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5 Tips to Help Businesses Avoid Unfair Dismissal Claims

The dismissal of an employee for a reason other than one allowed by law, without following a fair and reasonable procedure, may lead to a claim for unfair dismissal. Dismissing without giving the required period of notice may lead to a wrongful dismissal claim. If the dismissal is for a discriminatory reason in law there may also be a discrimination claim. Compensation for a successful unfair dismissal claim can be substantial and irrespective of whether a claim succeeds, the management time and legal costs spent in defending it may be significant and are not usually recoverable. Such time and costs can be avoided if you take the time to do things properly and thoroughly.

Lawful Dismissals

In general terms, you must ensure that when considering the dismissal of an employee you:

  • Have a fair reason for dismissal, follow a fair procedure and act fairly and reasonably (so as to avoid an unfair dismissal allegation/claim).
  • Comply with the terms of the employment contract, particularly as regards the employee’s notice period (so as to avoid a wrongful dismissal allegation/claim).
  • Do not discriminate unlawfully.

Employees are also entitled in some cases to written reasons for dismissal.

Dismissals Procedure

Even if you can pinpoint a lawful reason for dismissal, the process for the dismissal must be handled fairly. Disciplinary and dismissal procedures, including the process of appeal, should be made known to staff upon commencement of employment, ideally by way of a disciplinary policy. You may also have other relevant policies that employees should know about, such as a performance management policy and an illness and capability policy. 


Now that we have identified what a lawful dismissal is, and how employers should go about making one, the questions remain:

  • What possible restrictions could employers face when making dismissals?
  • What fair reasons are there for making a dismissal?
  • What practical steps can employers take to reduce the risk of potential claims? 

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