Employee Dismissal and Legal Grounds

Q1

3. Discuss and critically analyse, the scope and limitations of employers wishing to dismiss an employee if they commit an act of misconduct and the potential financial implications if this is not done correctly.

In the case of misconduct as a ground for dismissal of the employee, there are some important considerations for the employer to bear in mind. First, the ERA 1996, Section 98(4) is applicable, and it is on this basis that it is assessed whether it is unfair to dismiss an employee. Second, the importance of ACAS Code of Practice has to be considered because this is also relevant to the dismissal process. Third, and importantly, the procedural requirements in misconduct cases provided in BHS v Burchell, have to be ensured. According to the decision, the employer’s decision to dismiss an employee for misconduct must be based on honest belief; reasonable grounds for the belief; and reasonable investigation. Thus, the employer must establish that they had genuine belief that the employee was guilty of the alleged misconduct, and that they carried out a reasonable investigation. What this means is that the employer cannot dismiss the employee for misconduct unless they can establish these important points. This test of employer’s belief and investigation has been upheld by courts; an example can be seen in Reilly v Sandwell Metropolitan Borough Council, where the dismissal was upheld as being reasonable if the employee was involved in misconduct even if not in breach conditions of the employment contract. In Game Retail Ltd., use of personal Twitter handle to post offensive tweets was upheld by the Employment Appeal Tribunal and came within the reasonable responses test. In Creighton, the Employment Appeal Tribunal was concerned with whether the company had conducted disciplinary proceedings and investigations into the allegations of misconduct before dismissal. What these cases indicate is that if the employers base their decision to dismiss the employee on reasonable belief and after conducting reasonable investigations, then the courts take a more favourable approach to the dismissal decisions and this indicates the need for employers to ensure that such procedural and other requirements are met by the employer before employees are dismissed. On the other hand, if the employer is not able to justify the decision, then the employer may have to pay compensation to the employee. Furthermore, Section 127A of the ERA 1996 provides for additional compensation to be payable in circumstances where the employer has an appeal procedure but prevents the employee from using it.

Q2

Reduction in employees

1. Stephen Taylor and Astra Emir, Employment law: an introduction (Oxford University Press 2015) p. 100.
2. West Midlands Co-Operative Society Ltd. v. Tipton [1986] W.L.R. 306.
3. British Home Stores v Burchell [1980] ICR 303.
4. Ibid, [304], per Arnold J.
5. Reilly v Sandwell Metropolitan Borough Council [2018] UKSC 16.
6. Game Retail Ltd v Laws UKEAT/0188/14/DA.
7. Creighton v Together Housing Association Ltd ET/2400978/2016.

This issue concerns the changes for reduction in the number of employees in Ealing branch of Gina's Dog Grooming Parlour which currently employs 5 dog groomers and two receptionists but wants to scale down to 4 dog groomers and one receptionist. This issue relates to redundancy. Redundancy is given as a fair reason for dismissal and it is defined in Sections 95 and 136 ERA 1996. One of the justifications for redundancy is that although the business of the employer is existing, the job has disappeared. Section 139(b) provides that redundancy may happen when the requirement for the employee to carry out the work has ceased to exist. Thus, the business requirements may have diminished. It may also be the case that the employment posts have remained, but the number of posts have to be reduced. Redundancy can be justified if there are some objective requirements that are met by redundancy although the employer cannot justify redundancy simply by stating that this is for “the overall requirements of the business”, which is a subjective criterion.

In Langston v Cranfield University, it was held that in a claim for unfair dismissal by reason of redundancy, employees can claim unfairness on grounds of unfair selection, lack of consultation, and failure to seek alternative employment. Therefore, an important question in this situation is the basis on which the employer will decide which dog groomer among the five and which receptionist among the two, will be made redundant. Those who made redundant, can claim unfairness of selection. Selection can be done on the basis of those who are in longer service being rewarded by selection and this has been held to be a reasonable and legitimate employment policy where the employer’s criterion was that this was a proportionate means to achieve the legitimate aim of rewarding loyalty and achieving a stable workforce. Thus, in this case, selection can be done on the basis of the length of service, with those employees with least service being made redundant. With respect to consultation, there is no separate duty on an employer to warn employees about redundancy and consultation itself is part of the same process of warning and consultation begins with warning to the employees. However, whether or not consultation was followed will be part of the discussion on legality of the dismissal. Consultations are required to ensure that employees are disclosed the reasons for redundancy, the number of employees being made redundant, the method of selection, and the description of employees being made redundant. Thus, the employer is advised to carry out consultations, have a specific criterion for selection which is justified. Employees who have worked for more than 2 years will also be entitled to statutory redundancy payment.

George

The issue in this situation is whether the George’s complaints of work without rest are justified and whether dismissal of George under the circumstances would be illegal. In this situation, George is employed as a dog groomer in the Hanwell branch and has been working here for 8 months including on Saturdays and Sundays. George has complained to about having to work from 8-6 pm without a break while the manager says that these were the busiest days and others did not seem to mind. The Working Time Regulations 1998 that enacted the Working Time Directive is relevant here. According to these Regulations, employees have rights with respect to working time, minimum daily and weekly rest periods, and also rest breaks. The objective of the law is to ensure minimum daily, weekly and annual periods of rest and adequate breaks and for that purpose place a maximum limit on weekly working hours. The Working Time Regulations 1998 applies to all employees, including trainees and agents. According to these Regulations, periods during which the worker is working count as working time. At the same time, there is no bar on employees and employers contractually agreeing to more hours of work while those who are not in favour of doing so can opt out. Therefore, if some employees are not opposed to working without rest, as the manager has argued, this does not mean that others may not oppose it, because the law does allow the employer to make the employee work without rest. Moreover, there are penalties for non-compliance. The right to rest has been recognised by the tribunals in the UK; for instance, the Employment Appeal Tribunal has held that employees are entitled to one rest break after six hours. Firms can face fine for failure to comply with requirements of the law. Therefore, George is within his rights to complain if he is not receiving a rest break and is working Sundays.

1. Safeway Stores plc v Burrell [1997] 1 WLUK 332.
2. Watkins v Crouch [2011] IRLR 382 (eat).
3. Langston v Cranfield University [1998] IRLR 172.
4. Rolls Royce v Tnite [2009] IRLR 576 (c/a).
5. Elkouil v Coney Island Ltd [2002] IRLR 174 (eat).
6. Shanahan Engineering v Unite (UKEAT/04 11/09).

Regarding the second issue, which is that Fred has informed Sharon that he thinks George is a troublemaker and would like to tell him that his services are no longer needed at the end of his shift next weekend, this involves dismissal. For dismissal to be justified, it has to be done on one of the grounds provided. First, every employee has the right to not be unfairly dismissed by his employer (section 94(1) ERA 1996). However, the employee has to be been continuously employed for a period of not less than two years to be eligible to claim unfair dismissal (Section 108(1) ERA 1996). Nevertheless, dismissal can still be challenged by an employee who is employed for less than 2 years if the dismissal falls within the category of ‘automatically unfair’ dismissals (Section 108(3) ERA 1996). The reason for dismissal can be automatically unfair under Section 108 ERA 1996 if it is in response to an exercise by employees of rights under the Working Time Regulations (Section 101A ERA 1996). Telling George that his services are no longer required would be an express dismissal (Section 95 ERA 1996) and telling it to him in response to his complaint about work without rest would amount to an automatically unfair’ dismissal under Section 101A ERA 1996. This may qualify George to bring a claim of unfair dismissal even though his service is only for 8 months. Once he is so qualified, then the burden shifts on the employer to demonstrate a potentially fair reason for dismissal.

1. Hugh Collins, Keith Ewing, and Aileen McColgan, Labour law (Cambridge University Press 2019) p.308.
2. Edwards & Anor v Encirc Ltd UKEAT/0367/14/DM.
3. Pfeiffer v Deutsches Rotes Kreuz, Kreisverband Waldshut eV (2005) C-397/01-403/01.
4. Corps Of Commissionaires Management Ltd v Hughes [2009] IRLR 122 EAT.

Take a deeper dive into Distinctions between Self-Employed, Employee, Worker, and Agency Worker with our additional resources.

Table of cases

British Home Stores v Burchell [1980] ICR 303.

Corps Of Commissionaires Management Ltd v Hughes [2009] IRLR 122 EAT.

Creighton v Together Housing Association Ltd ET/2400978/2016.

Edwards & Anor v Encirc Ltd UKEAT/0367/14/DM.

Elkouil v Coney Island Ltd [2002] IRLR 174 (eat).

Game Retail Ltd v Laws UKEAT/0188/14/DA.

Langston v Cranfield University [1998] IRLR 172.

Pfeiffer v Deutsches Rotes Kreuz, Kreisverband Waldshut eV (2005) C-397/01-403/01.

Reilly v Sandwell Metropolitan Borough Council [2018] UKSC 16.

Rolls Royce v Tnite [2009] IRLR 576 (c/a).

Safeway Stores plc v Burrell [1997] 1 WLUK 332.

Shanahan Engineering v Unite (UKEAT/04 11/09).

Watkins v Crouch [2011] IRLR 382 (eat).

West Midlands Co-Operative Society Ltd. v. Tipton [1986] W.L.R. 306.

Books

Collins H, Keith Ewing, and Aileen McColgan, Labour law (Cambridge University Press 2019).

Taylor S and Astra Emir, Employment law: an introduction (Oxford University Press 2015).