13.2 Unfair dismissal

Generally speaking, an employee must have two years’ continuous service to bring a claim for unfair dismissal, although when they are dismissed for protected reasons such as whistleblowing, trade union membership or pregnancy, that qualifying period is not necessary.

The employer will need to show that the reason, or principal reason, for the dismissal was a potentially fair one. The reason may relate to the employee’s capability (including their health, qualifications or skills), their conduct, a redundancy situation, the illegality of the contract or “some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held”.

The tribunal will need to be satisfied that the employer followed a fair procedure in dismissing the employee.

If the dismissal is found to be unfair, the usual outcome is that the employer will be ordered to pay compensation to the employee. This is broken down into a basic award (equivalent to the statutory redundancy amount and not payable if the employee has already received a redundancy payment) and a compensatory award (subject to a statutory cap, reviewed annually) which reflects the amount of net losses suffered by the employee as a result of the employer’s unfair act. There may also be an uplift or reduction in compensation for a failure to follow a disciplinary and/or grievance procedure.

Compensation may be reduced where the employee has contributed to the outcome through their own bad conduct, or where there is a procedural unfairness but the tribunal is satisfied that the outcome would have been the same in any event.