ACAS New Draft Code: A Practical Guide for Employers

ACAS has released its draft replacement Code of Practice on Disciplinary and Grievance Procedures, marking the first full review of the Code since 2009. Although the Code is not legislation, Employment Tribunals must take it into account when deciding relevant claims, and compensation can still be adjusted by up to 25% where either party unreasonably fails to follow it. For employers, particularly SMEs, this makes the proposed changes highly significant.

The consultation is open until 23 September 2026, but the direction of travel is already clear. The draft Code places greater emphasis on the quality of management decisions and early resolution efforts. It moves away from a narrow focus on formal hearings and instead highlights the judgement exercised long before a disciplinary or grievance meeting takes place.

Below is a practical breakdown of what the changes mean and how employers can start preparing.

A Shift Towards Early and Informal Resolution
One of the most notable changes is the elevation of informal resolution. While the current Code mentions informal action mainly in its Foreword, the draft brings it into the statutory text itself. This signals a clear expectation that employers and workers should explore early, informal conversations wherever appropriate.

This won’t suit every situation. Allegations involving safeguarding concerns, gross misconduct or serious risk will still require immediate investigation and formal action. However, many workplace issues fall somewhere in the middle. The draft Code expects employers to be able to explain not only what action they took, but why an informal route was considered unsuitable.

For SMEs, this is a valuable reminder. Early conversations often resolve matters quickly, preserve working relationships and prevent escalation. The challenge is ensuring managers feel confident enough to have those conversations and record them clearly.

Greater Clarity in Written Records and Correspondence
The emphasis on early resolution feeds directly into the formal paperwork. Under the draft Code, an invitation to a disciplinary meeting would need to set out what informal steps were taken or explain why none were appropriate. Similarly, an employee raising a grievance would be expected to include that information in their written complaint.

This may appear procedural, but it creates a clearer record of how an issue developed. It also places more responsibility on managers to document informal discussions with enough detail for HR to understand what happened, what outcome was sought and why the matter later escalated.
For employers, this means reviewing standard templates and ensuring managers understand how to record early conversations in a way that is both proportionate and useful.

A More Thoughtful Approach to Suspension
Suspension receives more detailed treatment in the draft Code. Acas emphasises that suspension should only be used where legally required or where there is a reasonable belief that it is necessary to protect the investigation, the organisation or the people involved.

This reflects the reality that suspension can have serious consequences even though it is not disciplinary action. It can damage trust, affect professional reputation and make a return to work more difficult, particularly if the suspension continues without regular review.

Employers would need to keep suspension as short as possible, explain the basis for the decision and regularly reconsider whether the original justification still applies. A default approach of suspending whenever an allegation appears serious will become increasingly difficult to defend.

Adjustments, Manager Capability and Mediation
The draft Code includes explicit guidance on discrimination and reasonable adjustments during disciplinary and grievance procedures. Employers will need to consider whether disability, communication needs or other protected characteristics affect the format, timing or conduct of the process.

There is also a stronger focus on the competence of managers handling each stage. A well written policy offers limited protection if an investigation is poorly scoped or a decision maker approaches a hearing with a fixed view. The draft Code reinforces the need for training, consistency and fair judgement.

ACAS also proposes a new section on mediation and facilitated conversations. Where both sides agree, the formal process could pause while they explore a consensual resolution. This may help preserve working relationships, but employers will need to ensure that mediation does not become a reason to leave serious concerns unresolved.

A Broader Use of the Term “Worker”
The draft Code generally replaces “employee” with “worker”, reflecting the wider group that may become involved in disciplinary or grievance matters. This does not extend unfair dismissal protection or statutory compensation adjustments to all workers, but it does reinforce the expectation of fair and consistent treatment across the workforce.

What Employers Should Do Now
Although the consultation remains open, employers should begin reviewing their current arrangements. The draft Code highlights areas where many organisations already experience challenges, particularly around consistency, early resolution and suspension decisions.

Key actions include:
• Reviewing how confidently managers handle informal conversations
• Ensuring suspension decisions are justified, documented and regularly reviewed
• Strengthening investigation planning and scope
• Updating templates to reflect the proposed expectations around early resolution
• Providing training to build manager capability and confidence
• Increasing early HR involvement to triage cases and support decision making

The biggest challenge for most organisations is not maintaining a central policy. It is ensuring managers understand the policy and apply it consistently. The draft Code makes that expectation even clearer and places greater pressure on employers to evidence the judgement exercised at each stage.

How Empower People HR Can Support
At Empower People HR, we work closely with SMEs to build practical and compliant people management practices. Whether you need a review of your disciplinary and grievance framework, manager training or support with early resolution, we can help you prepare for the changes ahead.

If you’d like to discuss what the draft Code means for your organisation, please get in touch.