Unfair & wrongful dismissal claims

We assist employers to defend themselves effectively against unfair and wrongful dismissal claims.

Usually (although not always) the fact that there has been a dismissal is not in dispute.

In some cases, employees may claim to have been constructively dismissed, on the basis that the employer has fundamentally breached the contract of employment. There are often good grounds for the employer to deny that there has been any such constructive dismissal.

For unfair dismissal purposes, assuming that there has been a dismissal the onus is on the employer to show that the reason for the dismissal comes within the definition of “fair”. This can be misconduct, lack of capability, illegality, redundancy or “some other substantial reason” justifying dismissal.

In relation to each of those “fair” reasons a body of case law has developed as to the procedural and other steps that a reasonable employer would usually be expected to take before deciding to dismiss.

Some reasons for dismissal are automatically unfair, such as in health and safety-related cases, or for making a protected disclosure, for union membership or activities, for asserting certain statutory rights or for taking maternity or parental leave.

In most cases, compensation for unfair dismissal is capped at the lower of one year’s contractual pay or a maximum limit which is updated annually (£78,962 from 6 April 2016). However, in some cases, compensation is uncapped, such as in health and safety-related cases, or where the dismissal is for making a protected disclosure or amounts to unlawful discrimination.

Wrongful dismissal claims are concerned with dismissals alleged to be in breach of contract. They often arise where the employer considers that the employee is in serious breach of contract and has terminated the contract of employment without notice. The employee disputes that he or she was in serious breach of contract and claims damages as a result. The damages can be very substantial for highly remunerated employees, particularly where the notice period is long. Often one of the main arguments concerns the extent to which any potential damages should be reduced to reflect the employee’s duty to mitigate loss, such as by seeking new employment.

Our assistance to employers in this area includes:

  • advising in relation to the prospects of successfully defending claims;
  • negotiating favourable settlement at an early stage if appropriate;
  • drafting robust defence documents;
  • preparation of the defence case, including mutual disclosure of documents and exchange of witness statements;
  • advising in relation to strategy and tactics;
  • advising in relation to issues of quantum, for example as regards:
    • dealing with the loss of bonuses and/or share/LTIP awards;
    • the claimant’s duty to mitigate loss; and
    • (in unfair dismissal cases) reductions in compensation as a result of the claimant’s contribution to the dismissal and/or the likelihood that the claimant would have been dismissed even if a fair procedure had been followed.
  • entering into settlement negotiations where appropriate; drafting and concluding settlement agreements where negotiations are successful;
  • dealing with appeals to the Employment Appeal Tribunal and higher Courts where appropriate.