- In addition to termination by the employer, there will be a dismissal where the employee resigns in response to a fundamental breach by the employer (constructive dismissal).
- Dismissing in breach of contract will give rise to a claim for wrongful dismissal. Typically, wrongful dismissal claims concern a dismissal with inadequate notice.
- Employees with more than one month of service are entitled to statutory minimum notice.
- A payment in lieu of notice (PILON) clause allows an employer to dismiss without notice and make a payment in lieu without being in breach of contract.
- Unfair dismissal claims can be brought by employees who have sufficient qualifying service.
- A dismissal will be unfair if is not for a fair reason and/or the employer has acted unreasonably in treating the reason as sufficient.
- The five fair reasons for dismissal are capability, conduct, redundancy, statutory illegality and some other substantial reason.
- No qualifying service is required to bring an unfair dismissal claim where the dismissal is for one of the automatically unfair reasons.
- If an employee is dismissed without following the Acas Code of Conduct: Disciplinary and Grievance Procedures, there is an increased risk of the dismissal being found to be unfair and any compensation awarded can be increased by up to 25 per cent.
- Compensation for unfair dismissal can take the form of a basic award (based on age, pay and years of service) and a compensatory award for losses.
- Tribunals have the power to order reinstatement or re-engagement following a successful claim for unfair dismissal.
The Employment Rights (Increase of Limits) Order 2018 sets out the increased limits for tribunal awards which will take effect from 6 April 2018.
The limit on a week’s pay for calculating the unfair dismissal basic award will increase to £508 meaning the maximum basic award will increase to £15,240, up from £14,670.
The maximum compensatory award for unfair dismissal will also increase to £83,682 or a year’s pay, whichever is lower.
These new limits will apply for any dismissals where the effective date of termination is on, or after, the 6 April 2018. Any dismissals prior to this date will apply the previous compensation limits - see our ‘Statutory rates’ page for more details.