes well is to understand and follow the relevant processes, communicate clearly and remain impartial at all times. We have created this guide based on our experience of helping SMEs do exactly this.

In this guide:

• An overview of workplace conflict in the UK

• Grievance and disciplinary procedures: legal requirements for SMEs

• The difference between disciplinary and grievance

• Advice on managing employee grievances and complaints

• 6 tips on handling informal conversations

• A step-by-step guide to handling the disciplinary process

• A step-by-step guide to handling the grievance process

• The importance of manager training

Workplace conflict in the UK: the current landscape

According to ACAS research, 44% of people in the UK have experienced conflict at work sometime in the last year. This is much higher than experts anticipated, and highlights the importance of supporting employees to prevent conflict, as well as having processes and procedures for effective management and resolution.

The research, conducted in summer 2025, found that instances of conflict were highest in the retail and wholesale sector, where 50% of people had experienced it. Overall, experience of workplace conflict was highest among 25-34 year-olds.

The two most common reasons for conflict at work are capability and performance, and personal disagreements and relationship issues. Both of these themes have the potential to lead to disciplinary and/or grievance issues if not dealt with early.

Employees are most likely to report conflict with a colleague or manager, but customers, suppliers and members of the public may also be the source of incidents.

AI is creating an extra challenge for people managers. An increase in employees using AI tools to generate formal grievances on their behalf is creating potential pitfalls for colleagues and managers. Colleagues are using language and legal jargon they don't necessarily understand, and managers are unsure how to respond. This can slow down HR processes and exacerbate the original grievance, frustrating all parties.

What does this mean for SMEs?

If we transpose the 44% figure to an SME team of 50 people, this equates to 22 managers and employees who might be affected by workplace conflict in just one calendar year. It’s an astonishing figure that proves conflict has the potential to disrupt and derail any successful team or business.

UK employee disciplinary and grievance procedures: legal requirements for SMEs

Under the Employment Rights Act 1996, all UK employers must have disciplinary and grievance procedures that set out the formal process for reporting incidents and handling investigations. 

A disciplinary procedure must detail:

• what is acceptable and unacceptable behaviour in the workplace

• what action you will take if an employee breaks the rules.

As a general rule, they should cover:

• what is acceptable and unacceptable behaviour

• expectations around absence and timekeeping

• health and safety

• rules around the use of phones and the internet

• the behaviours that constitute gross misconduct and how this will be dealt with, e.g. theft from the workplace, loss of company data.

Disciplinary procedures in UK businesses should be guided by the ACAS Code of Practice. 

Grievance procedures must detail:

• who the employee should contact about a grievance

• how to contact this person.

It should also: 

• explain that if the problem cannot be resolved informally, a grievance hearing will take place

• set out time limits for each stage of the process

• provide details of an alternative contact if the designated person is involved in the grievance

• explain the appeal process

• explain that employees can be accompanied in meetings by a colleague or union representative

• outline what happens if a grievance is raised during disciplinary action.

Business owners may choose whether to include this information in a Contract of Employment or add it to another document, such as an Employee Handbook. Either way, your business must make employees aware that the information exists and how they can access it.

Struggling with where to begin with creating compliant employment policies and contracts? We can supply you with templates, advice and guidance to get you started. See how our HR Admin service supports SMEs like yours.

The difference between a grievance and a disciplinary

What is a grievance?

Grievances occur when employees raise a complaint about a colleague, their work environment. They are usually initiated by the employee. Examples of grievances may include bullying, harassment and being treated unfairly by a line manager.

When investigating a workplace grievance, managers should take a fair a balanced approach, follow relevant procedure, and try to find a solution that works for all parties. 

What is a disciplinary?

A disciplinary process must be followed when a manager has concerns about the conduct, performance or behaviour of a team member. Initiated by the employer, disciplinary proceedings may begin due to poor performance, employee misconduct (ACAS found 14% of workplace conflicts result from employee misconduct), or a breach of company rules and procedures, such as a breach of data protection. 

The aim of the disciplinary process is to correct poor behaviours and improve the employee’s performance and conduct. Failure to do so may result in dismissal. 

Advice on managing complaints and grievances

While formal processes and procedures are there to support people managers, we would always advise an informal approach to resolving employee grievances and conduct issues before resorting to formal measures.

The truth is, the majority of grievances and complaints can be resolved through face-to-face meetings and open conversation before a grievance is raised. Research shows the most common action people took to resolve workplace conflict in 2024/25 was a discussion with their own manager (45%), or an informal discussion with the other person involved in the conflict (30%).

Our advice is to meet with the employee face to face and ask 'what's going on for you?' Don’t wait before you take action. Nobody enjoys awkward conversations, yet they are critical for protecting your business. Observant, intuitive managers should be able to spot when the atmosphere isn’t right in their team.

Why handling grievances early is key

Sadly, some line managers will wait for a written grievance to land on their desk before intervening or investigating. Engaging with the employee at an early stage can lead to an informal resolution and protect your business from several other risks. These include:

• lingering issues impacting team morale 

• a negative culture that drives away talent

• exposure to legal and financial risks when grievances become tribunals

• reputational risk as an employer

• risk of employees leaving the business. 

Failure to deal with disciplinary issues at an early stage can have similar consequences on SME business culture:

• employees are more likely to push boundaries and bend the rules if performance issues are left unchallenged 

• negative impact on team morale and motivation

• drop in productivity

• declining motivation and commitment

• increase in sickness absence rates

• mental health issues, e.g. depression and anxiety.

If left unresolved, disciplinary issues may result in employees requesting moves to different teams or departments, changes to the nature of roles, and even dismissal. All these people moves come with the added, and completely avoidable, expense of recruitment.

How much time should managers spend on resolving people issues?

Manager time and resource is an important consideration when deciding how to manage the disciplinary and grievance process. According to ACAS data, 7% of line managers spent more than one month in a 12-month period managing conflict at work. For SMEs, the impact of this can be huge, with managers pulled away from other essential tasks and responsibilities. Lack of time and resource is a huge factor in clients choosing P3 People Management’s Outsourced HR Services. Your business benefits from expert HR knowledge and best practice advice to help you resolve people challenges.  

6 tips on fair and effective informal conversations

An informal conversation often leads to a grievance to resolving itself. The job of a people manager is to listen actively,communicate your message clearly, fairly, and remain open at all times.

Here are our top tips for managing informal conversations fairly and effectively.

1. Listen carefully: Give the employee the chance to talk freely – and don’t interrupt even if you disagree. You will also learn more through staying quiet and listening actively. Given airtime, people will often share more than they had planned.

2. Ask open questions: Asking questions like “How are things feelilng for you at the moment?” or “What support would be helpful right now?” helps to build trust and allows the person to talk openly and express their feelings. 

3. Make a written record of your conversation: Even for informal conversations - you may need to refer back to this if the grievance becomes formal.

4. Remain calm: If the conversation gets heated, remain calm and try to maintain a friendly atmosphere. Asking open questions about a person’s home life or hobbies can disarm and defuse tension.

5. Treat everyone with respect: This may seem like an obvious one, but so often we can come across as disrespectful if we fail to understand another person’s perspective. Disrespecting a person by criticising them or making them feel foolish will erode trust and create barriers between you. 

6. Express your appreciation: Thank the employee for their openness and honesty in sharing their views. This will build trust between you and pave the way for a strong manager-employee relationship. 

Step-by-step guide to handling the disciplinary process

A manager might need to follow internal disciplinary procedure when they have concerns about misconduct or behaviour of an employee. Examples include persistent lateness, bullying and harassment. Issues related to performance should be dealt with under a separate capability or performance management policy. 

There are five steps you should follow to make sure your process is fair and aligned to ACAS rules.

Step 1: Investigation

Gather all the facts before deciding whether to start formal proceedings. This might involve data from a HR System, interviewing witnesses, colleagues, checking CCTV, reviewing email logs, or collating your notes from past meetings. You should also speak to the employee in question to understand their perspective and any feedback at this stage. During the investigation stage, speak to other managers to ask if they have experienced similar challenges and how they dealt with them. You should also consult HR to check on process and policy, and to confirm if the individual has any history of misconduct or performance issues. If formal action is recommended, the findings and recommendations should be shared with the person who will manage the formal process.

Step 2: Inform the employee in writing

If you decide based on the evidence that there is a case to answer, you must write to the employee to invite them to a formal hearing. In this you must inform them clearly of the alleged misconduct, include copies of any evidence you have gathered, and clearly state their right to be accompanied by a colleague or Trade Union representative. So that the employee can prepare for the meeting, you should give at least 24 hours notice of the meeting and state clearly what the possible outcomes might be.

N.B. In cases of potential gross misconduct (ie theft, harassment) you will need to consider whether suspension is appropriate in the circumstances before proceeding.

Step 3: The disciplinary hearing

This is the employee's opportunity to state their case, respond to the allegations, and present evidence or witnesses. As the employer, your role is to listen, take notes, ask questions, and evaluate what you hear, remaining impartial at all times.

Step 4: Making a decision

There is no pressure to come to a decision at the end of the meeting. In fact, you should take your time to consider what you have heard – and if the decision might be dismissal, then you should adjourn overnight to consider carefully and seek advice. Once you have come to a fair and reasonable decision based on the evidence available, you should inform the employee in person and in writing, explaining what will happen next. 

The action you take should be guided by your internal procedure and company rules and standards. Possible outcomes include an informal warning, written warning, dismissal, or no action at all. 

Step 5: The right to appeal

Whatever the outcome, you must give the employee the right to appeal your decision. If they choose to appeal, the usual process is to appoint an alternative (impartial) manager to conduct the hearing.

Step-by-step guide to handling the grievance process

When an informal approach to handling a grievance is unsuccessful, the next step is to follow the formal grievance process. As their employer, you have a duty to manage this, and there are five key steps to follow.

Step 1: Investigation

The manager dealing with the grievance should refer to any notes taken as part of the informal process and gather input from the person who tried to resolve the grievance informally. 

Step 2: The grievance meeting

The next stage is to set up and invite the employee to a formal meeting to discuss their concerns in detail. As in disciplinary hearings, they have the right to be accompanied by a colleague, companion, or trade union representative. The aim of the meeting is to allow the employee to detail the nature of their complaint and what a satisfactory resolution looks like to them, providing evidence where appropriate. You should take detailed notes and agree with the employee what, if any, further investigation may be required.

Step 3: Investigation

Following the evidence you have heard and read, there may be a need to investigate the issue further, gather evidence and talk to the other people involved before you can come to a fair decision. Always do this with care and consideration of all parties and ensure confidentiality where appropriate. 

Step 4: Outcomes and action

You should inform the employee of your decision both verbally and in writing (email or letter), explaining what actions (if any) the company will take to resolve the issue. A copy of this must be saved to the employee’s file.

Step 5: The right to appeal

If the employee feels the outcome is unsatisfactory or that the grievance process has been biased or unfair, they have the right to appeal the decision. You should provide details of how they can do this in your written decision.

The importance of manager training

It is unrealistic to ask a manager to handle informal or formal people processes without proper training. Managers need to be equipped to respond to grievances and handle the disciplinary process with confidence, sensitivity and impartiality. They need to be able to identify when to engage third party experts, such as a mediation service. And training should not solely focus on following formal process. The ability to maintain fairness, confidentiality and avoid unconscious bias is equally important in avoiding costly tribunals. 

Dealing with such people matters is not easy and can lead to normal emotional responses, so managing their own health and wellbeing as well as the employee/s involved is also important, taking care not to exacerbate existing health issues and consulting with experts, where required. Training should also focus on managing the knock-on effects of formal people processes. Witnessing colleagues going through grievances and disciplinary issues can affect team morale and motivation. Every people manager needs the tools to mitigate the impact on their wider team.

Disciplinary and grievance support for SMEs

Two of the most common HR mistakes small businesses make are failing to follow fair dismissal procedures and ignoring employee complaints and grievances. What might be a simple, honest mistake could easily lead to an expensive tribunal claim. While no business is immune to grievances and disciplinary action, building an open, transparent culture where employees feel able to speak up is the key to minimising their occurrence.