It is very traumatic for an employee to lose his job, especially when a family or other dependents rely on the income. As the effects of the economic downturn have been felt across the country, issues of redundancies and job losses have been a regular feature in the headlines in the news together with reports of increasing unemployment. Added to this trauma, if the employee feels as if the employer was not acting appropriately in ending his employment, what can be done? Are there any legally remedies for the employee to take the matter up with his employer?
In order for an employee to make a case against his former employer for unfair dismissal, it is important to make sure that certain criteria are fulfilled so that the employee could be entitled to make a claim. Although it may be clear to the employee that he has lost his job, he has to make sure that the termination of his employment qualifies as appropriate ‘dismissal’ according to the legal tests. For example, the employee would not be entitled to claim ‘dismissal’ if he resigns from his position or leaves by agreement with his boss. In brief, an employee is only entitled to claim he has been dismissed if either the employer terminates his contract (with or without notice), the fixed term of employment comes to an end without being renewed or an employee is ‘constructively dismissed’. This last case of ‘constructive dismissal’ means that the employer’s conduct amounts to a serious breach of the employment contract, leading to the employee leaving the job because of it (for example, the boss decides to reduce wages without the employees agreement and the employee subsequently walks out).
Although some cases will fit easily into these categories, it is worth checking with an employment lawyer whether the case qualifies, as sometimes the situation is not always as clear-cut as it may appear. For instance, if circumstances change so that an employee can no longer work for his boss, this may not amount to dismissal. On the other hand, resignation may sometimes be seen to be dismissal if the employee resigns as a result of a constructive dismissal (see above).
Another criterion that must be fulfilled to qualify for unfair dismissal claims is whether the employee is eligible to claim. Some categories of workers, such as independent contractors or freelance agents are not seen as employees for these purposes in the eyes of the law. Also, employees who are obliged to retire at the normal retirement age are unlikely to be seen as unfairly dismissed provided the employer has behaved correctly. As a general rule, the employee must have worked for the employer for a minimum of a year to claim unfair dismissal (however, there are exceptions to this rule).
Next it is necessary to consider the reasons for the dismissal. This is important because sometimes the reason means the dismissal is automatically unfair, such as if the employee is taking action over a health and safety issue, or a new owner takes over the business, or the employee is pregnant. Importantly, in some of these cases the employee does not have to have worked for the employer for a year to qualify for automatic unfair dismissal. If the reason for the dismissal is not ‘automatically’ seen as unfair, however, it is necessary to assess the reasons for the dismissal and the procedure which the employer has followed in order to work out whether the employee could make a successful claim for unfair dismissal. It is usually necessary for the employee to bring a claim within a three month period from the date of dismissal to take the matter to an employment tribunal. If an employee believes there has been some form of discrimination, such as on grounds of age, disability, gender or race, a claim for discrimination can be brought at the same time as a claim for unfair dismissal.
What is the procedure that the employer should follow when dismissing employees? The answer depends on when the employee was dismissed and so it is recommended that legal advice is sought for further details of the various obligations on the employer. For example, after 6 April 2009, an employer taking disciplinary action or dismissing employees is advised to follow the Acas Code of Practice on disciplinary and grievance procedures to avoid paying more compensation in a successful claim.
Before making a claim for unfair dismissal, it would be advisable for the employee to consider the likely level of compensation available. Compensation usually comprises a basic award and a compensatory award. A basic award is calculated by looking at the time of service of the employee and the level of pay – a maximum basic award would be £12,000 for a termination from 1 February 2011. The compensatory award relates to loss of earnings (including other employment benefits) and can be substantially higher.