How to avoid unfair dismissal claims as an employer: HR Advice 

It’s not uncommon for employers to be faced with the decision to terminate someone’s employment. In some cases, it can be completely unavoidable, but any form of dismissal should always meet the Employment Rights Act 1996 unfair dismissal legislation.  

Failing to follow these procedures can quickly turn into an unfair dismissal claim. As a result, your business may be left open to financial and reputational damage.  

In this blog, we’ll talk you through some practical HR advice on how to avoid unfair dismissal claims within your business. 

 

What is employment law unfair dismissal? 

A dismissal is considered ‘unfair’ if the employer doesn’t have a valid reason for sacking an employee. Therefore, the employee may have the right to make an unfair dismissal claim. In order to make a claim, they’ll need to have been employed by the company for at least two years. 

If the employee has worked for the company for less than two years, then their options may be limited. Yet, they can still challenge a dismissal if they believe they have been fired unfairly (such as for discrimination or pregnancy).  

 

What constitutes unfair dismissal? 

If an employee believes they’ve been fired for any of the following reasons, their release would be considered ‘unfair’ under UK employment law: 

• Age 

• Disability 

• Race  

• Religion 

• Requesting flexible work options 

• Requesting time off for jury service 

• Pregnancy and maternity 

• Gender  

• Sexual orientation 

• Taking action on a health and safety concern 

• Whistleblowing i.e. if the protected disclosure is the “reason, or principal reason,” for the dismissal, it is automatically unfair. 

• Joining a trade union 

Surprisingly, redundancy and unfair dismissal don’t necessarily go hand in hand. A redundancy is typically a lawful reason to end employment. 

However, if an employer can’t demonstrate that a redundancy situation genuinely exists (such as a business closure), the dismissal may be deemed as unfair by law. Employers must use impartial selection criteria to decide on who to make redundant.  

 

What counts as fair dismissal? 

5 valid reasons for firing are considered as ‘fair’ dismissal under UK law: 

• Performance: When an employee consistently underperforms despite consistent training. 

• Conduct: When an employee’s behaviour breaches company guidelines. 

• Redundancy: When the employee’s role is genuinely not required. 

• Statutory restriction:  If continuing employment would break the law. 

• Some other substantial reason (SOSR)  

These are just some examples – fair dismissal is not limited to the above. 

 

Can an employee challenge an unfair dismissal? 

Yes. An employee has the right to challenge their employer’s allegations. 

Employees have 3 months, minus one day, from the date their employment ended to claim through their employer’s appeal process. 

Employers should make this process accessible without any obstructions. Even if the employer stands by their decision to dismiss, the employee is lawfully permitted to appeal. Once the appeal has been made, employers should inform the employee who will be reviewing their case and the next steps. 

Employees may also wish to seek further advice from their trade union to gain a better understanding of their rights. 

 

How to avoid unfair dismissal claims  

In all workplaces and industries, unfair dismissal is common, but it can easily be avoided. Our HR professionals have outlined some HR best practices that you should take on board: 

Follow the correct procedures  

Employers should carry out thorough investigations and allow the employee to respond to allegations. In any situation, they should follow the ACAS Code of Practice for disciplinary procedures. They should also follow any polices that have been set out for employees to adhere to, usually detailed in an employee handbook. Failing to do so may weaken your business’s defence if the claim is taken to court. The employee may also be awarded greater compensation if they win the claim.  

Record incidents and follow-ups 

Did you know that accurate documentation could protect you against serious lawsuits? 

In the event of a dispute, these records become a source of evidence that you acted in line with employment law. 

Examples of items you should keep detailed records of include: 

• Disciplinary meetings  

• Performance reviews 

• Absence records 

• Improvement plans 

Provide regular warnings  

Employees should be given a chance to redeem themselves (excluding those who have committed gross misconduct).  

Employers should provide clear verbal and/or written warnings, depending on the organisation’s policy, as a precautionary measure. In doing so, you’ll have additional proof that the opportunity for recuperation has been offered and disregarded. 

Be aware of how health affects performance 

There are often many underlying reasons as to why an employee’s performance may be suffering. Before dismissing an employee, it may be worth checking in on their health. Including mental health. For example, anxiety and depression can have severe knock-on effects on performance and motivation; therefore, this would not be a reasonable ground for dismissal at an initial stage and without seeking professional advice to support both the employer and employee. The support is likely to include referral to an Occupational Health Therapist. 

What’s more, unreasonable pressure or stress from an employer can sometimes lead to constructive dismissal claims (when an employee feels forced to resign due to an unacceptable company action or behaviour). 

Avoid making quick decisions 

Some employers are guilty of making rash decisions about their staff members’ employment status. It’s always worth taking the time to evaluate the situation. Plus, determining whether both parties can come to a mutual agreement. If you’re in any doubt, seek expert advice.  

 

Get in touch with Trusted HR 

Facing an unfair dismissal tribunal can be expensive and time consuming. We understand that it is the very last thing you need when trying to keep up with the demands of running a business. Trusted HR is here to help.  

We’ll explore early resolution to building a strong case, should the matter go to a tribunal.  

Our focus is on addressing issues and offering support at the early resolution stage to prevent disputes from escalating. Should the matter proceed to a tribunal, we will refer you to an experienced solicitor to help present a robust case. 

If your business is currently dealing with a potential unfair dismissal case, please get in touch with us today.