Employer guidance – unfair dismissal
At some stage, an employer will likely find itself needing to dismiss a member of staff. It is extremely important that employers are aware of the law to ensure it dismisses fairly and avoids any claims for unfair dismissal.
When will a dismissal be an unfair dismissal?
The 5 potentially fair reasons for dismissal under the Employment Rights Act 1996 include:
- Conduct.
- Capability/performance.
- Illegality.
- Redundancy.
- Some other substantial reason.
It is a good idea to speak to an experienced employment law solicitor about your individual situation to ensure that any dismissal is not, in fact, unfair.
As an employer, you should ensure that you have a
valid fair reason for dismissing an employee, and ensure that you use the
correct process to effect that dismissal, to avoid being accused of unfair
dismissal.
Even if the reason for dismissal may be fair, the dismissal itself can be classed as unfair if you do not act fairly or reasonably during the dismissal process. To fairly handle any dismissal process, it is important to comply with any relevant and required procedures and following the advice set out in the ACAS Code of Practice on conducting disciplinary and grievance processes (where relevant).
Who can make a claim for unfair dismissal?
An employee who has worked for you for two or more years can claim ordinary unfair dismissal.
There are other grounds for an employee to claim automatic unfair dismissal, the most common of which include where a dismissal is because an employee has raised concerns over a health and safety issue, the employee is pregnant or on maternity leave, or the employee is dismissed after raising a whistleblowing disclosure. Some (but not all) claims for automatic unfair dismissal can be pursued without any minimum service requirements.
What are the penalties for unfair dismissal?
If an Employment Tribunal finds that an employer has unfairly dismissed an employee, they might:
- Re-instate the employee in their old role;
- Re-employ the employee in a new role; and/or
- Pay compensation to the employee.
Compensation for unfair dismissal is often made up of:
(1) A basic award – this is calculated through a formula which takes into account the age of the Claimant and their years of service, the same used to calculate statutory redundancy pay;
(2) A compensatory award – this is the lower of either the relevant statutory cap (as amended each year) or 52 weeks of the employee’s salary. This is usually made up of loss of wages to the Tribunal hearing, future loss of wages, loss of benefits and pension rights and expenses in seeking new work.
How to avoid an unfair dismissal claim?
To avoid an unfair dismissal claim you should always ensure that:
- You have up to date and well detailed employment contracts.
- Your policies and Staff Handbook are up to date, that disciplinary procedures adhere to the ACAS Code of Practice (where necessary) and all procedural steps are followed correctly in the event of a dismissal.
- Inform your employees of the disciplinary rules which should be located somewhere accessible by staff at any time (ideally in the Staff Handbook).
- Take any steps to try to resolve the situation informally and ascertain if there is any underlying reason for the employee’s poor performance or misconduct, etc before progressing to a formal dismissal process.
- Seek legal advice from a specialist employment law solicitor.
Should you find yourself looking to dismiss someone, to avoid a potential claim being made against you, speak to our experienced employment law specialists today.
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