HR 4 January 2021

Unfair dismissal a concise guide for employers

Unfair dismissal - employment laws
A concise guide to the laws surrounding unfair dismissal in the UK
Employees have a legal right not to be unfairly dismissed. The law surrounding unfair dismissal is complex, but employers must ensure they act within the law when dismissing any employee. This guide outlines what you need to know.

Read on or click a link to jump ahead:

What is unfair dismissal?

Unfair dismissal is when an employer terminates an employee contract without fair reason to do so. An employee also has the right to claim unfair dismissal if their dismissal is carried out wrongly. To avoid an unfair dismissal claim it is therefore important that employers abide by the rules, whether they are considering a dismissal or carrying one out.

According to guidelines used in employment tribunals, there are fair reasons you can fire an employee:

  1. Capability/Performance may apply if an employee lied about their experience or health resulting in them being unable to fulfil their duties.
  2. Conduct/Misconduct can include theft of company property or information, abusive behaviour, taking time off without prior permission, regularly arriving to work late and more besides.
  3. Redundancy employers must have a clear redundancy policy which must be followed with care. Employers cannot single out individuals for redundancy or appear to make random redundancies.
  4. Breaking the law if an employer breaks the law outside work hours, an employer can dismiss them from employment for gross misconduct or bringing the name of the company into disrepute.
  5. Some other substantial reason (SOSR) this is designed as a catch-all, deliberately wide in scope to provide employers some protection against employees who may actively want to get fired to bring a case for unfair dismissal. SOSR includes such things as being fired due to an important client asking for an employee to be removed or refusal to work with a particular colleague or piece of equipment.
If an employer can prove that the reason for the employee’s dismissal does come under one of the above categories, it is still down to the Employment Tribunal to decide in accordance with equity and substantial merits of the case? as to whether or not the dismissal was fair.

What are the different types of unfair dismissal?

There are two main types of unfair dismissal;

  1. Constructive unfair dismissal
  2. Automatic unfair dismissal

Constructive unfair dismissal

Constructive dismissal is when an employer forces an employee to leave their job. If an employer does something which seriously breaches an employee contract an employee can claim constructive dismissal. To succeed in winning a claim against the employer, an employee must prove that the employer breached the terms of the employment contract, forcing them to resign in response.

Automatic unfair dismissal

Automatic unfair dismissal is when an employee’s dismissal violates an individual’s statutory legal rights.

In many cases, reasons for dismissal considered automatically unfair will be due to an employer violating one or more of an employee’s employment rights. There are around 60 grounds for an employee to claim automatic unfair dismissal, but the most common include:

  • being pregnant or on maternity or paternity leave
  • being a trade union member or representative
  • asking for a legal right, e.g. to be paid the National Minimum Wage
  • doing jury service
  • taking action or proposing action over a health and safety issue
  • refusal to work over 48 hours a week, on average

What is the qualifying period?

To make a claim for unfair dismissal in the UK, individuals must bring the claim within three months of either the date of dismissal or the final day of their notice period.

How can an employee make a claim?

To bring an unfair dismissal claim to the Employment Tribunal, an individual must:

  1. Be an employee, not working through an agency or self-employed
  2. Normally have at least two years continuous employment with the company
  3. Make the claim within three months of the dismissal or the final day of their notice
To make a claim, a person must:

  • Be able to prove the reason of dismissal unless an employer can prove that the reason for the dismissal was fair and reasonable (see above), it is up to the Employment Tribunal to decide whether the dismissal was fair, taking into account the “equity and substantial merits of the case”.
  • Tell Acas they want to make a claim, the other party (the employer) in the dispute will respond to the claim.
  • Acas will offer ‘early conciliation’ allowing the opportunity for both parties to discuss the dispute without having to go to tribunal.
You may be able to skip contacting Acas if:

  • you’re making a claim with another party who has already completed this step
  • Acas has no power to conciliate on some or part of your claim
  • The employer has already contacted Acas and you have evidence that this has happened
  • Your claim allows you to apply for interim relief? and it’s within 7 days of the dismissal interim relief is when a tribunal orders an employer or business to give the job back to the person they have sacked until the hearing happens
  • To continue with a claim and proceed to an employment tribunal you will need an Acas early conciliation certificate number
  • Write a claim statement this should describe the work problem explaining the background details, dates and the names of other people involved. The statement should also describe events accurately and detail any witnesses or evidence.
  • You can make a claim for unfair dismissal online here.

Unfair dismissal compensation how much could an employee get?

Compensation payments for unfair dismissal are often made up of:

Basic award – this is a multiple of a week’s pay which is calculated through a formula which takes into account years of service and the age of the claimant.

The total sum for the basic award is calculated using the following formula:

  • 0.5 week’s pay for each year worked between 18th and 22nd birthday
  • 1 week’s pay for each year worked between 22nd and 41st birthday
  • 1.5 week’s pay for each year worked after 41st birthday
In the case of a long serving employee, only the most recent 20 years? service are taken into account.