Dismissal

Dismissal can take many forms. This page looks at those various forms and offers guidance and models for dealing with redundancy, retirement and the termination of employment by use of statutory procedures.

The legal definition of dismissal includes:

• The termination of employment by the employer.
• The resignation from employment by the employee where the employee has resigned because the employer has acted in breach of contract, or shown intention to act in breach of contract (this is commonly known as 'constructive dismissal').
• The expiry of a fixed term contract without its renewal.
• The employer's refusal to allow an employee to return to work after a period of absence (eg maternity/paternity/adoption leave) where he/she has a legal right to do so.

Fair dismissal

A dismissal can be fair if the employer can show that the reason for it was one of the below, and provided the employer acted reasonably in the circumstances in treating that reason as sufficient to justify the dismissal:

• a reason related to the employee's capability or qualification for the job
• a reason related to the employee's conduct
• statutory ban (e.g. a driver being banned from driving)
• redundancy
• some other substantial reason (SOSR) which can be justified
• retirement ( however the default retirement age of 65 is to be phased out from April 2011.  This means that it will no longer be fair to retire someone at the age of 65 without objective justification. )

In all cases an employer is obliged to follow procedures included in the contract of employment and these procedures must, as a minimum comply with any statutory requirements.

From 6 April 2009, the statutory dispute resolution procedures were repealed. Organisations will still have to follow a fair, reasonable, prompt and consistent procedure for dismissals.

Capability and Misconduct Dismissals

For dismissals relating to capability or conduct, employers must follow the Acas Code of Practice on discipline and grievance, available from www.acas.org.uk/dgcode2009 .   Employment Tribunals will be able to adjust awards by up to 25% if they feel the Code has not been followed without good reason.

More details on the changes can be found in the leaflet from the Department for Business , Innovation and Skills (BIS) on 'Avoiding and Resolving Discipline and Grievance Issues at Work' which can be downloaded from www.berr.gov.uk/files/file50204.pdf .

More details on disciplinary procedures to be followed when dismissing employees for reasons related to conduct or capability can also be found at www.lvsc.org.uk/disciplinary.

Redundancy Dismissals

Employers should ensure that any redundancy process is fair and are recommended to follow the guidance in the Acas 'Redundancy Handling' booklet available from ww.acas.org.uk/index.aspx?articleid=747 . This includes consultation with affected employees, offering any suitable alternative employment if it exists, providing sufficient notice and paying redundancy payments to employees with continuous service of two or more years.

More guidance on redundancy dismissals can also be found at www.lvsc.org.uk/redundancy.

Compromise agreements

In cases of a dispute, and often before a tribunal claim is considered by an employee, the employer can offer a compromise agreement to settle the matter. There is a very specific form of words that should be used in drafting a compromise agreement and organisations are advised to get legal advice to ensure that the agreement is appropriate and lawful.

For the compromise agreement to be legally valid, it must:

• It must be in writing
• It must relate to a particular complaint (or complaints) which have already been made or intimated and must identify specific statutory provisions
• The employee signing the agreement must have received independent professional advice from a barrister, or a solicitor, or an authorised, qualified legal executive, or a competent and authorised trade union officer, or a certified competent advisor working at an advice centre. It is normal practice that the employer pays for this service, up to a maximum amount of around £500.
• The employee’s advisor must be covered by a contract of insurance or appropriate professional indemnity arrangements
• The advisor must be identified in the agreement and they should certify and sign the agreement.

Acas Pre-Claim Conciliation Services

From April 2009, Acas introduced a new free service to help avoid employment tribunal claim. Before the employee makes a claim, if both the employee and the employer agree, they can access an Acas conciliator to help find a mutually acceptable outcome without the need of a tribunal. If you think you are facing a claim, despite having done all you can to resolve the dispute, call Acas on 08457 47 47 47.

Acas Conciliation Agreement

If the employee goes ahead and makes a complaint to a tribunal, Acas are also asked to conciliate prior to the case reaching the tribunal hearing stage. At this point, if an agreement is made, Acas will put together a conciliation agreement for both sides to sign.

More information about Acas conciliation services.

Retirement

Model retirement procedure (Word file 138kb)

Model retirement procedure - pdf (PDF file 38kb)

Under the Age Discrimination laws, there is a statutory procedure that an employer must follow to ensure that a retirement is fair. This model procedure complies with the statutory requirements.

The national default retirement age as contained in the Employment Equality (Age) Regulations 2006 is 65 years . C ompulsory retirement below 65 is unlawful unless objectively justified.

Please note that the Government has announced that they plan to phase out the Default Retirement Age and abolish the statutory retirement procedure.

Employers can complete any retirements made in relation to the default retirement age, where the employee has been notified before 6 April 2011 and where the retirement will be complete before 1 October 2011. The statutory retirement procedure should be followed.

An employer will need to objectively justify any compulsory retirement made after 1 October 2011.

 

Further advice

Seek further advice and guidance from your local CVS or umbrella group before using the PEACe model contract or other documents. Alternatively phone PEACe on 0203 349 8921, Monday, Tuesday, Wednesday or Thursday or email.

The material in these documents does not give a full statement of the law, nor does it reflect changes after the date stated on each document. It is intended for guidance only and is not a substitute for professional advice. No responsibility for loss occasioned as a result of any person acting or refraining from acting on the basis of this material can be accepted by the author or by LVSC.

Page last reviewed: 17 August 2010