Do You Need to Provide a Reason for Dismissal?

By Gary Smith


Employees who have less than two years’ service do not have protection from unfair dismissal. This means that employers can dismiss them for any reason during the first two years of their employment as long as an exception does not apply, usually that it is not related to a disability, discrimination or whistleblowing.

Many employers choose not to give employees a reason for their dismissal during the first two years or will give a reason that they deem to be less ‘hurtful’ to the employee. The recent case of Base Childrenswear Ltd v Otshudi has highlighted the issues with dealing with dismissals in this way.

In this case the employee had only been employed for three months when her employer called her into a meeting and dismissed her with immediate effect giving the reason as redundancy. The employee raised a grievance and an appeal against her dismissal on the basis that she believed her dismissal was related to her race (she is black of African descent). The employer did not respond to either the grievance or the appeal and the employee then issued a claim at the Employment Tribunal for race discrimination.

During the Tribunal proceedings, the employer initially argued that the reason for dismissal was redundancy but later stated that the real reason was that they suspected her of theft as clothes had been found concealed in the area in which she worked. They advised that they had stated it was due to redundancy to avoid a confrontation with her.

The Employment Tribunal ruled that the dismissal constituted racial harassment and the Employment Appeal Tribunal agreed. The Tribunal stated that the employer’s failure to properly investigate the suspected theft, their refusal to respond to the employee’s grievance or appeal and the fact that a false reason was given for the dismissal inferred that race had played a part in the reason for the dismissal. The employer could not show that racial prejudice played no part as they not investigated the suspected theft.

Employers should therefore consider whether they should follow a process before dismissing any employee, particularly where there may be a risk of discrimination or whistleblowing claim being issued against them and, whether following a process or not, providing employees with a letter clearly setting out the reason for their dismissal.

For more information on dismissal and to find out how we can help you, please contact our Employment Team on 0345 646 0406 or fill in our online enquiry form and a member of our Team will be in touch.