Dismissal & Termination

Sometimes an agreement is reached between the employer and employee as to the terms of settlement.  Our solicitors can explain how to ensure that this accords with your employment rights.

Termination of employment by agreement

If you have been employed for more than 4 weeks, you have the right to statutory notice and you may have additional notice in the terms of your contract. You may have the right to protection from unfair dismissal. You have other legal rights, such as the right to protection from unlawful discrimination.

Your employer may suggest terms of settlement to bring your employment to an end.  You may accept this. However, the law is slow to allow you to give up your employment rights notwithstanding such an agreement. Unless the terms of settlement are in the right form, you will not be bound by them.

Settlement Agreement

You must first have legal advice from a properly qualified advisor as to your employment rights. Then you and the advisor must sign a document called a settlement agreement. This document precludes you from bringing claims to the employment tribunal.

Our solicitors can advise your company about all aspects of the dismissal and termination process.

Have you been forced to resign because of the way your employer has treated you or are you considering doing so? If so, it may be possible to bring claims for constructive unfair dismissal and constructive wrongful dismissal.

Constructive dismissal means that your employer has “torn up your contract”.  You will not receive a letter of notice or immediate dismissal, but the effect is the same – and the decision as to what to do next is yours.

To succeed with a claim for constructive dismissal you need to prove to an employment tribunal that:

• there has been a fundamental (very serious) breach of contract
• you have resigned because of this
• you have not done or said anything which shows that you have accepted the breach.

Examples of a fundamental breach of a contract of employment include:

• bullying by management
• certain imposed changes of job
• a pay cut without your agreement
• unjustified disciplinary action
• discrimination on the grounds of disability, sex, race or for other unlawful reasons

There may be one fundamental breach or sometimes there is a series of less serious breaches with the last being the ‘final straw’. 

It is very often advisable to try to sort out your differences with your employer before resigning from your employment and bringing a constructive dismissal claim in an employment tribunal.  This can be done by using your employer’s grievance procedure.  However, if that is unsuccessful, you will need to make a decision as to whether to carry on in your job or to leave. 

Constructive dismissal claims

Constructive dismissal means there is a breach of contract claim. If you were entitled to resign, your former employer is deemed to have failed to give you notice.  This is constructive wrongful dismissal.

If you have sufficient qualifying service with your employer, at least 2 years, you may also be able to bring an unfair dismissal claim. This is constructive unfair dismissal.

Legal advice in connection with constructive dismissal needs to be taken without delay or you could lose a potentially valuable claim.  It can be a difficult decision to make.  Your employer may counterclaim, arguing that you are in breach of contract by resigning without giving notice. 

Our solicitors can advise your company about all aspects of the dismissal and termination process.

When your employment comes to an end you have certain legal rights.  This includes the right to be allowed to work your notice in accordance with your contract of employment or to receive replacement employment rights.

Your entitlement to receive notice

Apart from in cases of very short employment, the law requires that you must receive details of your entitlement to notice in writing from your employer. This includes the notice which you must give to your employer when you decide to leave.  These periods do not have to be the same, although they often are.  Some employees have quite long notice periods and these rights can be very valuable. The law provides for the minimum notice that you are entitled to receive.  This is your statutory notice entitlement.

The notice period has important legal consequences. 

During this period, your employer remains bound by the terms of your contract of employment.  This means that you are entitled to be paid and receive your employment benefits in the normal way.  If your employment is terminated without full notice you will have a claim for loss of pay and benefits during the notice period.   This is known as a claim for wrongful dismissal.

However your employer may have alternatives to allowing you to remain at work. 

• They may be able to pay you in lieu of notice.  This is a payment which takes into account your pay and benefits for your notice period or the remainder of it.
• They may be able to put you on garden leave. This is a requirement that you remain away from work but are paid in your normal way until you notice expires. This is normally used when the employer wants to keep you away from customers or clients.

Sometimes an employer may exercise one of these options without a right to do so in your contract of employment.  This may be breach of contract which may release you from your legal obligations or give you a right to bring a claim.  

Your obligation to give notice

During your notice period, you remain bound by the terms of your contract of employment. This includes your duty of loyalty to your employer.  So you must be careful not to do something that conflicts with this duty by doing something that might help in your new job – or you could find that an injunction is threatened against you.  Failing to give notice will not release you from your legal duties to your employer and you could also find that you are sued for compensation if you leave early.

Our solicitors can advise your company about all aspects of the dismissal and termination process.

Have you been made redundant or are you at risk of redundancy? The established procedures and practices of redundancy law are designed to try to ensure that, even in difficult economic times, decisions to terminate an employment are fair and reasonable. Our solicitors can advise you on your rights and help you enforce them.

You may only be made redundant if:  

• your employer’s business or the place where you work shuts down
• less employees are needed

There are a number of reasons why less staff may be required. It may be because there is less work to do as a result of less business coming in or because there have been changes to the way work is done.  Sometimes, an employee may be described as redundant when that is not the case.

The procedures your employer is required to follow in relation to redundancy include:

• giving sufficient warning of the risk of redundancy
• consulting with those affected
• identifying the jobs at risk
• using a fair procedure to select from the employees in those positions.
• making efforts to try to find alternative positions for redundant staff. 

If you have been dismissed but you are not actually redundant or if fair procedures have not been followed, you may be able to bring an unfair dismissal claim provided that you have been employed with the company for at least 2 years.  An unfair dismissal claim must be brought within 3 months of the last day of employment.

If you are one of 20 or more people made redundant within a given period, your employer must formally consult with a trade union or elected representatives with a view to a reaching agreement on ways of reducing the impact of the redundancies.

Redundancy Compensation

If you are made redundant and have been employed with the company for at least 2 years you will be entitled to a statutory redundancy payment which is calculated in accordance with your age, length of service and a week’s wage which is a capped amount set by the government each year.  Your employer should also let you work your notice. Often an employer may make a payment in lieu of notice or require the you to serve garden leave.  

If your redundancy is unfair, compensation in an employment tribunal is partly calculated in the same way as a redundancy payment but there will be additional compensation for loss of earnings and benefits. Claims for loss of earnings can be brought up to £105,707 or 52 weeks’ pay, whichever is lower. There are a number of factors which the employment tribunal will consider when coming to a decision on the right amount of unfair dismissal compensation.  The employment tribunal can, in some cases, order the employer to take the unfairly dismissed employee back into employment and additional unfair dismissal compensation may be awarded if the order is not complied with.

Where formal consultation is required, if this is not carried out properly, additional compensation may be payable.

Our solicitors can advise your company about all aspects of the dismissal and termination process.

When your employment comes to an end you have certain legal rights.  This includes a minimum notice entitlement.  Our solicitors can explain your employment rights and obligations and the legal consequences if they are not met.

Have you been dismissed? If so, you may have a claim for unfair dismissal compensation.  We explain unfair dismissal law.

You can only be dismissed fairly:

• because of your misconduct
• because of your lack of capability
• because you are redundant
• because of retirement
• because it would be illegal to continue your employment
• or for some other substantial reason

If you have been dismissed for a reason which is on the list, your employer must show that they followed a fair procedure.

• did they investigate the situation properly?
• did they invite you to a meeting to consider the case?
• did they provide you with information in advance of the meeting so that you could prepare for the hearing?
• did you have the right to be accompanied by a trade union representative or official or by a work colleague?
• were you allowed a right of appeal?

If there was a legally permitted reason and appropriate procedures have been followed, fairness will normally depend on whether a reasonable employer might have dismissed you. This may entail considering your length of service and disciplinary record and looking to see how other employees have been treated in similar circumstances.  There may be a number of other considerations to be weighed up.

A claim for unfair dismissal is brought in the employment tribunal. There are strict time limits to bring a claim for unfair dismissal.  Usually you must bring a claim within 3 months of dismissal or you will lose the right to bring the case.

To bring an unfair dismissal claim you usually have to be employed for at least 2 years.  In some cases however you may be able to bring an unfair dismissal claim even if you have less service.  Examples are:

• unlawful discrimination
• health & safety
• trade union membership and activities
• whistleblowing

There are other cases which are automatically unfair and do not require a qualifying period before you can bring a claim.

Unfair dismissal compensation

What might your claim be worth?

Unfair dismissal compensation in an employment tribunal is partly calculated in the same way as a redundancy payment but there is normally additional compensation for loss of earnings and benefits. Claims for loss of earnings can be brought up to £105,707 or 52 weeks’ pay, whichever is lower, although in some cases the compensation is not limited. There are a number of factors which the employment tribunal will consider when coming to a decision on the right amount of unfair dismissal compensation.  The employment tribunal can, in some cases, order the employer to take the unfairly dismissed employee back into employment – and additional unfair dismissal compensation may be awarded if the order is not complied with.

Our solicitors can advise your company about all aspects of the dismissal and termination process.

Wrongful dismissal is the failure by an employer to give proper notice to terminate the contract of employment. A claim for wrongful dismissal is a claim for the loss of pay and benefits during the notice period.

If you have a potential claim for breach of your employment rights, it is most likely that your case should be brought to the employment tribunal.  Although the employment tribunals do not have all the formalities of the civil courts, they have to apply complex legal rules and procedures. Expert legal assistance can be the key to the right outcome for your case.