Employment claims are complex, and there is little prospect of recovering the legal costs incurred in defending them. Awards to employees can often be substantial, so it’s therefore worth taking the time to get things right.
You must act fairly and reasonably while ensuring compliance with any relevant terms of the employment contract and likewise ensure that you do not discriminate unlawfully when you dismiss an employee.
What are the fair reasons for dismissal?
- Conduct
- Capability
- Illegality
- Redundancy
- Some other substantial reason (SOSR)
SOSRs are a “catch-all ” category that captures any reasons that don’t fall within the other categories. For instance, they can cover scenarios with a personality clash or irretrievable breakdown in the working relationship.
Automatically unfair reasons for dismissal
- Pregnancy & maternity
- Family reasons
- Representation
- Trade union grounds
- Part-time and fixed-term employees
- Pay and working hours
- Pension scheme trustee
- Whistleblowing
Lawfully dismissing an employee with two or more years of service
The first hurdle is to ensure a fair reason for dismissal (as above). It’s vital you:
- adopt a fair procedure;
- act reasonably in treating the reason as a sufficient reason for dismissal;
- act in accordance with the employment contract;
- do not discriminate, and
- provide reasons for the dismissal in writing.
Guidance on the procedure for dismissal is set out in the ACAS Code of Practice.
Employees with less than two years of service
Generally, employees must have been employed for two years, known as the ‘qualifying period’, before they can bring a claim for unfair dismissal. As such, and with the correct legal advice, it can be relatively straightforward to lawfully dismiss an employee with less than two years’ service – if the reason for dismissal is not automatically unfair and/or discriminatory. Importantly, there is no qualifying period for either of these claims. You must take great care, as successful claims will be deemed unfair regardless of the employee’s length of service.
Discrimination and the protected characteristics under the Equality Act
- Age
- Disability
- Gender reassignment
- Pregnancy and maternity
- Race
- Religion or belief
- Sex
- Sexual orientation
There is no need to demonstrate that an employer acted unreasonably in any of these claims.
Time limits
Strict time limits preclude specific claims from being brought, with extensions being granted to employees when they begin the ACAS early conciliation process.
We can advise you of the relevant time limits depending on the stage of the potential claim. Regardless of its merits, the employee’s claim may be out of time. On occasion, an employee can obtain an extension of time by applying to the Employment Tribunal.
Contractual claims, also known as “wrongful dismissal claims”
Employees who are unable to claim unfair dismissal can still claim breach of contract (regardless of the length of the employment relationship) if you, as the employer, breach a term of the employment contract. For such claims, fairness is not an issue, and the remedy is limited to putting an employee in a position they would have been in if the employer had not breached the employment contract.
In any dismissal, it is crucial that you give notice or notice pay to the employee—unless it is a summary dismissal and all accrued but untaken holiday is accounted for as of the date of dismissal.
When to seek legal advice
You should seek legal advice as early as possible to protect your business from potential claims and stay on the right side of the law.
Some practical steps to avoid potential pitfalls
- Good and consistent record-keeping;
- regular employee appraisals;
- have a compliant grievance procedure in place;
- keep an up-to-date staff handbook which is accessible to staff;
- investigate claims fairly to avoid victimisation claims, and
- depending on what stage of the procedure you are at and the business’s exposure to risk, it may be both practical and commercial to come to a mutual settlement agreement to protect the business from future claims.
Whether you are looking to protect your business from claims, need assistance with a new or existing claim, or require a review of your current policies and procedures, speak to employment lawyer Karen Cole today.
Note: This is not legal advice; it provides information of general interest about current legal issues.