Dismissing an employee – the law

If you dismiss an employee for a reason not allowed by law, without following the correct procedure, or without giving enough notice, is likely to lead to a claim for unfair and/or wrongful dismissal.

The compensation awarded can be in excess of £80,000.00. Even if you have the best defence and succeed at the Employment Tribunal, the process can be time consuming, costly and incredibly stressful!

How can employees be dismissed lawfully?

The dismissal can only be fair if:

  • It is because of the employee's behaviour
  • The work has disappeared or decreased often known as redundancy
  • The employee cannot do the work and is underperforming
  • Employing them would be illegal – for example, if a dentist was suspended from the GDC, this may be a reason to dismiss
  • It is for 'some other substantial reason'. This is understood to be a fair reason that does not fall under the other categories, such as personality clashes, business reorganisation, or a breakdown in trust.

A dismissal for any other reason would be unfair!

You must follow a fair procedure
The procedures you follow when dismissing an employee are just as important. They need to be fair. If they are not fair then this could lead to a successful claim for the employee at the Employment Tribunal!

You must act 'reasonably'.

So your reason for dismissal is fair, now you must be able to show that you acted reasonably. This will involve acting without delay, acting consistently so that all employees are treated the same. You should ensure that all the necessary facts are established through an investigation process. The employee should also be given the opportunity to put his/her case forward before a decision is made.

Notice period
All employees have a right to receive a period of notice (or, depending on their contract, a payment in lieu of notice) if their employment is terminated. The exception to the rule is when the employee has committed an act of which is so serious and hi/her employment is terminated – the employee does not have to receive notice.

If you don’t give adequate notice or payment in lieu before dismissing an employee it is likely to result in wrongful dismissal. The employee may then have a claim for the amount of money together with any benefits they should have earned during the notice period. 

Top 10 tips

  1. Think carefully about any emails or letters sent to employees, the tone and how they are worded
  1. Always keep records of any emails, letters, conversations or meetings (formal or informal) with employees relating to their performance
  1. Have regular appraisals with employees to give an honest assessment of their performance and allow them to raise any concerns
  1. Use probationary periods effectively. To use a probationary period, there must be a written clause to this effect in the employment contract. If the employee is not up to standard deal with it at the outset
  1. Do not try to bully, irritate or marginalise employees. If the employee can show that they resigned for such a reason, they could have a claim that s/he was been treated so badly that s/he has no alternative but to resign and have a claim in the Employment Tribunal for unfair dismissal
  1. If stress could be a reason for an employee's poor performance, it is important you take legal advice
  1. Fully investigate before trying to discipline an employee
  1. Do not assume someone can be dismissed simply because their fixed-term contract has come to an end. You will still need a fair reason and a fair procedure
  1. If an employee has raised a grievance deal with this complaint immediately – don’t delay.
  1. In some situations it is better to reach a financial settlement with the employee, to prevent the employee from bringing a Claim in the Employment Tribunal. If this is the case, you should take legal advice asap.

Sarah Buxton is a specialist dental employment solicitor at Cohen Cramer Solicitors, who specialises in acting for dentists. For 20 years, members of the Cohen Cramer dental team has been advising dental principals, associates and practice managers on all of the legal aspects of buying, selling and running dental practices nationally. With extensive experience in the dental sector the firm is ideally placed to understand and respond to the needs of dental practitioners and practice managers. Ring 0113 2247834 for further information or visit www.CohenCramer.co.uk.


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