When you terminate an employee's contract without a fair reason, it's an unfair dismissal.
An employment tribunal will find you guilty of unfair dismissal if you dismissed an employee:
- For a reason that was automatically unfair.
- For a discriminatory reason.
- Without following a fair dismissal procedure.
- For another reason that was unfair.
Of course, all four of these are a bit vague.
So, we’re here to go through these types of unfair dismissal.
And then you’ll know just what you should avoid doing as an employer.
Let’s start with…
Automatically unfair dismissal
A dismissal is automatically unfair if you violate one or more of your employee’s statutory employment rights.
The first thing to note is that, usually, an employee does not need to have worked for you for any length of time, though there are exceptions to this.
When an unfair dismissal isn’t automatically unfair, your recruit needs two years’ service with you (minus one week).
They must also be an employee, rather than a worker or self-employed.
Firing someone for any of the following is an automatically unfair dismissal:
- Membership with a trade union.
- Employee exposed wrongdoing in your workplace (whistleblowing).
- Maternity/paternity leave.
- Adoption leave.
- Shared parental leave.
- They refuse to give up a right under the Working Time Regulations 1998—such as the right to a rest break.
- They tried to enforce their right to receive the national minimum wage.
There are loads of other reasons, too. These are just the most common.
Other reasons that are automatically unfair
Forcing someone to retire when they’re under 65 is an automatically unfair dismissal. Once they’re over 65, an employment tribunal might deem the dismissal fair if you can justify why you made them retire.
If your recruit has a spent criminal conviction that they haven’t declared, you can dismiss them until they reach two years’ service, after that—you guessed it: automatically unfair.
Getting rid of someone because he or she had to do jury service is unfair, too.
If an employment tribunal decides that you dismissed someone for a reason that was automatically unfair, you will owe your former employee compensation.
Maximum compensation in these cases is usually one-year’s pay, up to a limit of £83,682, with a basic award added on.
If you fired somebody for a health & safety reason, or because they blew the whistle, the compensation could be a lot higher.
Compensation for a discriminatory dismissal is unlimited.
Discrimination involves treating someone unfairly because of one or more of their protected characteristics.
- Gender reassignment
- Marriage and civil partnership
- Pregnancy and maternity
- Religion and belief
- Sexual orientation
Everyone you know has his or her own set of these. A person might not have all of them.
But what you can’t do is fire someone because of anything on this list.
Again—this is one of those reasons where your staff don’t need to have worked for you for two years.
Fire someone on his or her first day because of their race, for example, and they have a claim.
Unfair dismissal during probation period
From time to time, a new hire doesn’t work out and you dismiss somebody while they’re on their probation.
An employee must have worked for you for at least two years, as we mentioned earlier, to make an unfair dismissal claim.
But of course, your staff are entitled to all contractual rights from day one.
As we also covered earlier, discriminatory or most automatically unfair dismissals do not need a qualifying period.
You didn’t follow a fair dismissal procedure
It’s your job as the boss to make sure you go through your disciplinary and dismissal procedures. For conduct and for performance.
Letting someone go is the last stop on a long train ride. Before that, you have all these:
- Informal chat with an improvement note.
- Verbal warning.
- First written warning.
- Final written warning.
There are times when you can skip these steps and dismiss someone there and then. This is summary dismissal and occurs when there is an act of gross misconduct or a contractual breach.
Protect your business
You should always make sure that you:
- Give staff copies of all procedures and policies.
- Make notes of all actions when an event could lead to an employment tribunal.
- Keep copies of all messages.
Do these things and you can prove that you made your member of staff aware of all company rules.
Other reasons that are unfair
If your reason for dismissing someone falls outside the five fair reasons for dismissal, then you have a problem.
The five are:
- Poor conduct.
- Lacking capability or the qualifications for the job.
- A statutory duty or restriction that forbids the employment from continuing.
- Some other substantial reason that explains the dismissal.
Suspending someone is not dismissal.
Appeal hearing for unfair dismissal
You should make sure that your appeals procedure for employees to challenge decisions is clear.
You might find that the appeal process leads to you and your staff member finding a way to move forward without an employment tribunal.
If not, your employee has three months minus one day to begin the process of an unfair dismissal claim.
Other types of dismissal
There are other types of dismissal that an employee can make a claim against you for. These include: