Unfair Dismissals
Posted: Monday 3 January 2011
At Morton Fraser we have outlined the key points to remember when in the process of an unfair dismissal.
Potentially Fair Dismissals
There are six situations where a dismissal will potentially be fair. These are where the dismissal is for:-
- capability;
- conduct;
- redundancy;
- contravention of a statutory enactment ;
- some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held; or
- retirement
Once an employer has shown that the reason for dismissal falls within one of the above categories the Tribunal will then look to see whether in all the circumstances and having regard to the size and administrative resources of the employer, the employer acted reasonably.
Automatically Unfair Dismissals
There are certain circumstances where a dismissal will be automatically unfair. In such cases the employee requires to establish only that the reason for the dismissal was one of the automatically unfair reasons. The question of reasonableness does not factor. These include dismissals: -
- related to membership of Trade Union
- due to participation in activities of trade union
- by reason of pregnancy
- for health and safety reasons
- due to a transfer of an undertaking (unless ETO defence applies)
- due to employee attempting to enforce a statutory right
- due to whistle-blowing
This list is not exhaustive. If an employer anticipates that a dismissal may be interpreted by an employee as falling within one of the reasons for automatically unfair dismissal then it is advisable to obtain employment law advice in order to identify the risk of a Tribunal viewing the dismissal in this way.
Constructive Dismissal
Another situation where an employee can claim unfair dismissal is where they resign and claim constructive dismissal. This claim may arise where the employee terminates his contract of employment, with or without notice, in circumstances where he is entitled to terminate by reason of the employer’s conduct. One example of such conduct that may amount to constructive dismissal is where the employer has failed to pay the employee’s salary. However, it is not enough for the employee to show that the employer’s conduct has been unreasonable in some way. The employer must have broken a significant term of the contract and then the employee would have to show that the breaking of the contract was what caused him to leave. Employee’s should exercise caution in resigning from their employment and claiming constructive dismissal given the high test to be satisfied in order to succeed at Tribunal. If an employee is in any doubt as to whether the employer’s conduct amounts to a significantly serious breach of contract to allow them to resign and seek constructive dismissal then it is recommended that they contact an employment lawyer for advice in order to minimise the risk of resigning and then finding that they are both without employment and unable to pursue an Employment Tribunal claim.
Dismissal Procedures
On 6 April 2009 the statutory dismissal, disciplinary and grievance procedures were repealed in England, Scotland and Wales (but not in Northern Ireland). Since then, subject to transitional procedures, for new cases the ACAS Discipline and Grievance Code of Practice has applied. For more information please see The New Disciplinary and Grievance Regime factsheet.
In relation to retirement, the procedures set out in the Employment Equality (Age) Regulations 2006 will apply when an employer is seeking to dismiss any employee on the grounds of retirement.
Claims and Awards
A claim should be made to an Employment Tribunal within 3 months of the date of dismissal (3 months less one day).
In the event that a Tribunal finds the dismissal to be unfair they can make the following orders:-
- reinstatement
- re-engagement
- compensation
Although Employment Tribunals have the power to order reinstatement and re-engagement this power is seldom used. The basic award is calculated in the same way as a redundancy payment and is related to age and length of service. The maximum basic award is £11,400. The maximum unfair dismissal compensatory award is currently £65,300, however in certain limited circumstances, such as in whistleblowing cases, the cap does not apply. Where an employer unreasonably fails to comply with the ACAS Discipline and Grievance Code of Practice the Tribunal may increase any award by up to 25% subject always to the cap of £65,300.
Further information is also available from ACAS (www.acas.org.uk/) and BIS (http://www.bis.gov.uk/)
For more information on unfair dismissal, please contact the Morton Fraser team on 0131 247 1000 / 0141 274 1100 / 020 7397 8621.
