Ending the employment relationship with a staff member is always challenging for everyone involved. You may have a good reason for wanting to dismiss an employee, for example, your company may need to downsize for economic reasons or you may want to get rid of an employee with behavioural/performance issues. Nevertheless, terminating someone is never pleasant or easy and can feel like a pretty daunting process.
Furthermore, if the dismissal is not carried out lawfully, the employee could be entitled to bring a claim in an employment tribunal for unfair dismissal, or wrongful dismissal, meaning it is essential to get things right.
So, if your business finds itself needing to let an employee go, how can you ensure that you do so fairly and per the law? It is important to understand how to approach dismissals and seek advice from a legal professional who can assist you throughout the process. In this guide, we take you through the basics of how to effectively manage an employee’s poor performance or misconduct and if it comes to it, how to carry out a fair and lawful dismissal, thus limiting your exposure to a claim for unfair dismissal.
Dealing with Challenging Employees
Sometimes, your business will have to deal with employees who are disruptive, difficult with colleagues and clients, and unwilling to learn or adapt to your company’s needs. This affects their productivity, but it can also undermine team morale and the productivity of the business as a whole, thus effectively sabotaging your business in the long term.
There is a general perception that employment law in the UK makes it difficult to dismiss employees, irrespective of the negative impact they might be having on your business. This leads to some employers shying away from dealing with underperforming or difficult employees because of worries about breaching employment legislation. However, this is not the case so long as the dismissal is for a ‘fair’ reason under the law and you have acted reasonably throughout the disciplinary process and dismissal.
Our video below suggests some helpful tips on how to identify ‘saboteurs’ in your business who need to be managed more proactively.
Reducing the Risk of Unfair Dismissal
Having identified the saboteurs in your business, it is important to understand what action you should take. Before you take any drastic steps, it is important to first have a strategy for managing any issues relating to conduct or performance early on to try and encourage improvement. Depending on the circumstances, you may be able to positively influence and encourage behavioural change. However, in other cases, you may need to ultimately escalate it to disciplinary action.
In any event, it is crucial to deal with any issues promptly so that, should you need to start a formal process in the future, you have a record of the informal measures you took in the first instance to try and assist the employee in improving their performance or conduct. In addressing the issue, however, ensure that you are managing the employee in a constructive and supportive way. This will reduce the chances of them claiming that you seriously breached the employment contract, thus allowing them to resign and claim constructive dismissal.
Informal Steps to Manage Performance or Conduct
If an employee’s performance or conduct does not meet your standards, you should try and help them improve. Below are some steps that you can take to address poor performance or misconduct.
- Communicate expectations to ensure that your employees are clear about your expectations. This will make it less likely that you will need to manage performance issues some years down the line.
- Monitor and provide feedback to manage poor performance or conduct. This will be easier to do if you have the correct systems, such as appraisal schemes and capability procedures, in place and if they are more than a tick-box exercise. Ensure feedback addressing poor performance or conduct is given calmly and objectively and describe the impact of the employee’s behaviour. Then tell them what is expected going forward (making sure that you are specific with what you expect, for example, that work needs to be completed within agreed deadlines) and give them a chance to respond or ask for support. It may be that extra training or opportunities to improve the issues might alleviate the problem.
- Keep a record on file regarding any conversations or put a summary of the discussion in writing to the employee.
- Have a formal meeting to discuss the issues in greater depth if problems continue. Again, emphasise to the employee that the company is willing to support them or provide extra training and be clear on what needs to be done by them and by what timeline. This meeting should again be followed up by a written communication to the employee outlining the outcome of the meeting so that it is clear what is expected from them.
The above strategies may lead to improvement and in line with the Acas Code of Practice for discipline and grievance, you should always make sure that the employee has had enough time to improve before disciplinary procedures and dismissal are considered. Sometimes, however, informal discussions aren’t enough and you may need to take a formal approach to managing poor performance or conduct by starting a disciplinary procedure.
Our video below provides more helpful tips when managing negative or underperforming employees that will reduce the risk of an unfair dismissal claim being brought against you further down the line. Note that unfair dismissal claims can only be brought where the employee meets the qualifying two-year service requirement needed to bring such a claim. However, even if the employee has less than this amount of service, they may still be able to bring a wrongful dismissal claim. This is a breach of the contract of employment and will normally occur when an individual has been dismissed and the employer has failed to pay or provide notice as stipulated in the contract or has failed to comply with a contractual disciplinary procedure before dismissal.
Fair Reasons for Dismissal
Sometimes, however, things just do not work out and after the correct procedures are followed and all alternative options are explored, terminating the contract may be your only remaining option. In such circumstances, however, you must ensure that the dismissal is for one of the five reasons for dismissal that are deemed legally fair under the Employment Rights Act 1996. These are as follows:
- Conduct. This is where the employee has done something unacceptable or inappropriate that is so serious that it fundamentally damages the employment relationship. It can be a single act of serious misconduct or a succession of less serious acts. Examples include poor attendance or unexplained absence, bullying and harassment.
- Capability. This is typically poor performance, ill health or qualifications.
- Illegality. Where continuing to employ someone would contravene the law. For example, when the employee’s right to work in the UK has expired or when someone is employed as a driver but they lose their licence.
- Redundancy. Where the employee’s role no longer exists within the business or where work they are employed to do is no longer required.
- Some other substantial reasons. For example, a conflict of interest has arisen with the employer’s legitimate business interests, such as a personality clash with a major client.
Gross Misconduct
Gross Misconduct is conduct, actions or behaviour from an employee that is so serious that it justifies instant dismissal.
It is the kind of behaviour that causes damage to the business or its reputation or irreparably breaks trust and confidence in the employer/employee relationship. Examples include theft, damage to company property, physical violence or offensive behaviour.
Most companies will set out what constitutes gross misconduct in the contract of employment, employee handbook or disciplinary policy.
For more information on fair reasons for dismissal, refer to our video on Fair or Unfair Dismissals below.
Reasonableness of the Dismissal
As well as having a fair reason for dismissal, you must also act reasonably in treating that reason as sufficient for dismissal and follow a full and fair procedure.
Following a Fair Dismissal Process
To protect yourself from an employment tribunal claim, you should make sure that you have conducted a thorough and fair investigation into the incident/s that led to the decision to dismiss the employee and follow the dismissal procedure set out in your employment contract, and in the case of misconduct or poor performance, the Acas code of Practice. The Code sets out practical steps as to how an employer should handle disciplinary and grievance situations. Among other things, it suggests that employers investigate the issues, inform the employee of the issue in writing, conduct a disciplinary hearing or meeting with the employee and inform them of the decision.
You should still follow fair and reasonable disciplinary processes in the case of gross misconduct.
For further information on how to carry out a fair dismissal procedure, including how to deal with an instance of gross misconduct, see our informative video below on the Five Musts of Fair Dismissal.
Acting Reasonably
You may be able to show that dismissal was for a permitted reason, but if you are taken to an employment tribunal, the employment tribunal will also have to decide whether you acted reasonably in dismissing.
To establish that an employer acted reasonably, the dismissal in question would need to fall within a range of reasonable responses that a reasonable employer in those circumstances and in that business may have adopted. Each case will depend on its circumstances, but various factors, such as the employer’s size and its administrative resources, and previous decisions made in similar circumstances concerning other employees, may be taken into account in deciding whether the employer acted reasonably in treating that reason as a sufficient reason for dismissal.
Our video on ‘Is a Dismissal Reasonable’ now provides more guidance on ensuring that a dismissal relating to misconduct is reasonable.
Next Steps for Your Business
If you have an employee that you are considering dismissing, it is important to take professional advice from an employment law expert before embarking on a dismissal.
John Cato, who appears in the videos, is now enjoying his retirement but we have a team of expert employment lawyers who can guide you through the process to ensure dismissals are dealt with fairly and do not result in potential liability for your business. We are also on hand with clear advice and help for you on all aspects of employment law, including drafting or improving work policies, such as disciplinary and grievance policies, contracts of employment or employee handbooks so that they are tailored to your business. Contact our employment law team today via email.
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