Unfair dismissal can cause big issues for any type of small business. Even business owners with the best intentions and excellent hiring abilities might be faced with dismissing an employee one day.
Here, we look at what classifies as unfair dismissal and explain how to prevent legal action in the face of a dismissal within your business.
No entrepreneur or small business owner wants to dismiss an employee. However, for some, the time might come when it has to be done. In these situations, you must be mindful of the law, but also sensitive to the situation. Being dismissed can be emotional for the employee, other workers and yourself.
If you find yourself needing to dismiss an employee, you must first understand what classifies as fair. If you dismiss an employee unfairly in the eyes of the law, you could face an employment tribunal.
Attending an employment tribunal costs both time and money, and could also have an impact on your business’s reputation, so knowing how to prevent this is critical.
Become familiar with the law when starting your business and take particular note if your business expands abroad, different countries will have different rules of dismissal. For example, Jersey and the Channel Islands have different laws to those of the UK. If you are unsure, consult a lawyer for guidance.
Knowing the law from the outset can help to prevent any cases of unfair dismissal within your business.
What Reasons Qualify for a “Fair” Dismissal?
Dismissal should be the last option. If you have issued previous warnings to the employee and dismissal is the only option left, it needs to be done.
There are certain grounds and ways to dismiss an employee fairly. Fair dismissal means that there is a reasonable issue to dismiss an employee. This includes if the employee has:
- Broken the law
- Conducted themselves inappropriately
- Given false or inaccurate qualifications.
However, these reasons are only fair when the procedure of dismissal is also conducted fairly. This means giving the employee notice of the meeting about the dismissal — at least twenty-four hours before.
At the meeting, you must present evidence of the reasons for dismissal and clearly explain why the termination is happening. Without evidence, the dismissal could be seen as unfair in the eyes of the law.
A fair procedure also means the employee should have a few days (typically up to no longer than a week) to appeal the decision before leaving. If they do not do so before the end of the week, they will leave their position.
Although dismissing an employee is not a pleasant experience, it’s advisable to remain amicable with the employee. This is beneficial for your business and reputation and shows you are sensitive to your employees, even if the working arrangement cannot continue.
What Is Unfair Dismissal?
There are a number of reasons that classify as “unfair” for dismissal. These include, but are not limited to:
- Discrimination of gender, race, sexuality or religion
- Maternity or paternity issues
- Involvement in a Trade Union
- If an employee wishes to change their hours
If any of these are cited as a reason for dismissal, the employee has a right to challenge the decision and take the case to a tribunal. If you find yourself in a case of unfair dismissal and the employee wants to take legal action, you should consult a lawyer immediately.
It’s also important to note the term “constructive dismissal”. This is when a business changes an employee’s contract and, because of this, they are forced to leave their role. A constructive dismissal must still be conducted fairly.
It’s advisable to familiarise yourself with all of the reasons that classify as fair, unfair and constructive dismissal. Be aware of these before starting your business or when setting it up. In an ideal situation, you won’t need to dismiss an employee, but even the most well-run businesses do.
How Can You Avoid an Unfair Dismissal?
Dismissal is unavoidable in certain circumstances. However, you are within full control to ensure it happens fairly. You should consider the following:
Write an employee contract
Expectations of employees can be written into an employment contract. This contract can define the way in which employees should conduct themselves within the working environment.
An employee contract can also include essential information about employee working hours and the process for employee dismissal.
Create an employee handbook
Going beyond just an employment contract, an employee handbook outlines a host of different rules and regulations, as well as discusses company culture and values. This can be used as a point of reference during the dismissal process.
Giving every employee a handbook at the start of their employment contract will help businesses to set out rules and explain more about the business as a whole.
Follow all of the procedures
As long as your reasoning is fair, you are dismissing an employee correctly. However, it’s crucial to make sure that you have sufficient evidence and reasoning, as well as that you give the employee time to appeal your decision. If you don’t do this, it could lead to legal action.
Correct action can ease the situation
If you are ever in doubt about the dismissal process, consult a lawyer. They will be able to guide you through the process and be there if the employee does decide they want to appeal the decision or take the case to a tribunal.
Although it is never a good situation to deal with, handling it in the correct way can make the process significantly easier for all involved.
About the author
This guide has been written exclusively for ByteStart by Lorraine McClure, an expert in Employment Law at Parslows Jersey. Lorraine specialises in employment law and is involved in all aspects of the firm’s work regarding contentious issues and claims in this area.
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