Handling a complaint when everyone knows everyone

A grievance procedure assumes structures a small company does not have: someone to hear the complaint who is not involved, someone independent to hear the appeal, and enough organisational distance that the parties need not work together during the process.

In a company of fifteen, the person complained about may report to the person hearing it, the complainant may sit next to them, and the founder may be personally close to both. That does not remove the obligation to handle it properly; it means the mechanics need thinking about in advance.

Have the procedure before you need it

Writing a grievance procedure during a live grievance is the worst available time, because every choice looks tactical. Whatever you decide about anonymity, timescales or who hears an appeal will be read as having been decided to suit the situation.

A short written procedure — how to raise a concern, who it goes to, what happens next, roughly how long, what happens if the complaint is about the person who would normally hear it — is enough. Two pages, written in advance, is worth more than a comprehensive policy written in week two of a dispute.

Take it seriously in writing, immediately

The first response sets the tone. Acknowledge in writing, say what will happen next and roughly when, and confirm what the person has asked for — because a concern raised informally is often understood differently by the two parties.

Resist the instinct to resolve it in the corridor because the company is small and everyone is reasonable. Some concerns genuinely are resolved that way and should be. But the decision to treat something informally should be explicit and agreed with the person raising it, not assumed.

Separate investigation from decision

Even in a small company, try to have different people establish the facts and decide the outcome. Where that is genuinely impossible, say so openly and compensate: be scrupulous about hearing both accounts fully, take notes, and make the reasoning explicit.

External help is a legitimate option that small employers underuse. An independent HR consultant or mediator for a single serious matter costs less than the alternative and removes the structural problem of an interested decision-maker.

Some complaints change the rules

Where a complaint involves discrimination, harassment, safety, or a protected disclosure about wrongdoing, additional legal duties usually apply — including, in many jurisdictions, specific protection against retaliation and sometimes a duty to act regardless of whether the complainant wants a formal process.

These are the matters where advice is worth taking early rather than after the internal process has run. Handling them as ordinary interpersonal disputes is a common and expensive misjudgement.

Manage the aftermath deliberately

In a large organisation the parties can be moved apart. In a small one they will be in the same room on Monday, and the process is not finished when the outcome letter is sent.

Decide what practical changes follow — reporting lines, work allocation, seating, meeting structure — and say what they are. Also decide what is communicated to the wider team, which is usually much less than people want to know and more than nothing; a team that observes a process and is told nothing will construct its own account. For a related product-level perspective on workplace accountability, see the full article. For broader independent guidance on this point, consult Acas grievance guidance.

Record it properly

Keep the complaint, the notes, the evidence considered, the outcome and the reasoning. Written contemporaneously, factually, and on the assumption it may be read by an outside party.

This is also sensitive personal data about at least two people, and it should be stored separately with restricted access and a defined retention period, like any other sensitive record.