To dismiss an employee fairly, you must first have a fair reason for doing so. Potential reasons for fair dismissal include:
- a statutory requirement which could prevent the employment continuing, such as a driver losing their driving licence
- some other substantial reason - any other potentially fair reasons fall into this category
An example of 'some other substantial reason' would be the dismissal of an employee who was taken on as a temporary replacement for an employee on maternity leave. For such a dismissal to be fair, you must have told the replacement employee at the beginning of their employment that the job was only temporary.
In order for any dismissal to be fair, you must also act reasonably and fairly during the dismissal procedure.
There is no statutory definition of 'reasonableness'. Reasonableness will be judged taking into account the employer’s size and resources and will also consider whether the employer:
- raised and dealt with the issue promptly and consistently throughout the process
- genuinely believed that the reason for dismissal was a potentially fair one
- had reasonable grounds for that belief
- carried out proper and reasonable investigations where appropriate
- followed statutory dismissal and disciplinary procedures
- informed the employee in writing why they were being considered for dismissal and listened to their views
- allowed the employee to be accompanied at disciplinary/dismissal hearings and appeals
- gave the employee the chance to appeal against the decision to dismiss
Reasonableness may also depend on whether the employee could be expected to understand the consequences of their behaviour.
Dismissal and disciplinary procedures
You must set out your dismissal and disciplinary rules and procedures in writing. Sample dismissal procedures (DOC, 14K).
There is a minimum statutory procedure which must be followed when you decide to dismiss an employee. Failure to follow this procedure may result in a finding of automatic unfair dismissal.
If you fail to follow the statutory procedure, where it applies, and the issue is subsequently heard by a tribunal, any compensation awarded to the employee could be increased by between 10 and 50 per cent.
You should follow the good practice advice set out in the Labour Relations Agency (LRA) Code of Practice on Discipline and Grievance.
Additional advice, including sample procedures, can be found in the LRA guidance on advice on handling discipline and grievances at work.
Though tribunals/arbitrators do not have to take this booklet into account, it provides more detail and guidance which may be helpful.
Summary dismissal is the dismissal of an employee without notice or pay in lieu of notice - this occurs when they have committed an act of gross misconduct.
You should investigate the circumstances of the misconduct before dismissing the employee.
However, if you feel that you have no choice but to dismiss an employee, you must still follow statutory procedures.
If you decide to dismiss an employee during their probationary period, you must follow at least the statutory dismissal and disciplinary procedure.
Third-party pressure to dismiss
If a customer or client threatens to withdraw their business unless you dismiss one of your employees, only an industrial tribunal/arbitrator can determine whether or not such a dismissal is fair. Such dismissals are normally categorised as 'some other substantial reason'.
You cannot however take into account pressure exerted by a trade union by the calling or threatening of industrial action.