Law guide: Workplace

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Unfair dismissal

Unfair dismissal

An unfair dismissal happens when you are dismissed from your job and your employer doesn't have a valid reason for dismissing you and/or has acted unreasonably. It is often confused with wrongful dismissal which is an entirely separate claim. See below for more information.

What is dismissal?

Dismissal in this context of unfair dismissal is when your employer, with or without notice, ends your employment. It can also happen when a fixed-term contract isn't renewed or when an employer forces someone to retire. Dismissal can be done verbally or in writing.

Constructive dismissal

Constructive dismissal is where your employer's actions (e.g. extreme bullying, unilateral demotion) force you to resign.

Summary dismissal

Summary dismissal is where you are instantly dismissed without notice or pay in lieu of notice – this may occur if you have committed an act of gross misconduct. It's impossible to list what amounts to gross misconduct in every case, but your employer's disciplinary procedure should include examples of the types of conduct that would normally warrant summary dismissal.

What is an unfair dismissal claim?

The law recognises that an employer may need to dismiss an employee but tries to ensure that the employer can only do so when it is reasonable and fair. Where an employer dismisses an employee without having a good reason or unfairly, the employee may have an unfair dismissal claim.

Unfair dismissal claims can only be brought in an employment tribunal, and make up a substantial proportion of the cases heard there. Unfair dismissal claims are intended to protect employees from being unfairly dismissed, and give employees the opportunity to claim compensation in addition to any payments in lieu of notice or unclaimed holiday. A necessary element of this kind of claim is that it can only be used by employees. For more information, see our 'Employees, workers and the self-employed' section. Unfair dismissal claims only deal with the actual dismissal itself. Other types of claims, for example discrimination claims, can be entered at the same time but are separate.

Claims must be presented to the employment tribunal within three months of the effective date of termination of employment (see below). These time limits are strictly enforced and therefore if you miss the deadline, the employment tribunal may refuse to hear your case.

The effective date of termination

The effective date of termination is defined as one of the following:

  • The date on which your notice expires (Note that this includes a situation where you have been given notice, but are not required to work your notice period, referred to as 'garden leave'.)
  • If your contract is terminated without notice (including where a payment in lieu of notice is paid) - the date on which the termination takes effect
  • If you have a fixed-term contract that expires without renewal - the date on which the contract expires

Usually there is no difficulty in calculating the effective date of termination and, in most cases, it is the last day on which you worked for your employer.

If you have been dismissed without notice but instead have been paid your wages for the notice period (a payment in lieu of notice), the effective date of termination is still the date you were told to go. In the case of constructive dismissal, the effective date of termination is the date of your departure.

How a claim works

In order to succeed in a claim for unfair dismissal, a tribunal must be satisfied that:

  • You qualify for the right to claim unfair dismissal - in addition to being an employee you must meet other requirements, e.g. you have accumulated a minimum period of continuous service (2 years)
  • You have been dismissed
  • Your employer did not have a fair reason for the dismissal
  • If there was a fair reason, it was not implemented fairly or the penalty was not within a range of responses that would be expected of a reasonable employer

Your employer must show they have investigated the situation adequately and that they have followed the procedural steps set out in the Acas code of practice on disciplinary and grievance procedures. The Acas code is not binding on an employer. However, if they do not follow the procedures set out in the code without having a reasonable excuse for failing to do so, then your dismissal may be unfair. In some cases, the tribunal will increase any award made against an employer by up to 25% for unreasonably failing to follow the Acas code.

In certain circumstances, if your employer has investigated fairly, but come to the wrong conclusion (for example, if they have got the facts wrong), this will not necessarily mean the dismissal is unfair, so long as their decision to dismiss falls within a range of reasonable responses expected from a reasonable employer.

Your employer must be able to show that they have been consistent in the way that they have treated you and that you have not been dismissed for doing something that they normally let other employees do.

You may be able to claim unfair dismissal if you can show that you were dismissed for not following a particular rule or policy of your employer but were never told about the relevant rule or policy.

Wrongful dismissal

Wrongful dismissal is different from unfair dismissal. A wrongful dismissal occurs where an employer dismisses an employee and, by doing so, breaches the terms of the employee's contract.

The most common example is when an employee is dismissed without being paid their notice. It would also include circumstances where a fixed-term employee is dismissed before the end of the term and there is no provision in the contract to do so.

Claims for wrongful dismissal can be brought in either the employment tribunal (within three months of the date of the dismissal) or before the courts (within six years of the date of dismissal). Ideally, proceedings should be issued as soon as possible, in order to avoid unnecessary delays and before recollections fade.

Reasons for dismissal

Automatically unfair reasons

Some reasons for dismissal are automatically unfair. If a dismissal is automatically unfair, statute usually removes the normal need for the employee to have completed a minimum period of employment or to be below a specified age limit to qualify for unfair dismissal.

Statutory employment rights

It is automatically unfair to be dismissed for:

  • Taking or seeking to take maternity, paternity, parental, adoption or dependant care leave
  • Taking or seeking to take time off for jury service (or some other public duty), antenatal care, to accompany a pregnant woman to an antenatal appointment or to look for work or arrange training prior to being made redundant
  • Seeking to take time off for rest periods, breaks and annual leave under the Working Time Regulations
  • Requesting to be paid a minimum wage under minimum wage regulations
  • Making an application for flexible working arrangements
  • Requesting written terms and conditions of employment, itemised pay statements or a written statement of reasons for dismissal
  • Refusing to work on Sundays – this only applies to certain shop/betting workers
  • Failing to disclose a spent conviction
  • Making a protected disclosure (generally known as 'whistleblowing' (Protection of whistleblowers))
  • Claiming repayment following an unlawful deduction from wages
  • Being accompanied by a trade union representative or colleague to a meeting to discuss a grievance, disciplinary/dismissal matter, a request to work beyond intended retirement date or any resulting appeal hearing

In England, Wales and Scotland, an employee can claim unfair dismissal if they were dismissed because of their political opinions or affiliations. They do not need to be continuously employed for the qualifying period in order to make this claim. However, their dismissal will not be treated as being automatically unfair.

Acting as an employee representative

It is automatically unfair to be dismissed for acting as an employee representative at:

  • Grievance/disciplinary and dismissal meetings
  • Appeal hearings
  • Meetings for consultations with your employer about redundancies or business transfers

Health and safety grounds

It is automatically unfair to be dismissed for taking action on health and safety grounds, such as:

  • Carrying out or trying to carry out any activities in your role as a health and safety representative
  • Whistleblowing on health and safety breaches

Part-time and fixed-term working legislation

It is automatically unfair to be dismissed for exercising or seeking to exercise your rights relating to part-time or fixed-term working legislation. As a part-time or fixed-term worker, you should not to be treated less favourably than a full-time or permanent employee (e.g. you should be offered the same or equivalent employment rights and benefits). You cannot be dismissed fairly because you work part time.

Trade unions

It is automatically unfair to be dismissed for reasons relating to a trade union:

  • Membership
  • Recognition
  • Funding

Industrial action

It is automatically unfair to be dismissed for taking part in protected (lawful) industrial action which:

  • Lasts 12 weeks or less
  • Lasts over 12 weeks because your employer has not taken reasonable steps to resolve the dispute

Activities relating to your role as a pension scheme trustee

It is automatically unfair to be dismissed for:

  • Taking or seeking to take reasonable paid time off for your duties
  • For carrying out or trying to carry out your duties

Having been selected for redundancy for any of the reasons listed so far is an automatically unfair reason for dismissal in circumstances where your selection for redundancy would have applied equally to other employees who worked in a similar position.

Business transfers

It is automatically unfair to be dismissed on grounds relating to a business transfer. If the business you work for is being transferred to another company or is being taken over, you may be protected under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).

If you were dismissed for either of these reasons, you will not need to have accumulated the minimum period of continuous service (as mentioned above) before you can take the matter to an employment tribunal.

For more information, see our section: 'When your employer is taken over or transferred'.

Potentially fair reasons

A dismissal is 'potentially fair' if it's because of:

  • Your misconduct
  • Your ability to do your job
  • Redundancy
  • Retirement
  • A legal reason that prevents you from doing your job (for example, losing your driving licence if you're a delivery driver)
  • Another substantial reason

If you have been continuously employed for at least 2 years, or if you are pregnant or are on maternity or adoption leave, you have the right to a written statement of reasons for your dismissal (if you ask).

How much notice must your employer give you?

Your employer must normally give you at least the notice stated in your contract or the minimum period of notice guaranteed by law (if your employment contract does not state the notice to be given or the notice stated in it is less than the minimum allowed under the law) when dismissing you.

However, if the circumstances permit, your employer may dismiss you without notice if you have committed a fundamental breach of contract, such as gross misconduct (being a situation serious enough to dismiss you without first giving a warning (such as theft, fraud or violence).

Your employer should always investigate the circumstances before deciding whether or not to dismiss an employee – even in possible gross misconduct cases.

What to do if you believe you have been unfairly dismissed

Appeal the decision

Your first step should be to appeal the decision to dismiss you under your employer's dismissal or disciplinary appeal procedures, or if you have resigned and intend to claim for Constructive dismissal, by making a complaint under your employer's grievance procedure.

Try using mediation or arbitration

If an appeal fails, you and your employer could try mediation through Acas, where a specialist helps you sort out the problem.

Another option is individual arbitration, where an independent arbitrator hears the case and makes a legally binding decision.

For more information, see our 'Mediation, conciliation and arbitration' section.

Acas runs a scheme called 'Early Conciliation'. This is a free service designed to resolve workplace disputes. If you have a problem with your employer that you can't resolve and are considering lodging a claim at an Employment Tribunal, Acas must first offer the Early Conciliation service.

For more details see the section 'Before making a claim' under Employment Tribunals. You can also see the Acas website for more information.

Mitigate your losses

You have a legal duty to minimise your financial losses (usually loss of earnings) after having been dismissed by your employer. This means you should begin looking for a new job as soon as is reasonably possible after being dismissed. While you are looking for a new job, you may be able to claim Jobseeker's Allowance (Looking for work), Housing Benefit, or Council Tax Benefit.

Preparing to make an employment tribunal claim

It is important for you to ensure that the time limit for starting a claim in the employment tribunal (three months from the effective date of termination of your employment) does not expire whilst you are seeking to use any of the above methods to resolve your dispute. If necessary, you may have to prepare and issue your claim at the employment tribunal whilst in the process of appealing to your employer and/or using mediation in order to protect your rights.

Keep copies of any letters you send and written notes of meetings and telephone conversations, as these may prove useful if any attempts to resolve the issue have failed and you are considering making a complaint to an employment tribunal.

What can an employment tribunal do?

Successful claims

If you are successful, you could get your job back and/or receive compensation. You do not have to take your job back, but your compensation may be lowered if you unreasonably refuse.

In the majority of claims, the employment tribunal awards compensation. Compensation is intended to put you where you would have been financially if you had not been dismissed. There is no compensation for hurt feelings.

A tribunal may reduce your compensation if it decides that your conduct played a part in your dismissal, or if you have failed to present a grievance to your employer where appropriate. Your compensation will also be reduced if you have failed to mitigate your losses.

If you represent yourself in an ET then you can claim from your employer a fixed hourly rate for the time you took to prepare. You can also claim the costs incurred for paying any witnesses' expenses. However, you must apply for such an order before you can claim these costs.

Unsuccessful claims

If you are unsuccessful, then in exceptional circumstances an ET may order you to pay costs if they believe that you have acted abusively, disruptively or otherwise unreasonably.

Therefore you should be certain that you have a valid claim before starting one in an ET, otherwise you will risk having a costs order made against you.

Appealing the decision

If either party is of the view that the decision of the employment tribunal is incorrect on a point of law, they have a right of appeal to the Employment Appeals Tribunal (EAT) and this must be made within 42 days of receiving the full reasons for the employment tribunal's decision.

Enforcing payment of an award

If the employment tribunal makes an order, and either the employer or employee does not comply with it, then the matter will have to be transferred to the county court or (in Scotland) the sheriff court or the Court of Session for the order to be enforced.

What to do if you can't claim for unfair dismissal

You may be able to claim payment for notice, holiday pay or final pay.

Where to get help

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