In this post I will outline four principals that must be considered when as an employer you are faced with a claim for unfair dismissal in terms of the Employment Rights Act, 1996 or as an "employee", you are considering bringing a claim for dismissal. This post applies to the law of unfair dismissal in the United Kingdom. I will provide the skeleton in this post and in subsequent posts, we will consider the principals in greater detail.
1.Does the person in question whose contract has been terminated have the right not to be unfairly dismissed?
Not everyone who renders services to another has the right not to be unfairly dismissed. Only employees as defined by the Employment Rights Act, 1996 (The ERA) have this right. Independent contractors and statutory "workers" do not qualify to have this right. There are further qualifications to this right. Only employees who have been continuously employed with the same employer for a year or longer acquire this right. As per my previous post, from the 6th April 2012 this is likely to change to two years. Look at S108 of the ERA to see how this period is calculated and what periods are included or excluded from this calculation . Certain categories of employee are also excluded such as certain Crown employees etc. In most cases, it should be easy to determine if the person is an employee. However there are certain grey areas and complications when it comes to certain independent contractors and atypical working patterns such as agency workers. If you have any uncertainty as regards status, this is a highly complex and technical area and I would obtain legal advice.
One exception to the general principle that a person has to have a specified length of employment in order to qualify, pertains to automatically unfair dismissals. A person obtains a right not to be dismissed for certain reasons from day one. The concept of an automatically unfair dismissal is explored in greater depth below.
If the claimant does not qualify for the right not to be unfairly dismissed in terms ofS 94 of the ERA, the tribunal does not have the jurisdiction to hear a claim for unfair dismissal.
2.If the person does qualify for this right, has there been a dismissal as defined by the ERA?
Not all terminations of a contract of employment constitute a dismissal in terms of the ERA. S 95 of the ERA provides for the following types of dismissal. Firstly where the employer unilaterally terminates the contract of employment. This is the most common type of dismissal. Secondly where the employee is on a fixed term or time contract and the contract expires by way of the event in question and is not renewed e.g a contract that runs from the 1st March 2012 until the 31st March 2012 terminates on the 31st March 2012 and if not renewed, this constitutes a dismissal. Lastly where the employee resigns in circumstances where they would be entitled to resign as a result of the employers conduct. This is the so called constructive dismissal. if the employer commits a serious breach or repudiates the contract, the employee can accept and resign and claim constructive dismissal.
3.Is the reason for dismissal a "potentially fair reason" (PFR) or not?
Firstly you must determine whether the reason for the dismissal is automatically unfair? Certain reasons for dismissing an employee are automatically unfair and if the reason for dismissal falls into these category of reasons, the dismissal will be unfair irrespective of the merits of the matter. The range of these reasons is to wide to deal with in this post. The most common reasons are: 1. For carrying out health and safety functions or bringing potentially or actually harmful circumstances to his employers attention.2 For asserting various statutory rights such as instituting a claim for unlawful deductions. 3 When there is a transfer of an undertaking where the reason for the dismissal is solely or principally related to the transfer or where the reason was related to the transfer and was not an economic, technical or organisational reason. See S 98-104 of the ERA(ERA)
Secondly if the reason for the dismissal is not automatically unfair, is the reason a potentially fair reason for dismissal? S 98 (2) of the ERA provides that you may dismiss someone for a reason related to their ability to do the job (capacity or qualifications), their conduct, failure to meet a statutory requirement, redundancy and for "any other substantive reason". The onus is on the employer to prove the real reason for the dismissal and the determination is made at the time for the dismissal. The employer cannot rely on facts unknown to them at the time of making a decision to dismiss.
4.Was the dismissal fair?
If the reason for the dismissal falls under S 98 (2) of the ERA, the employment tribunal must decide whether upon a consideration of all the relevant circumstances, the employer acted reasonably in dismissing the employee (see S 98(4) ).
This is a vast and complex area but essentially the tribunal must determine two questions:
Firstly whether a fair procedure was followed in taking the decision to dismiss? The general principle seems to be is that the principals of natural justice should be followed before taking a decision to dismiss. This is to say, the employee must be informed of the allegations against them and afforded an opportunity to respond to those allegations. The ACAS Code of Good Practise on Disciplinary and Grievance Procedures , is not binding on employers. However failure to follow the code may result in a 25% increase in compensation awarded if the dismissal is found to be unfair. In addition, the code distills the essential principals of natural justice and as a matter of good practise should be adopted by all employers. The code obviously does not apply in cases of redundancy. In cases of redundancy there must be a full and proper consultation process. The ACAS advisory pamphlet on redundancy sets out the principals nicely.
Secondly, whether the decision to dismiss is within the range of reasonable responses? The tribunal must decide whether the dismissal falls within the range of responses which a reasonable employer may have taken, taking into account all of the relevant circumstances. This element covers too much ground to discuss in this post and will be explored in greater depth in a subsequent posts. However by way of an example, this evaluation normally involves, within the context of misconduct, whether or not the employee is guilty of the misconduct or whether the employer had a reasonable belief that he or she was guilty, the nature of the misconduct, the employees previous disciplinary record and length of service.
I have tried to illustrate the evaluation process diagrammatically below.
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