Employment law protects employees who you have employed for two or more years against unfair dismissal under the Employment Rights Act 1996.
After that point, you need to show that it was a fair dismissal or you will face employment tribunal claims. Employees can claim unfair dismissal which comes with it a fine and the tribunal can order you to reinstate them.
Employment law recognises five fair reasons for dismissal. However, remember it is equally important to show that you acted fairly in dismissing, for that reason.
Let's explore the various fair reasons for dismissal, and see what makes up unfair dismissal, so you can stay compliant.
Fair reasons for dismissal
There are five fair reasons for dismissal that employment law views as fair. And you will need to show that the dismissal resulted from one of these reasons.
If you want to avoid employees seeking unfair dismissal claims, ensure that you based the dismissal on the five reasons for dismissal.
So, what are the 5 fair reasons for dismissal? They are:
- Conduct: where their behaviour is unacceptable
- Capability: where they do not have the right skills or aptitude in which to conduct their role
- Statutory ban: where continuing to employ them in their specific role would be in breach of the law
- Redundancy: where the employee’s role is no longer required by the company, so could be a dismissal for economic reasons
- Some other substantial reason: situations where the dismissal does not fall into the above categories, such as reputational damage associated with keeping the employee on.
Whatever the reason for dismissal, clear procedures should be followed leading up to it and, crucially, written reasons for dismissal should be provided.
Grounds for unfair dismissal can also arise because of faults in the procedure which led up to the dismissal as a whole. Meaning even potentially fair reasons for dismissal can be claimed against successfully.
It is therefore important that you maintain and follow clear and lawful procedures before making any decision to dismiss.
One of the most important things for you as an employer to be aware of, when considering reasons for dismissal at work, is the danger of unfair dismissal.
UK unfair dismissal law dictates that employees have the statutory right not to be unfairly dismissed.
In short, this means that the law expects you to act reasonably when deciding whether to terminate the contract of an employee and make sure you are doing so in line with legal reasons for dismissal.
So. If you are wondering can I dismiss an employee for no reason, the answer is no. You absolutely cannot.
Automatically unfair reasons for dismissal
Only an individual who has the relevant qualifying period can bring claims for unfair dismissal. This means that in situations of unfair dismissal under 2 years of service, employees could not pursue the matter in a tribunal.
It is important to remember that we may class a dismissal claim as an automatically unfair dismissal in certain circumstances. This does not require any length of service. This can arise if you dismiss an employee for several specified reasons, including:
- Dismissals related to maternity and paternity
- Dismissals related to union membership
- Dismissals related to health and safety representatives
- Dismissals for refusal to work over 48 hours on average
- Dismissals for insisting on being paid the National Minimum Wage
Reasons for dismissal during the probationary period
Some unfair dismissal examples include dismissing somebody for their behaviour without first implementing a disciplinary procedure, or making an individual redundant, but hiring someone else to undertake a similar role.
Ultimately, what will be determined reasonable by tribunals will depend on the circumstances, the size and resources of the employer and the merits of the case.
During a probationary period, the rules surrounding dismissals regarding conduct and capability may be relaxed somewhat.
For example, a full capability procedure may not be required if the employee has only worked for you for three weeks and you are yet to appreciate if they are the best fit for their role.
It is, therefore, possible to dismiss people during their probationary period if they fail to meet pre-set criteria. However, this must be clearly specified and fair.
The probationary period must not last longer than is reasonable; whilst the government have not set a clear time-frame on this, the average period is usually around six months.
Reasons for instant dismissal UK
Reasons for instant dismissal at work, also known as summary dismissal, occurs when serious conduct offences, such as theft, violence or gross insubordination.
They will leave immediately and will not work any notice period.
Whilst it is fine to go down this route, you should complete a full disciplinary procedure first in order to make sure this decision is fair.
Reasons for constructive dismissal
Constructive dismissal is where an employee resigns from their role because of the conduct of their employer and then claims they were driven to do so.
For example, an employee who feels the tasks they are being asked to do are unreasonable, or that their manager has treated them poorly, may consider going down this route.
Only employees who have worked for you for at least two years are able to bring a claim for constructive dismissal.
Unfair dismissal compensation
You may wonder if, when considering tribunal awards, there is an unfair dismissal cap. The maximum award for unfair dismissal is set by the government, with rates increasing annually, and is made up of a basic and compensatory award.
At the outcome of a tribunal hearing, the tribunal may issue an unfair dismissal reinstatement order. This will require you to re-engage the employee on the same terms and conditions as before with no loss of continuity of employment.
However, as the relationship between yourselves and the employee would likely have broken down by this point, such orders are rare.
Expert support on dismissal with Peninsula
There are a lot of rules to remember regarding the different ways you can terminate an employee’s contract. Getting it wrong can result in unfair dismissal claims and expensive tribunals.
Let our expert HR team help you. We can advise on the steps you need to take. We’ll make sure you know the necessary steps and remove the stress from what is an already difficult situation.
Peninsula clients get access to 24/7 HR advice to lay out the steps you need to take and make sure you have all of the paperwork in order.
And if you’re not yet a client, you can still enjoy a free advice call from one of our business experts. Simply call us on 0800 028 2420.