Dismissing an employee is a necessary but often unpleasant and difficult part of running a business.
Staff with over two years’ service have the right to not be unfairly dismissed, so getting the process right is important—it helps you avoid a compensation bill of over £95,000.
- Have a clear and fair reason
The law sets out five potentially fair reasons for dismissal:
- Statutory ban
- Some other substantial reason (SOSR)
SOSR is commonly seen as a catch-all term, but the reason itself still has to be substantial enough to justify a dismissal.
Many substantial reasons can fall into the SOSR category—one example would be when there’s a breakdown in your working relationship with a staff member.
- Follow a fair procedure
You may want to remove your employee straight away but the law lays down a clear procedure you must follow.
The ACAS Code of Practice on Disciplinary and Grievance Procedures sets out the minimum process, which includes:
- Carrying out an investigation
- Notifying the employee in advance of the allegations
- Holding a disciplinary hearing
- Providing the right to be accompanied
- Giving the right to appeal the decision
A tribunal will consider whether you have followed the Code or not. A failure to apply the Code can lead to a 25% increase in any compensation award.
Remember to follow any further dismissal process requirements included in your company handbook and disciplinary policy.
- Sacking staff with short service
A short service dismissal is for when your employee has less than two years’ service. Short service staff don’t have the right to claim unfair dismissal, so you may be able to speed up the process depending on your company disciplinary procedure.
Still, following a full and thorough disciplinary procedure may help you to avoid the risk of any other claims. For example, your staff can make a discrimination claim as soon as they start working for you as that protection applies from day one of their employment.
- Give the right notice
The only dismissal that does not require notice is one for gross misconduct as this immediately ends the contract of employment.
The notice you have to give an employee when you dismiss them is usually laid out in their contract. But in some circumstances, the statutory notice may override this.
Statutory notice is one week for each year of service up to a maximum of twelve weeks. If this is greater than the contractual notice, then statutory notice must be given.
Giving the employee the correct notice is a must—failure to do so can result in a claim for wrongful dismissal.
- Keep a paper trail
It’s essential you keep written records of all matters you’ve ever discussed with your employee including all letters and minutes of all meetings (signed and dated by everyone present).
This is evidence to prove that you’ve followed a full and proper procedure and a decision-making process in case a dismissed employee takes you to a tribunal.
Learn more about how employment status affects businesses like yours in Working Nation 2017.