Running a small or medium-sized business, while often incredibly rewarding, can also present a whole host of challenges. You need to juggle finances, run operations, maintain customer relations, and, perhaps most challenging of all, manage people. As an employer, you may find yourself in a situation where an employee is simply not working out as you had hoped, and you want to terminate their contract. If this is you, rest assured that you are not alone. Our HR consultants are frequently approached by clients asking, ‘Can I sack someone for no reason?’
Here, our expert HR consultants explain the situations in which you can lawfully terminate an employee’s contract of employment, the potential ramifications of dismissing an employee when you do not have the legal right to do so, and the steps you can take to minimise the risk of being stuck with a problematic employee.
Call us now on 01491 598 600 or Click Here to Make An Enquiry and we will be delighted to help you.
What Rights Do Employees Have?
The law applicable to dismissing staff depends on how long they have worked for your organisation.
- Employees with less than two years’ service generally do not have the right to claim unfair dismissal. However, they may be able to make a claim for automatic unfair dismissal or discrimination.
- Employees with more than two years’ service benefit from protection from unfair dismissal. This means that you must have a fair reason for dismissing the employee, and you must follow a fair procedure before terminating their employment.
When Can You Lawfully Sack Someone?
The law sets out five potentially fair reasons for dismissal. They are as follows:
- Conduct. Conduct issues, such as persistent lateness or dishonesty, can be valid reasons for terminating a person’s contract of employment.
- Capability. Capability issues relate to somebody’s poor performance or inability to do their job.
- Redundancy. If an employee’s role is genuinely redundant, you may be able to lawfully terminate their contract of employment.
- Legal reason – this refers to where an employee cannot do their job without breaking the law. For example, if a delivery driver lost their driver’s licence, you would have a fair reason for dismissing them.
- Some other substantial reason. This catch-all category covers a wide range of possible scenarios. Examples of some situations that might constitute a substantial reason include if an employee will not agree to new terms and conditions of employment or the employee’s fixed-term contract has come to an end.
Crucially, even if your situation falls squarely into one of the categories listed above, you must still follow a fair procedure before terminating the employee’s contract of employment with your organisation. A fair procedure usually involves (in brief) investigating the issue, meeting with the employee, considering the evidence, and reaching a balanced decision. Our HR consultants will explain the procedure you should follow and support you as you navigate it.
What Happens If You Sack Someone For No Reason?
Sacking someone for no reason can expose your organisation to legal claims by the disgruntled employee. Depending on the situation, the employee might pursue your organisation for the following:
- An unfair dismissal claim. If the employee has over two years’ service with your organisation, they may be entitled to make an unfair dismissal claim against you.
- An automatically unfair dismissal claim. Some dismissals are classed as automatically unfair and enable an employee with less than two years’ service to make a claim against an organisation. Some examples of reasons for dismissal that are automatically unfair include when an employee is dismissed for asserting their statutory rights or raising health and safety concerns, being a member of a trade union, or performing jury service.
- A discrimination claim. Employees are protected from discrimination on the grounds of age, sex, disability, race, religion, and sexual orientation from day one of their employment.
Compensation In Discrimination Claims Is Uncapped
In addition to facing legal claims, sacking someone on the spot can cause tension among your workforce and damage your organisation’s wider reputation.
How Can You Deal With A Problematic Employee?
Since you cannot sack someone for no reason, you should put measures in place to minimise the risk of being unable to dismiss an employee with whom you are unhappy.
For example, most employers include probationary periods in their contracts of employment. Probationary periods give you the opportunity to assess an employee’s performance and terminate their contract with you should it be necessary to do so. Most probationary periods are either three or six months long, but you can decide on the period most appropriate to your organisation. There is no legal maximum probationary period, but anything longer than six months may be deemed unfair.
Our HR consultants will review your current practices and advise you on any additional protections you can build in to protect yourself from being stuck with problematic employees.
Call us now on 01491 598 600 or Click Here to Make An Enquiry and we will be delighted to help you.
