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Constructive and unfair dismissal claims

Employees have the right not to be unfairly dismissed under the Employment Rights Act 1996. If an employee was employed on or after 6 April 2012 they need to have at least two years continuous service to be eligible to lodge a claim. However, this two year rule does not apply in certain cases i.e. pregnancy-related dismissals, discrimination and whistle-blowing. Unfair and constructive dismissal claims have to be brought within three months less a day of the effective date of termination.

Reasons for fair dismissal

There are 5 potentially fair reasons to dismiss an employee:

  • Conduct

 Conduct is a potential fair reason for dismissal either where the employee’s misconduct is so severe to merit summary dismissal (gross misconduct), or where there are numerous acts of misconduct when put together merit dismissal. In cases of minor misconduct, to be a fair dismissal, dismissal will normally follow a series of warnings. Examples of misconduct are usually laid down in an employer’s disciplinary policy.

  • Capability

The employee may not be able to do the job properly. However, the company should not dismiss the employee immediately, but should give a warning first, highlighting that their work is not satisfactory. This may be done via a performance management plan to assist the employee in achieving the required standard. This may involve offering extra training. If an employee is unable to return to work following an illness, this would be classed as a capability issue, i.e. they are no longer capable of carrying out their role. The employer should liaise with the employee to try and assist the employee in returning to work, i.e. making adjustments. The employer may request an employee visit occupational health to look at ways to return.

  • Redundancy

Redundancy is another form of dismissal and, if the reason the person is selected for redundancy is unfair, then the tribunal may decide that they have been unfairly dismissed.

  • Illegality

Where continuing to employ the employee in the position they hold would contravene a statutory restriction - for example, because of their immigration status.

  • Some substantial reason

This is a catch-all category of potentially fair reasons that do not fall under the other categories. For example, this category may include dismissals for failure to agree to changes to terms and conditions, pressure from third parties such as clients, and business reorganisations falling short of a genuine redundancy situation.

Fair in all the circumstances

As well as demonstrating that the reason was fair, the employer must also follow a fair procedure. Employers should implement policies and practices in line with the Advisory, Conciliation and Arbitration Service (ACAS) statutory Code of Practice.

If an employee does regard their dismissal as unfair and they successfully go through an employment tribunal, the ruling can order the employer to reinstate the employee, however this is rare and most cases result in the ex-employee being awarded compensation instead.