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There are several types of staff dismissal:

• fair dismissal
• unfair dismissal
• constructive dismissal
• wrongful dismissal

Fair and unfair dismissal

A dismissal is fair or unfair depending on your reason or reasons for dismissal and whether you act reasonably during the dismissal process. Industrial tribunals/arbitrators follow previous legal decisions in deciding what is reasonable. What is unfair dismissal and what is fair dismissal?

Constructive dismissal

Constructive dismissal occurs where an employee resigns because you have substantially breached their employment contract, for example:

• cutting wages without agreement
• unlawfully demoting them
• allowing colleagues to subject them to harassment, bullying, victimisation, humiliation or discrimination
• unfairly increasing their workload
• changing the location of their workplace without contractual authority
• making them work in dangerous conditions

The breach of contract can result from either a single serious event or the last in a series of less serious events.

An individual may claim constructive unfair dismissal. A is not necessarily an unfair one but it's hard for an employer to show that an action in breach of the contract was, in fact, fair.

Wrongful dismissal

Wrongful dismissal is where a contractual term is broken in the dismissal process, for example, dismissing an employee without giving them proper notice.

For further information see the Employers' Handbook Section 18: Disciplinary issues and dismissal (PDF, 95K).

To dismiss an employee fairly, you must first have a fair reason for doing so. Potential reasons for fair dismissal include:

• conduct
• capability
• redundancy
• 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.

Acting reasonably

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 that 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%.

You should follow the good practice advice set out in the .

Additional advice, including sample procedures, can be found in the LRA guidance on .

Though tribunals/arbitrators do not have to take this booklet into account, it provides more detail and guidance which may be helpful.

Summary dismissals

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.

Staff probationary periods

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 an employee

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.

Even if you think you have dismissed an employee fairly, they could decide to bring an unfair dismissal claim because they believe that:

• the reason you gave for the dismissal wasn't the real one
• you dismissed them for an unfair reason - see
• you acted unreasonably, eg by failing to give the employee plenty of warning in the run-up to taking the decision to dismiss them

How to fairly dismiss an employee fairly

If you think you may have to dismiss an employee, make sure that you:

• Have a fair reason for dismissal.
• Follow - at the very least - the statutory dismissal procedure. If you unreasonably fail to follow the statutory dismissal procedure and the issue is heard at tribunal, any compensation awarded to the employee could be increased by between 10% and 50%.
• Follow any contractual disciplinary/dismissal procedure you may have, as well as the guidance outlined in the . Your contractual procedure should comply with the code.

See fair dismissal.

Penalties for unfair dismissals

If an employee has been unfairly dismissed, the employer may be ordered to reinstate or reengage the employee. This however is an exceptional outcome.

Invariably, a tribunal or arbitrator will award compensation, made up of a basic award that depends on the employee's age, gross weekly pay, length of service, and a compensatory award.

They can also make an additional award if you fail to follow an order to reinstate or re-engage the employee.

Apart from in health and safety and whistleblowing cases, there is a limit on the amount which can be awarded for unfair dismissal. For the latest limits on awards, see our table of current tribunal and arbitration compensation limits.

The Labour Relations Agency Arbitration Scheme

The provides an alternative to having a case heard by a tribunal to resolve an employment-related dispute (for example, claims of unfair dismissal, breach of contract or discrimination, etc).

The scheme is quicker, confidential, non-legalistic, less formal, and more cost-effective than a tribunal hearing.

Under the scheme, an arbitrator's decision is binding as a matter of law and has the same effect as a tribunal.

Employees can usually only claim unfair dismissal if they have worked for you for at least one year.

There are a number of reasons for dismissal that are automatically unfair. Most of these do not require the employee to have a minimum of one year's service, ie the employee will be able to claim from day one of employment.

Who cannot complain to a tribunal about unfair dismissal?

The right to complain to a tribunal about unfair dismissal is also not available to:

• Self-employed people.
• Those who are not employees, eg, casual workers, independent contractors or freelance agents.
• Members of the armed forces.
• Employees who have reached a settlement with their employer via Labour Relations Agency (LRA) conciliation.
• Individuals working under an illegal contract, eg, a barman who is under the age of 18 years old or employees in receipt of untaxed monies.
• Employees covered by a dismissal procedure agreement that has been exempted from the unfair dismissal provisions by legislation. This is a rarely exercised legal provision.
• Employees taking part in unofficial industrial action (unless the dismissal is for certain specified reasons, eg, taking family leave or making a protected disclosure). For more information, see the page in this guide on dismissals relating to industrial action.
• The police (although police staff may make unfair dismissal claims where the dismissal relates to health and safety or the making of a protected disclosure).
• Those employed as a master - or as a member of the crew - of a fishing vessel where the individual is paid only by a share in the profits or gross earnings of the vessel.
• Employees who have reached a settlement with their employer via a 'compromise agreement'. This is an agreement reached, with the benefit of a relevant independent advisor who has professional indemnity insurance, in which the employee waives their right to make a complaint in relation to the dispute to which the settlement relates. This means that the agreement must specify the legal basis for the dispute - it cannot state that it covers all the possible employment-related claims.

Exemption from the unfair dismissal provisions

The parties to a dismissal-procedures agreement can apply jointly to the Department for the Economy to substitute provisions of the unfair dismissal legislation. Such substitution may be allowed if all the following points are satisfied:

• every trade union which is a party to the agreement is independent
• the agreement has a procedure to be followed if an employee claims to have been unfairly dismissed
• the procedure is non-discriminatory and available to all relevant employees
• the procedure gives employees a similar level of protection to that provided by the legislation
• the agreement includes provision either for arbitration in every case or allows arbitration in cases where a decision can't be reached or where a decision raises a question of law
• the agreement clearly defines which employees it applies to

Lay-offs and short-time working

You may temporarily lay off an employee or put them on short-time working, eg because of a downturn in work. This does not necessarily amount to a redundancy dismissal. You can only do this if the terms of their contract of employment allow it or by agreement with the employee. See Employers' Handbook Section 23: Lay-off and short time working (PDF, 33K).

Sometimes an employee is incapable of doing their job to the required standard. This may be because they don't have the right skills or aptitude for the job.

They may also be capable of doing their job, but unwilling or reluctant to do it properly. In these particular circumstances, you would deal with the issue as one of misconduct and follow your company disciplinary procedures and the statutory dismissal and disciplinary procedures (if they apply). Otherwise capability is a separate dismissal category to misconduct. See dismissals on conduct grounds.

In most cases involving capability, you can help an employee improve by taking informal action, eg by offering training/mentoring or another suitable job (you would only redeploy to another suitable job if this is something that they agree to at this stage).

Capability dismissals: lack of skills/aptitude

To ensure that any resulting capability dismissal is fair when formal action is taken - you should:

1. Inform the employee in writing of the performance issues that exist and invite them to a meeting to discuss these issues.
2. Following the meeting, give an employee who is found to be performing unsatisfactorily a written note, as a summary and explanation ideally, setting out the performance problems identified at the meeting, the improvement that is required, a reasonable timescale for achieving this improvement, a review date and any identified measures of 91Ï㽶»ÆÉ«ÊÓƵ you will provide to assist them to meet the required standards.
3. Inform your employee that the note represents the first stage of a formal procedure and that failure to improve could lead to a final written warning and, ultimately, dismissal. You should keep a copy of the note and use it as the basis for monitoring and reviewing performance over the specified timescale - see manage staff performance. You should also inform the employee that they may appeal at any stage of the formal process.
4. If there is a failure to improve in the timescale outlined, repeat the above procedure and issue a final written warning.
5. If again there is a failure to improve within the timescale set out in the final written warning, this may result in dismissal.
6. Finally, you should note that some exceptional acts of incapability can merit summary dismissal.
7. Throughout the formal process, employees have the right to be accompanied to all meetings and appeal meetings and to appeal to a more senior manager - ideally one not involved in the initial meetings. To read more on the right to be accompanied, .

It is automatically unfair to dismiss workers for taking part in official industrial action:

• In the 12-week period from the day the industrial action starts.
• That lasts longer than 12 weeks - but only if you haven't taken reasonable steps to resolve the dispute. Only an industrial tribunal/arbitrator can decide whether or not you've taken the necessary steps to resolve the dispute.

Subject to some exceptions (see below), an employee dismissed while taking part in unofficial industrial action can't generally claim unfair dismissal.

For the difference between official and unofficial industrial action, see our guide on industrial disputes.

If you 'lock-out' employees taking industrial action, the days of the lock-out are not included in the calculation of the 12-week protected period. A lock-out is where you prevent employees from getting to their workplace, eg, by locking the doors to the premises.

Apart from this, subject to some exceptions (see below), an industrial tribunal/arbitrator can't hear a complaint of unfair dismissal from an employee dismissed while taking part in official industrial action as long as you have:

• dismissed all those who were taking part in the action on the same date that you dismissed the person complaining of unfair dismissal
• not offered re-engagement to any dismissed employee within three months of the dismissal date, without making the person complaining of unfair dismissal a similar offer

Exceptions

The exceptions are that a tribunal/arbitrator can hear a complaint of unfair dismissal from an employee dismissed while taking part in industrial action - either official or unofficial - if the main reason:

• was that the employee took certain specified types of action on health and safety grounds
• related to maternity/paternity/adoption/parental/shared parental/parental bereavement leave, pregnancy, or time off for a dependant
• was that the employee exercised their rights under the Working Time Regulations (Northern Ireland) 2016
• related to the right to request flexible working arrangements
• was that the employee had been summoned or took time off work for jury service
• was that the employee took certain specified types of action as an employee representative or as a candidate to become one, or took part in the election of such a representative

An industrial tribunal/arbitrator can also hear a complaint of unfair dismissal from an employee dismissed while participating in unofficial industrial action if the reason or main reason for the dismissal was that the employee made a protected disclosure.

Dismissal due to capability may also include instances where the employer dismisses because the employee is no longer capable of doing the job they were employed to do, because of illness.

Occasionally, an employee may have to leave your employment because of long-term ill health. Sometimes the employee will simply choose to resign. However, you might eventually have to consider dismissing them.

In order for a dismissal to be potentially fair, you must ensure that you regularly communicate and consult with the employee, take appropriate medical advice, consider the effects of the absence on the business, consider alternatives to dismissal and, if appropriate, take account of any reasonable adjustments as required under disability discrimination legislation. See employ and 91Ï㽶»ÆÉ«ÊÓƵ people with disabilities.

Finally, before dismissing an employee, you must also ensure you comply with the statutory dismissal procedures.

Prior to dismissal due to illness

Before dismissing an employee, you should consider as many ways as possible to help them back to work - dismissal is a last resort and could be unfair if not handled properly. It is also very important that you determine whether or not they are disabled under the Disability Discrimination Act 1995.

You can consider getting a medical report from their GP (with their written permission) or an occupational health assessment. Remember to ask the questions that are relevant to the job, as this will enable you to get the information you need to make an informed decision. The employee has the right to see the GP report before you and may choose not to disclose some information.

If their continued employment is no longer feasible because there are no reasonable adjustments that can be made, it may be fair for you to dismiss them.

During any dismissal procedure, you should treat all employees with sensitivity. You should also act fairly and reasonably. Your dismissal procedure must follow the statutory dismissal requirements.

If you unreasonably fail to follow the statutory dismissal procedures when dismissing and the employee is successful in unfair dismissal proceedings, any compensation awarded by the tribunal or arbitrator could be increased by between 10% and 50%.

If the employee who is subject to the procedure is disabled, you will also have to consider making any possible reasonable adjustments to allow for their needs; you have to address disability discrimination laws, so this is important.

If you find that an employee has been involved in an incident of misconduct, the action you take depends on how serious it is. For example:

• If the misconduct relates to a minor issue, the penalty for a first offence would normally be a verbal warning. This would be followed by a written warning if the offence is repeated within a specified timescale. Further occurrences would result in a final written warning and ultimately dismissal if repeated again.
• If the misconduct relates to a more serious issue, the employer may issue a final written warning for a first offence followed by dismissal for any further repeat of the offence within a specified time scale.
• The Labour Relations Agency (LRA) Code of Practice applies the statutory procedures to the issue of warnings as a matter of good practice.
• If the misconduct is of a very serious nature, the employer may dismiss for a first offence.
• No disciplinary action should be taken until there has been a thorough investigation into the alleged misconduct.
• Details of the alleged misconduct should be set out in writing and given to the employee prior to any hearing taking place.
• The employee must be offered the right to appeal against any decision taken within the formal procedure
• Throughout the formal process, employees have the right to be accompanied to all meetings and appeal meetings and to appeal to a more senior manager - ideally one not involved in the initial meetings
• The recommends that verbal warnings remain on file for a six-month period and written warnings for a 12-month period.

Discipline and dismissal have a statutory procedure which must be followed and if it is not, where it applies, this may result in a finding of automatic unfair dismissal.

Workers who suspect wrongdoing and 'blow the whistle' to disclose these concerns to their employer are protected from dismissal or other negative consequences - as long as certain criteria are met. This law intends to help businesses quickly identify and resolve such problems.

The term 'workers' refers to those who work under:

• a contract of employment, eg, employees
• some other contract to perform work personally, eg, casual workers

It does not cover the genuinely self-employed.

The whistleblowing law also covers NHS practitioners, such as:

• GPs
• certain dentists
• pharmacists
• opticians

It also covers:

• agency workers
• certain categories of trainee
• those who contract to provide services to the Department of Health
• those who contract to provide services to a business via their own limited company - even if introduced via an employment agency or employment business
• student nurses and student midwives who undertake work experience as part of a course of education or training approved by, or under arrangements with, the Nursing and Midwifery Council (NMC)

The types of disclosure that are eligible for protection are known as 'qualifying disclosures'.

These are where the worker reasonably believes that the disclosure is being made in the public interest and at least one 'relevant failure' is currently happening, took place in the past, or is likely to happen in the future.

Relevant failures can be:

• a criminal offence
• a miscarriage of justice
• damage to the environment
• the breach of a legal obligation
• a danger to the health or safety of any individual
• the deliberate covering up of information tending to show any of these matters

The same protection applies even if the qualifying disclosure concerns a relevant failure overseas or where the applicable law is not that of the UK.

Disclosures that can be characterised as being of a personal rather than public interest, will not be protected.

The belief does not need to be correct. The worker only needs to show that they held the belief and that it was a reasonable belief in the circumstances at the time they made the disclosure.

The disclosure is not a qualifying disclosure if:

• by making the disclosure, the worker has committed an offence, eg under the Official Secrets Act 1989
• the information should be protected from disclosure because of legal professional privilege, eg the disclosure has been made by a legal adviser (or their secretary) who has acquired the information in the course of providing legal advice

Qualifying disclosures made internally

A worker is protected if they make a qualifying disclosure to either:

• their employer - either directly or by using a procedure authorised by the employer for that purpose
• to another person who the worker reasonably believes to be solely or mainly responsible for the relevant failure

Ideally, you should have a whistleblowing policy that includes a procedure to follow if a worker wishes to make a qualifying disclosure.

Qualifying disclosures made externally

A worker is protected if they make a qualifying disclosure to an appropriate 'prescribed person'. These are certain statutory bodies - or people within them - who have the authority to receive disclosures relevant to the role of that particular body. Breaches in health and safety law, for example, can be brought to the attention of the Health and Safety Executive for Northern Ireland or the appropriate local council.

.

For the disclosure to be protected, the worker must:

• reasonably believe the information and any allegation it contains are substantially true and are in the public interest to disclose
• reasonably believe they are making the disclosure to the relevant person or body

A qualifying disclosure is also a protected disclosure if it is made:

• to a government minister or a Northern Ireland Department Permanent Secretary by someone working in a government-appointed organisation - this could be directly or via departmental officials and in the public interest to disclose
• to a legal adviser in the course of obtaining legal advice - there are no further conditions attached

Other circumstances where an external disclosure is protected

A qualifying disclosure continues to be a protected disclosure if the conditions below are met.

Firstly, the worker must:

• not act for personal gain
• reasonably believe the information - and any allegation contained in it - is substantially true

In addition, one or more of the following conditions must be met:

• the worker must have previously disclosed the same information to their employer or to a prescribed person
• the worker reasonably believed they would be subjected to a detriment by their employer if the disclosure was made to the employer or a prescribed person
• in the absence of an appropriate prescribed person, the worker reasonably believed that disclosure to the employer would result in the destruction or concealment of information about the wrongdoing

Finally, it must be reasonable for the worker to make the disclosure. An industrial tribunal/arbitrator will decide whether the worker acted reasonably in all the circumstances, particularly taking into account:

• the seriousness of the relevant failure
• whether the relevant failure is continuing or likely to occur again
• whether the worker followed any internal procedures approved by the employer
• what action has, or might reasonably be expected to have, been taken where a previous disclosure was made to the employer or a prescribed person
• whether the disclosure breaches the employer's duty of confidentiality to others
• the identity of the person to whom the disclosure was made

If the relevant failure is exceptionally serious, any qualifying disclosure made externally will be protected if the worker:

• does not act for personal gain
• reasonably believes the information disclosed, and any allegation contained in it, are substantially true

Also, it must be reasonable for the worker to make the disclosure in view of all the circumstances - with particular regard to the identity of the person to whom the disclosure is made.

Only an industrial tribunal/arbitrator can decide whether or not the relevant failure is exceptionally serious. This will be a matter of fact and not simply a matter of the worker reasonably believing it to be exceptionally serious.

Raising a grievance and making protected disclosures

Employees do not necessarily have to raise a grievance in order to make a protected disclosure.

For more information about grievance procedures, see our guide on handling grievances.

There may be good reasons why a worker wishes their identity to remain confidential. The law does not compel an organisation to protect the confidentiality of a whistleblower. However, it is considered best practice to maintain that confidentiality, unless required by law to disclose it.

An employee may bring a claim for unfair dismissal if they are dismissed for making a protected disclosure. A tribunal/arbitrator will find any such dismissal to be automatically unfair.

An employee or other worker who believes they have been subjected to a detriment for making a protected disclosure can bring a complaint of detrimental treatment.

A worker subjected to a detriment by a co-worker in the course of that co-worker's employment with the employer, on the grounds that the worker made a protected disclosure, may be able to take a case to an Industrial Tribunal against both the co-worker and their employer.

A detriment can be either an act or a deliberate decision not to act by the employer. Whether an employee or other worker has suffered a detriment will be decided by the tribunal/arbitrator.

Examples of detrimental treatment include:

• threats of dismissal
• withholding a pay rise
• discrimination in promotion, transfer, or training opportunities
• failure to confer a benefit on a person who failed to accept an unlawful inducement that would have been conferred on them had they accepted the offer

Workers who are not employees cannot claim unfair dismissal. However, their dismissal could amount to a detriment and therefore they could still bring a detrimental treatment claim.

Remedies

Where a tribunal or arbitrator finds that an employee's complaint of unfair dismissal is justified, they will order either:

• reinstatement/re-employment
• the payment of compensation

Where an employee or other worker complains they have been subjected to a detriment and the tribunal or arbitrator finds the complaint well-founded, they will make a declaration to that effect and may order the payment of compensation.

An industrial tribunal will have the discretion to reduce a compensatory award by up to 25% in the event that it finds the disclosure has not been made in good faith.