If an employee has two years’ or more service they can only be fairly dismissed for one of the following reasons:

  • Conduct
  • Capability (which includes poor performance and incapacity on health grounds)
  • Redundancy (see Redundancy)
  • Some Other Substantial Reason (which could include a complete and irreconcilable breakdown of relationships, or a necessary business reorganisation which does not result in a redundancy)
  • Continuing to employ the employee would entail breach of a statutory enactment (for instance if the employee was no longer eligible to work lawfully in the UK)

In all cases the employer will be required to show that they followed a fair process prior to reaching a decision to dismiss.  What will amount to a fair process will differ depending on the ground for dismissal.


Where conduct is the issue, an employer needs to follow a fair disciplinary procedure.  In general terms this will involve the following stages:

  • An investigation by the employer into the alleged misconduct. The level of investigation will depend on the circumstances of the particular case, including the size of and resources available to the employer.
  • Certain information being given to the employee prior to a disciplinary hearing, including information about the allegations against them, copies of documents on which the employer intends to rely, information on the possible consequences of the disciplinary hearing and confirmation of the employee’s right to be accompanied.
  • A disciplinary hearing should be held, in which the employee is provided with the opportunity to respond to the allegations against them. The outcome of this hearing should be clearly communicated to the employee, in writing.
  • The employee should be given the right to be accompanied at the hearing by a workplace colleague or a trade union representative.
  • The employee must be given the right to appeal any disciplinary sanction, and, if he/she exercises that right, an appeal hearing should be held.

Regard should be had by both employers and employees to the ACAS Code of Practice on Disciplinary and Grievance Procedures. An Employment Tribunal will take into account whether parties have followed the Code or not, and if an Employment Tribunal considers that an employer or employee has unreasonably failed to follow the Code it may make up to a 25% adjustment to any compensation awarded in an unfair dismissal claim.

If an employee is found guilty of misconduct various sanctions may be considered by the employer. If the misconduct is sufficiently serious (generally only gross misconduct) dismissal may be the appropriate sanction. Sanctions short of include a written warning, a final written warning, demotion or deployment. Other remedial actions may also be recommended, such as retraining in a particular area. However, certain actions (such as demotion) should only be taken if the employer has a contractual right to do so.


In cases of poor performance employers will generally be expected to follow a procedure similar to that outlined for a disciplinary case.  In most instances there will be an expectation that the employer should clearly communicate the shortcomings in performance and give the employee the opportunity to improve.  In cases concerning ill health, fairness will be principally about taking into account up to date medical evidence.  Evidently, if an employee has a disability the employer needs to consider its duty to make reasonable adjustments within any procedure that it follows (see Discrimination).

For more information, please click here to contact our Employment team.

Posted on 05/10/2016 in Legal Updates

Back to Knowledge