28 February 2013

Dismissing an Employee - Business Briefing

Following the Supreme Court’s recent confirmation in Societe Generale, London Branch v Geys as to the correct approach to take when making a payment in lieu of notice to an employee, we provide a business briefing on the key steps a business should follow when considering dismissing an employee.

This business briefing sets out the key steps a business should follow when it is considering dismissing an employee.
Why is it important to follow the law when dismissing an employee?

Dismissing an employee for a reason other than one allowed by law, without following the correct procedure or giving adequate notice, may lead to a claim for unfair/wrongful dismissal against the business.  Compensation for a successful claim can potentially be substantial.  Regardless of whether a claim succeeds, the costs of defending it (in terms of management time and legal costs) may be significant and are not usually recoverable.
Establish whether there are grounds for dismissal.  There are several potentially fair reasons for dismissing an employee:
their conduct at work (e.g. they have filed a fraudulent expenses claim);
their inability to carry out their job because they lack the necessary skills required (e.g. a sales manager has consistently failed to meet reasonable sales targets despite receiving additional support and training);
their absence on long-term sick leave and inability to return to their job;
their job is redundant (e.g. if the business is declining or the workplace is facing closure). Do not use redundancy as an easy alternative to dismissing an employee for poor performance. The “redundant” employee could make a claim for unfair dismissal;
their continued employment would be illegal (e.g. the business has discovered that an employee’s immigration status does not permit them to work)...read more
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