By Lucy Nicholl
I've recently been carrying out extensive research on unfair dismissals and wanted to share this comprehensive guide for use by other HR professionals and employers. Unfair dismissal is an important aspect of employment law that demands a deep understanding from employers and HR professionals. I'll provide an extensive overview of unfair dismissal, drawing on relevant case law, statistics, and the ACAS Code of Practice on disciplinary and grievance procedures. I will shed light on recent and potential future developments that could reshape the landscape of unfair dismissal employment regulations in the UK.
Understanding Unfair Dismissal
Unfair dismissal is a significant concern within employment law. Employers must be knowledgeable to ensure fairness and legal compliance. Unfair dismissal occurs when an employer unjustly terminates an employee's contract. This can encompass a range of scenarios, including automatically unfair reasons for dismissal, such as:
Pregnancy and maternity
Family-friendly leave
Acting as an employee or trade union representative
Joining or not joining a trade union
Whistleblowing (reporting wrongdoings)
Working Time Regulations
Being a part-time or fixed-term employee
It can also involve other unjust reasons where there is no reasonable justification for the termination or when the employer fails to follow proper disciplinary or dismissal procedures.
It's important to note that, under the Employment Rights Act 1996, employees must have at least two years of continuous service before they can claim unfair dismissal.
The Significance of the Burchell Test
In 1978, the case of British Home Stores Ltd v. Burchell introduced a pivotal framework for determining the fairness or unfairness of a dismissal, known as the "Burchell Test." According to this test, a dismissal is considered fair if the employer can demonstrate:
A genuine belief in the employee's misconduct.
Reasonable grounds for that belief.
A reasonable investigation was conducted by the employer.
This test originated when Burchell was suspected of abusing staff purchases within British Home Stores and was subsequently dismissed. The industrial tribunal (now employment tribunal) initially found the dismissal unfair due to incorrect evidence presented by management. However, the Employment Appeal Tribunal overturned this decision, establishing the Burchell Test, which was later upheld by the House of Lords. This landmark case provides a valuable tool for people professionals when evaluating dismissal cases involving gross misconduct.
Challenges to the Burchell Test
While the Burchell Test has been widely utilised in unfair dismissal cases since 1978, it has faced criticism and challenges. A notable case is Reilly v. Sandwell Metropolitan Borough Council (2016), where the Supreme Court concluded that the Burchell Test did not entirely fit the circumstances of the case. Reilly, a Head Teacher, was dismissed for not disclosing her friendship with a convicted sex offender, a matter concerning the safeguarding of pupils. Although the Burchell Test contributed to the decision that the employer had valid reasons for dismissal, it was challenging to apply the test to determine fairness when it predominantly assesses the reasonableness of the employer's actions. This case underscores the need for thorough investigations to determine the fairness of dismissal in cases involving actions or choices outside the workplace.
The Emphasis on Following Procedures:
The case of Orr v. Milton Keynes Council (2011), while not directly conflicting with the Burchell Test, highlighted the importance of adhering to the ACAS Code of Practice on disciplinary and grievance procedures when evaluating the fairness of dismissal. The claimant, a youth worker, alleged unfair dismissal for gross misconduct. However, during the investigation and disciplinary process, the claimant's manager failed to disclose essential information to the decision-maker. Although the case was appealed, the Court of Appeals upheld the decision. This case underscores the importance of following internal dismissal and disciplinary procedures in line with the ACAS Code.
Future Developments and Considerations
With 633 successful claims of unfair dismissal in 2021/2022, averaging £13,541 in compensation awards to Claimants (Gov.uk, 2023), it is crucial for HR professionals and employers to stay up-to-date with employment regulations. Future developments may include legislative reforms, evolving case law, and a growing focus on mental health and well-being, which could place additional pressure on employers to ensure fairness in dismissal cases related to mental health issues. Additionally, as technological advancements continue, the aging workforce may face challenges in keeping up with evolving capabilities and training requirements. Therefore, employers should be diligent in adhering to the provisions of the ACAS Code to minimise the risk of unfair dismissal claims and potentially increased compensation awards.
Unfair dismissal is an important area of employment law that requires a comprehensive understanding and adherence to procedures by employers and HR professionals. This briefing note has provided an in-depth exploration of unfair dismissal, its grounds, the significance of the Burchell Test, and the importance of following the ACAS Code. As employment regulations evolve, staying informed and practicing fair procedures are essential to mitigate the risk of unfair dismissal claims and maintain a compliant workplace.
For more information on how I can help you navigate unfair dismissals, book a free consultation at a time that suits you (no obligations):
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