Commercial Businesses - Unfair dismissal and constructive unfair dismissal claims

Tags: Unfair Dismissal, TUPE, Redundancy, Misconduct, Service Requirement, Capability, Business re-organisation

Unfair dismissal claims are the most frequent type of claims brought in the Employment Tribunal. 

There are two types of claims, the first being where an employer dismisses the employee and a claim is lodged as a result of the dismissal, and the second being where an employee resigns as a result of the employer committing a serious breach of their express contract or the implied term of trust and confidence (constructive unfair dismissal). 

Is there a qualifying service requirement for bringing an unfair dismissal claim?

To proceed with a claim for unfair dismissal, the claimant must:

  1. Be an employee and not an independent contractor or self-employed and 
  2. Have  been employed by you for the minimum qualifying period of service (though this requirement is subject to exceptions):
    • If employment began before 6 April 2012, they will need to have one years’ service.
    • If employment began after 6 April 2012, they will need to have two years’ service.

How do I avoid unfair dismissal claims? 

To avoid an unfair dismissal claim, firstly you should ensure that you follow the ACAS Code of Conduct when undertaking disciplinary proceedings; this involves ensuring: 

  1. Allegations are investigated;
  2. A meeting takes place where the employee is given the opportunity to put their side across/provide further information and informed of their right to be accompanied;
  3. The outcome of the meeting is sent to the employee in writing and 
  4. The employee is given the opportunity to appeal any decision. 

Failure of the above process will assist employees in succeeding in an unfair dismissal claim with the possibility of a 25% uplift in compensation. 

The second stage is to ensure that you have a fair reason for the dismissal; this must be one of the following: 

  1. Misconduct, e.g. discrimination of another employee; 
  2. Redundancy;
  3. Business re-organisation;  
  4. Employees capability to perform the job; 
  5. Employees breaching their employment contract i.e. breach of confidentiality. 

Any dismissal must be reasonable given the circumstances surrounding the allegations. The tribunal deal with facts on a case by case basis. 

How do I avoid a constructive unfair dismissal claim? 

You should ensure that you follow the ACAS Code of Conduct when undertaking grievance proceedings; this involves ensuring: 

  1. The complaints are investigated by an independent member of management;
  2. A meeting takes place where the employee is given the opportunity to provide further information and informed of their right to be accompanied;
  3. The outcome of the meeting is sent to the employee in writing and 
  4. The employee is given the opportunity to appeal any decision. 

Failure of the above process will enable the employee to ask for a 25% uplift in compensation.  

If you fail to carry out a fair and proper investigation into a grievance the employee may resign and claim constructive unfair dismissal for breach of the implied duty of trust and confidence. 

TUPE 

Further following a transfer of business or service, all transferred employees must retain their terms and conditions of employment. If this is not honoured by the new employer, the employee may resign and claim unfair dismissal. 

If the employer’s failure is found to be connected to the transfer and they do not have an economic, technical or organisational reason for the change, the dismissal could be held to be automatically unfair.

Remedies

Employees who are successful in their claim for unfair dismissal can request reinstatement (returning to their old job) or compensation, though they will have to make every attempt to find alternative employment. 

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