Any employee who has over two years’ continuous service with the same employer has the right not to be unfairly dismissed.
In order to dismiss an employee fairly, the employer must overcome two hurdles.
Fair Reason for Dismissal
Firstly, the employer must show that the reason for the dismissal is one of the following ‘potentially fair’ reasons:
- The employee lacks the capability or qualification to carry out the work;
- The employee’s conduct, such as dishonesty or poor attendance;
- A genuine redundancy situation;
- Continued employment would contravene a statute, for example loss of a driving licence if the employee needs to drive as part of their job;
- Some other substantial reason ‘SOSR’; a dismissal which does not fall within any of the above reasons, such as a personality clash or non-renewal of a fixed term contract.
If the employer can show that the dismissal is for one or more of these reasons, the employment tribunal will then consider whether the decision to dismiss was fair looking at what is equitable and the merits of the case. The onus will be on the employer to show that they acted reasonably in treating that reason as a sufficient reason for dismissal.
If a tribunal believes that no reasonable employer would have dismissed the employee in the same circumstances, then the dismissal will be unfair. In making its decision, the tribunal will take into account the size and administrative resources of the employer.
Following the Correct Process
It is very important that employers follow a reasonable process if they are thinking of dismissing an employee. Even if there is a fair reason for dismissal, the dismissal will still be unfair if the employer has not followed a correct process.
In a redundancy situation, the employer must follow a proper consultation and selection process. For dismissals based on misconduct or performance, the process is largely governed by the ACAS Code of Practice. The code provides that there should be sufficient investigations, evidence, warnings and the right to be accompanied at meetings. Although not legally binding, a failure to follow the Code can allow tribunals to increase any damages awarded by up to 25%.
Claim for Compensation
An employee can bring a claim for unfair dismissal in the employment tribunal within three months from the date of dismissal. This process starts by notifying the claim with ACAS under the early conciliation process. If the claim is not settled by way of early conciliation, the employee can submit the claim to the employment tribunal.
If successful, the employee will be awarded compensation, made up of the following:
- Basic award – a statutory award based on length of service, age and pay. The maximum basic award is £16,140.
- Compensatory award – losses which have arisen as a consequence of the unfair dismissal including loss of wages, loss of future wages and loss of statutory rights. The compensatory award is capped at a year’s salary or £88,519, whichever is the lowest.
If you have any queries or concerns please contact Rachel Davis on 01279 712582 or via email firstname.lastname@example.org.