An employer must show that a dismissal was for one of five permitted reasons:

Conduct

An employer may be able to rely on the employee’s conduct as a fair reason for dismissal. In some instances, the employee’s conduct may be so serious that it is considered fair to terminate the employee’s conduct with immediate effect and without notice pay. This is usually referred to as dismissal on the grounds of ‘gross misconduct’ or ‘summary dismissal’. In other scenarios dismissal may follow after a series of warnings to the employee about their conduct. In both cases it is important for the employer to show that dismissal is reasonable in the circumstances.

Redundancy

A redundancy situation arises where the employer is planning to close down its business/ part of the business, at the location where employees work, or where the business no longer needs as many employees to carry on a particular kind of work.

In order for a redundancy dismissal to be fair, a full and proper procedure must have been carried out. Failure to do so may result in the employee successfully demonstrating that their dismissal was unfair. A fair procedure would often involve identifying the appropriate individuals to place at risk of redundancy and applying fair and objective criteria to identify who should remain in their existing roles. The employer is under an obligation to explore suitable alternative employment for the employee prior to terminating the employment on these grounds.

Where 20 or more employees are to be made redundant within a period of 90 days, this becomes a ‘collective redundancy’, meaning that the employer is required to follow a specific information and consultation procedure prior to dismissing the employees. In a Collective Redundancy, the employer would be required to provide a minimum of 30 days’ consultation, 45 days where there are 100 or more employees to be made redundant.

Capability

If an employee is not sufficiently competent to do the job for which they have been employed, or if they are ill and are absent from work for long periods of time, then their dismissal on the grounds of capability may be reasonable. As well as ensuring that dismissal is reasonable in the circumstances, the employer must ensure that a full and proper procedure is carried out as failure to do so is likely to result in the employee being successful in a claim for unfair dismissal against the employer.

Illegality

If the employment contract is prohibited by law or is performed in an illegal manner, the contract of employment between employee and employer may be void and unenforceable. In general, a court or tribunal will not enforce an illegal contract and the employee should not be afforded employment rights under it. This might be applicable where, by way of example, the employee misrepresents the fact they are entitled to work in the UK.

Some other substantial reason

If it can be shown that there is some other significant reason as to why the employment should be terminated then a dismissal may be fairly justified on the grounds of “some other substantial reason”. Such a reason does not often apply and must be evaluated on a case by case basis.

Even in the event that the employer is able to show that the dismissal was for one of the five fair reasons, they must still satisfy an Employment Tribunal that a full and correct procedure had been carried out, in accordance with the Acas Code of Practice. Failure to do so is likely to result in the employee being awarded an uplift to compensation of between 10% and 25%.

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