Wake-up call – Beware pitfalls of changes to unfair dismissal rules

27 April 2012
Wake-up call – Beware pitfalls of changes to unfair dismissal rules

The qualifying period for unfair dismissal has increased from one to two years. This gives operators more confidence in recruiting, but there are still pitfalls, warns legal expert Emilie Bennetts

The Problem
I have heard that the one-year qualifying period for an employee to bring a claim for unfair dismissal is about to increase. Is this correct and what do I need to know about this? Does it affect my current employees?

The Law
Currently, an employee must have one year's service in order to be able to bring a claim for unfair dismissal to an employment tribunal - unless the claim is for automatic unfair dismissal, which does not have a qualifying period of service in order to be able to bring a claim.

It is true that the qualifying period for an employee to bring a claim for unfair dismissal increased from one year to two years on 6 April. The Government decided to implement this change as it believes this will improve business confidence in recruiting staff and level the playing field between employer and employee. It is anticipated that this will cut the number of unfair dismissal claims by 3,000 a year.

This change will only affect those employees who are recruited on or after 6 April 2012, so a company's existing employees will not be affected. This means that employers will effectively have a two-tier workforce: employees recruited before 6 April 2012 with one year's service who do have unfair dismissal protection, and employees recruited after 6 April 2012 with one year's service who don't have unfair dismissal protection.

Expert Advice
An employee doesn't need to have a period of qualifying service in order to bring a claim for discrimination or for "automatic" unfair dismissal. Automatic unfair dismissals include dismissals for reasons connected with pregnancy or childbirth, for a reason connected to trade union membership, for a health and safety reason, whistle-blowing or because of an employee's fixed-term status.

A disgruntled employee who has been dismissed may attempt to bring a claim for discrimination or automatic unfair dismissal if he or she doesn't have unfair dismissal protection. It is, therefore, always best practice to minimise any inference of discrimination - although such a claim may be spurious, it could be time consuming and expensive to defend.

Employers should, therefore, always give consideration to identifying and documenting the fair reason for the dismissal - for example, poor performance or misconduct - at the time of the dismissal, and following a procedure in carrying out the dismissal, even if the employee doesn't have the qualifying period of service to bring an unfair dismissal claim.

Although an employer may make the commercial decision to relax the dismissal procedure where the employee doesn't have qualifying service, as a minimum a meeting should be held with the employee so that the employer's reason for the dismissal can be shared with them, and to give them the opportunity to state their case. This meeting should be documented and a letter should also be sent to the employee confirming the reason for the dismissal and the date of termination.


â- Even if an employee doesn't have qualifying service, always consider identifying the reason for dismissal, holding a meeting and writing to them to confirm their termination date and why they have been dismissed.

Employers should not be complacent about how they treat employees who do not have unfair dismissal protection. These employees can still bring claims for discrimination or for automatic unfair dismissal. Although such a claim may be weak, they can be expensive and time consuming to defend.

It is also easier to defend a discrimination claim if a fair reason for the dismissal was identified and shared with the employee at the time. Employers should, therefore, always consider doing this.

Emilie Bennetts is a solicitor at Charles Russell LLP

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