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What are the different grounds for dismissing employees?

When it comes to dismissing staff it’s never the easiest or nicest thing to do, but you must make sure you get it right so as not to be caught up in an unfair dismissal claim and you need to make sure that you act in accordance with the employee’s contract—usually by giving notice or at least paying in lieu.

When you end an employee’s contract you must do it fairly. This gets confusing because you need to observe statutory rules—those relating to unfair dismissal, AND contractual rules, relating to notice.

A dismissal is classed as fair or unfair depending on your reason for it and how you act during the dismissal process.

A fair dismissal happens when you have a potentially fair reason to dismiss, and you do it following good procedures. Fortunately, potentially fair reasons include everything that could realistically cause you to want to dismiss an employee. The most important “fair” reasons are misconduct, redundancy, poor performance and long-term illness. As well as having a fair reason, you must also follow a fair procedure, as set out in the ACAS code of practice relating to dismissal. You can read that online, and if you follow the ACAS guidelines, dismissals should normally be fair.

Constructive dismissal is when an employee resigns because of something you’ve done. This would have to be a breach of their employment contract and could include if you:

  • cut their wages without agreement
  • unlawfully demoted them 
  • allowed them to be harassed or bullied or discriminated against
  • increased their workload unfairly
  • changed the location of their place of work at short notice
  • made them work in dangerous conditions.

A constructive dismissal isn’t necessarily unfair, but it would be hard for you to show that breaching a work contract is fair. A dismissal of this type could lead to a claim for wrongful dismissal (that is to say, dismissal without proper notice) and unfair dismissal.

We've written a blog for employees that you may wish to read - What is Constructive Dismissal?

Wrongful dismissal is when you break the terms of the employee’s contract during the dismissal process. For example, this could be dismissing them without proper notice. It is not the same as unfair dismissal, but confusingly, many cases of unfair dismissal also amount to wrongful dismissal as well.  

Unfair dismissal is the most common type of claim against employers. Employees could claim unfair dismissal if they have more than two years’ service, and they believe that the reason you gave for letting them go wasn’t the real reason. They could also claim that the reason was unfair or untrue or not serious enough to justify the action taken, that you did not allow them a fair chance to answer the allegations, or you acted unreasonably by not giving them sufficient warning about their possible future dismissal.

Even if you believe you’ve acted fairly when firing an employee there are some reasons that are automatically unfair. These include:

  • pregnancy, including all reasons relating to maternity
  • family, including parental leave, paternity leave (birth and adoption), adoption leave or time off for dependants
  • acting as an employee representative
  • acting as a trade union representative
  • acting as an occupational pension scheme trustee
  • joining or not joining a trade union
  • being a part-time or fixed-term employee
  • discrimination, including protection against discrimination on the grounds of age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex and sexual orientation (in Northern Ireland, this also includes political beliefs)
  • pay and working hours, including the Working Time Regulations, annual leave and the National Minimum Wage
  • whistleblowing.

You cannot dismiss someone on the grounds of any of the reasons listed above. If you give a legitimate reason for dismissal, but the employee believes it isn’t the real reason, because of something in the above list, then they would have a legitimate claim for unfair dismissal.

The dismissal process can be complicated and full of legal hazards. It’s always best to get professional advice from a lawyer. Our team of Employment Solicitors for Business are experts in helping employers with this difficult and complex issue. Call us on freephone 0800 916 9060 or contact us online and we will call you.

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