Unfair Dismissal in Employment

Unfair Dismissal.

In an action for unfair dismissal, it is for the employer to prove that there were grounds for dismissal, and that in the circumstances the dismissal is fair.

Five potentially fair reasons for dismissal have been set out at Section 98 of the Employment Rights Act 1986.  These are as follow:-

  1. Lack of appropriate qualifications or capability

This will only be fair if the missing qualification is essential to the proper performance of the job. Interestingly, in Litster v Thom & Sons Ltd (1975) an employee was found to be unfairly dismissed after dismissal for failing to obtain a HGV licence, which had been stipulated as a condition of employment.  It was held that the employee could serve the employer in other ways.

Negligence may justify dismissal. By way of example, in Taylor v Alidair Limited, Mr Taylor was a trained pilot, who was dismissed for causing damage to a plane (and a fright to its passengers) after a bad landing.  The court of appeal held that the degree of professional skill required in that case was so high, and the consequences of from that high standard was so serious that one failure to perform in accordance with those standards was enough to justify the dismissal.

  1. the employees conduct

Whether the conduct justifies dismissal will be a question of fact in each case.  Lying, fighting, theft, or dangerous behaviour would undoubtedly justify a dismissal. Other scenarios such as being rude, or failing to cooperate with management, or drinking on duty, may also be fairly dismissed.

Conduct in an employees spare time may also justify dismissal if it reflects adversely on the employee’s suitability for a job – such as theft. Sleeping with the wife of the employer outside office hours was held to justify dismissal in Whitlow v Alkanet Construction (1987)

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However, if the lack of capability is caused through the fault of the employer, for example, through its failing to provide training or supervision, the dismissal would be unfair.

  1. the employee was redundant

An employer must show that the employee has been fairly selected. The onus would fall to the employer to show that the reason for Gillian’s selection was fair. The EAT laid down guidelines for good industrial practice in redundancies in Williams v Compare Maxam Limited.  This requires consideration as to whether objective selection criteria were chosen and fairly applied; whether the possibility of transfer to other work was investigated; whether employees were warned and consulted and whether any union was consulted.

  1. the continuance of employment would result in illegality
  2. any other substantial reason.

In Gorfin v Distressed Gentlefolks’ Aid Association (1973), a personality clash was sufficient to render dismissal fair in order to restore harmony to the workplace, where all other reasonable steps had been taken to resolve the situation.  Economic reasons may also fall within this heading, if an employer could show that these were based on good commercial practice.  This would include for example removing overtime when defending a claim for constructive dismissal.

Whether the dismissal is fair is subject to the general reasonableness test, as set out at Section 90(4) Employment Rights Act 1996.  This provides that fairness will be judged by deciding whether in all the circumstances the employer acted reasonably “determined according to equity and the merits of the case”.  Merely giving the appropriate contractual notice, and showing that a S98 reason applies will not suffice.  The employer must show that he dealt with the problem in a reasonable way in the particular circumstances. It must be shown that dismissal is a last resort, and that the dismissal has not come out of the blue.  It is important to ensure that adequate warnings are given, failing which an otherwise fair dismissal will be rendered unfair. 

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There are certain circumstances where the law is eager to protect employees who are vulnerable to victimisation, by providing that certain circumstances will automatically give rise to a claim for unfair dismissal – irrespective as to whether an employee has been employed for the one year qualifying period.  These situations include a claim for dismissal in connection with the exercise of maternity rights; dismissal relating to whistle blowing; accompanying workers at a disciplinary hearing; trade union membership or activity; or for taking legal action against an employer to enforce statutory rights.

For a dismissal to be fair, an employer must also show that it followed a fair procedure.  Section 34 of the Employment Act 2002 inserted a new Section 98A into the Employment Rights Act 1996. This sets down the minimum procedural requirements and provides that a breach by the employer of a statutory procedure on dismissal will mean that the dismissal is automatically unfair.  (This reverses the rule in Polkey v Dayton Services Limited.)  The detail of how the procedures would operate in practice was set out in secondary legislation, the Employment Act 2002 (Dispute Resolution) Regulations 2004.

The basic standards are defined in Schedule 2 as:

1) The employer must set outline writing the employees alleged conduct, or characteristics, or other circumstances which lead him to contemplate dismissal or disciplinary action.
2) An invitation must be given to the employee to attend a meeting to discuss the matter, which must take place before action is taken.
3) The employee must have a reasonable opportunity to consider his response.
4) The employer must inform the employee of his decision.
5) The employer must give a right of appeal, together with an invitation to attend a further meeting for this purpose.

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If an employee is found to have breached this procedure, the dismissal is automatically unfair. In addition, there will be an extra award of four weeks pay, if a  tribunal  finds that not to be unjust to the employer.


A Practical Approach to Employment Law – John Bowers, 7th Edition, Oxford University Press 2005
Harvey on Industrial Relations and Employment Law, Butterworths
Law for Business Students, Alix Adams, 3rd Edition, Pearson Longman 2003
Employment Act 2002
Employment Act 2002 (Dispute Resolution) Regulations 2004.
Employment Rights Act 1996 (as amended by the Employment Relations Act 1999)
Trades Union and Labour Relations (Consolidation) Act 1992
Davison v Kent Meters (1975)
Gorfin v Distressed Gentlefolks’ Aid Association (1973),
Litster v Thom & Sons Ltd (1975)
Moore v C & A Modes (1981)
Polkey v Dayton Services Limited [1988] ICR 142
Taylor v Alidair Limited [1978] IRLR 82
Whitlow v Alkanet Construction (1987)
Williams v Compare Maxam Limited [1982] IRLR 83

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