Estimated read time: 4 minutes
Summary
- Unfair dismissal occurs when an employee is dismissed without a fair reason or process.
- Current law requires two years’ service for most claims, with exceptions for automatic unfair dismissal.
- Remedies include reinstatement and compensation, subject to statutory caps.
- Claims must usually be made within three months.
- The Employment Rights Bill will remove the two-year service requirement and introduce statutory probation rules.
What is Unfair Dismissal?
The law recognises five potentially fair reasons for dismissal:
- Capability
- Conduct
- Redundancy
- Where it be against the law if you continued to employ the person
- Another substantial reason
For the dismissal to be fair, an employer must be able to show that it was based on one of the above five reasons.
Even with a fair reason, employers must follow a proper procedure, often guided by the ACAS disciplinary procedure. This means investigating the issues, holding a fair meeting, and allowing an appeal. Certain dismissals are automatically unfair. These include being dismissed for whistleblowing, pregnancy, asserting statutory rights, or trade union activity. In such cases, employees do not need to have worked for their employer for two or more years to bring an Employment Tribunal claim.
It’s important to distinguish unfair dismissal from related claims. Wrongful dismissal concerns breach of and employment contract, such as failing to give notice. Constructive dismissal is where an employee resigns because their employer’s conduct amounts to a serious breach of contract, for example forcing them to work excessive hours or not protecting them from bullying or discrimination.
Many claims succeed because employers make procedural mistakes, such as failing to consult during redundancy or not giving employees a chance to respond. Employers must demonstrate both a fair reason and a fair process to avoid a finding of unfair dismissal.
Who Can Claim Unfair Dismissal?
Eligibility for unfair dismissal claims is set out in the Employment Rights Act 1996, which provides core protection for employees in England and Wales.
Currently, most employees need at least two years of continuous service to bring a claim. This rule applies unless the dismissal is unfair.
What Remedies and Compensation are Available?
Where an Employment Tribunal finds unfair dismissal, it can order one of three remedies:
- Reinstatement: the employee returns to their former job.
- Re-engagement: the employee is given a comparable role.
- Compensation: the most common remedy, made up of a basic award and a compensatory award.
The basic award is calculated using a statutory formula based on age, length of service, and capped weekly pay. The compensatory award reflects actual losses, including earnings, benefits, and pension contributions (subject to statutory limits).
How Do I Make an Unfair Dismissal Claim?
To bring a claim, employees must act quickly. The unfair dismissal time limit is usually three months minus one day from the date of dismissal. Before starting a tribunal claim, the employee must notify ACAS for early conciliation.
The Employment Tribunal process involves submitting a claim form (ET1), setting out the basis of the complaint, and providing supporting evidence. Records of meetings, emails, performance reviews, and witness statements should be used to support your claim.
How Will the Employment Rights Bill Change the Law?
The proposed Employment Rights Bill will bring significant changes to unfair dismissal law in England and Wales. One of the most notable reform is the removal of the two-year qualifying period. Employees will benefit from day-one protection for unfair dismissal, allowing claims without waiting two years.
The Bill also introduces a statutory probation period of nine months, during which employers may dismiss with a lighter-touch process. This is designed to balance early protection with employer flexibility.
Other changes include ending zero-hour contracts and amending the law around fire and rehire.
There has been some commentary that, due to a lack of economic growth and the recent Cabinet reshuffle, certain elements of the Employment Rights Bill may be watered down. The Government has denied this and said it will overturn the amendments made by the House of Lords.
What Practical Advice Helps Employees and Employers?
For employees, if you suspect you’ve been dismissed unfairly, collect evidence such as contracts, correspondence, and meeting notes. Seek early legal advice to explore your options for employee unfair dismissal advice.
Employers should protect themselves against unfair dismissal claims by reviewing dismissal procedures and training managers on compliance. Fair record-keeping, consultation, and transparent processes will reduce the risk of claims.
Final Words
Unfair dismissal law protects employees from losing their jobs without fair reasons or proper processes.
If you believe you have been unfairly dismissed, contact one of our Employment Law Solicitors immediately.
To instruct one of our Employment Law Solicitors, please fill in our contact form or email us at [email protected]