It may become apparent quite quickly when an employee joins your business that they aren’t the right person for the role. There could be issues with underperformance or even concerns about their conduct or attendance and although this can be frustrating due to the time and effort it has taken you to recruit, onboard and train them, it may be necessary to dismiss them within a relatively short period of time.
But, it may not be as easy as just advising your employee that they have been dismissed?
Although an employee can’t raise a claim for an 'ordinary' unfair dismissal before two years' service, if the reason for dismissal is linked to a potentially discriminatory reason, the dismissal could be deemed as automatically unfair, which does not require a minimum length of service. This means your business could be liable to pay a compensatory award of up to £115,115.
In this bIog I cover:
The risks of dismissing staff with short service
Reasons which would be considered automatically unfair if you ended up at an employment tribunal
Guidance for dismissing staff with short service
A list of FAQs with how to manage the situation
What is the risk in dismissing employees with short service?
It is commonly assumed that dismissing staff with short service is much more straightforward and easier than dismissing a long serving employee. This can sometimes be the case however employers should be aware of the potential risks when dismissing an employee with less than two years’ service.
Whilst the qualifying length of service for an unfair dismissal claim is two years, there are other claims that your employee could raise against you if the reason for the dismissal is considered to be ‘automatically unfair’ or discriminatory.
Automatically unfair reasons for dismissal
Automatically unfair reasons for dismissal include:
TUPE transfer (where the reason is not an economic, technical or organisational reason entailing changes in the workforce).
Family-related reasons, such as pregnancy, maternity leave, adoption leave or shared parental leave
Whistleblowing
Refusing to give up a right under the Working Time Regulations 1998 (SI 1998/1833), for example the right to a rest period;
Taking action to enforce the right to be paid the national minimum wage;
Trade union membership or activities;
If your employee can argue they have been dismissed due to a protected characteristic, they could raise a discrimination claim against you.
The protected characteristics within the Equality Act 2010 are:
age
disability
sex
gender reassignment
pregnancy and maternity
race
sexual orientation
religion or belief
marriage and civil partnership
It is very important to consider these exceptions when dismissing staff with short service because there is no ceiling on the amount of compensation that can be awarded if a discrimination claim is successful. In 2022/23 the average disability discrimination compensation award was £45,435 so it is important any short service dismissal is not linked to any of the protected characteristics above.
You should always consider following the The Acas Code of Practice on discipline and grievance as this non statutory code sets out the standards for fairness and Employment Tribunals are legally required to take the Acas Code of Practice into account when considering relevant cases. An Employment Tribunal can adjust awards by up to 25 per cent for an unreasonable failure to comply with any provisions of the code.
The Employment Rights Act 1996 provides five potentially fair reasons for dismissal,
Capability,
Misconduct,
Redundancy,
Statutory restriction
SOSR (some other substantial reason)
If you are dismissing an employee for one of the above reasons then it’s likely that the dismissal will be fair if you have followed a fair process. In a situation where your employee has less than two years’ service and has no protected characteristics then it’s likely you will be able to shorten the process in order to dismiss your employee.
It’s not always easy to decide how to approach a dismissal situation with a short serving employee so here is some guidance and answers to some frequently asked questions:
Guidance for dismissing short-service employees
1. Have clear procedures in place
It’s not necessary to have a separate policy and procedure in place for short and long serving employees but it is always advisable to make sure your published procedures make reference to the fact that the company may adopt a shortened version of the process, or no process, where an individual has less than two years’ service.
2. Always double check the start date
The length of the probationary period will usually vary depending on the nature of the role but it’s advisable to have a minimum of 3 months to give both you and your new employee enough time to determine if the hire is right for your business.
3. Treat each case on its own merits
It is not possible to have a blanket approach for all short serving employees because the circumstances of each case will be different. In some cases it might be sensible for you to follow a more robust process when there are further risks associated with a potential disability or other protected characteristic.
4. Make use of probationary periods
Probationary periods are an excellent way of determining if the employee is right for the business and vice versa. Use this time to identify any training needs and make sure your employees receive a proper induction to give them the best possible chance of success. It is If things aren’t working out, it often becomes clear at an early stage and if it becomes clear part way through your employee’s probationary period and they are for example, underperforming, you should not wait until the end of this period to address the issues. In some cases things may improve but if not, a dismissal can feel more reasonable from your employee’s perspective if this is during their probationary period and can make it easier for you to address as the employer.
5. How would the dismissal look to an Employment Tribunal?
As mentioned, dismissing an employee with less than two years’ service means they cannot claim unfair dismissal but as outlined in this blog there are other claims your employee could potentially bring such as wrongful dismissal, breach of contract and discrimination. It is therefore important to always consider what information or evidence you would be able to produce to demonstrate the reason for the dismissal if needed. In the absence of any evidence, it will be difficult to defend a potential discrimination claim so it is always worth keeping notes of all meetings to refer back to.
Frequently Asked Questions
Do I need to give a short serving employee a reason for their dismissal?
Legally as an employer you are required to give an employee with less than two years’ service a written statement outlining the reason for their dismissal. However, it is advisable to give your employee a written reason for their dismissal so that should the employee argue they have been dismissed due to a discriminatory reason, you are more likely to be able to defend a claim. In the absence of any documentation outlining the reason for the dismissal, it’s likely to be very difficult to put forward a defence.
Do I need to give a short serving employee the right to appeal against their dismissal?
No, There is no legal obligation to provide your short serving employee the right to appeal against their dismissal. However, it’s always recommended so that in the event that the employee does have a protected characteristic or is likely to raise a claim, there is a further stage at which any issues can be addressed internally.
Employees don’t have to exhaust their internal processes before raising a tribunal claim, however using all internal option available to the, it’s would give you as the employer the opportunity to rectify any potential procedural issues and therefore reduce risk in the event of a claim. Within the company procedure you could shorten the appeal process for short serving employees for example, confirm that an appeal will be responded to in writing instead of holding an appeal meeting first.
Do I need to formally invite the employee to a meeting to dismiss them or can I dismiss them on the spot?
I would always recommend writing to the employee to formally invite them to a meeting. This invite should give your employee the right to be accompanied and outline what the potential outcome of the meeting could be i.e. their dismissal. An on the spot dismissal, even where this is due to gross misconduct, is never recommended. Following a process gives you the opportunity to head off any potential discrimination claims that may arise. In addition, it demonstrates that you treat staff fairly.
I have a short serving employee that is underperforming, do I need to follow each step in my performance management procedure before reaching dismissal?
Depending on the wording of your company procedure, it may not be necessary in this situation to follow each step in the performance process and this could therefore be shortened. It would be prudent to hold a meeting with your employee to give them an opportunity to respond and put forward any mitigating factors to consider.
This would give you an opportunity to identify if there are any potential risks to the dismissal before reaching a decision, for instance, if your employee argued that they were underperforming due to a long-term underlying health issue they had not yet disclosed but which may amount to a disability, it would be wise to seek medical advice or support from an Occupational Health provider before deciding on the next steps. However, in the absence of any mitigating factors or protected characteristics then the risk of dismissing your employee at the first stage would be low even where there have been no prior informal discussions regarding the employee’s performance.
Do I need to carry out an investigation into a disciplinary issue before dismissing a short serving employee?
This really depends on the the situation, It is always best to carry out a reasonable investigation to determine the facts of the alleged misconduct however if there are not any protected characteristics and you are confident that the misconduct has occurred then it would be reasonable to invite your employee to a disciplinary hearing with a potential outcome of dismissal without having to carry out an in depth investigation into the matter.
Do I need to have different procedures in place for employees with less than two years’ service?
No, there is no obligation to have different procedures for short serving employees. However, it is useful to outline within the procedures that a process could be shortened for employees with less than two years’ service. For example, in the disciplinary procedure it’s advisable to make reference to employees with less than two years’ service and to explain that the employer may not follow all of the stages in the procedure for short serving employees.
It’s advisable to make company policies non-contractual however, where it is the case that a disciplinary policy is contractual, an employee could claim for breach of contract if the employer has not followed the procedure correctly. There is no qualifying length of service for a breach of contract claim.
Other things to think about before making a short service dismissal
Employers have been known to miscalculate length of service or not consider that the employee is approaching the two year mark. Notice periods can count towards length of service so it’s always important to check and double check your employees start, continuous and end date. If your employee is very close to the two year mark then the safest approach is to treat them as if they have already reached this.
Employers can sometimes become complacent when dealing with employees of under 2 years’ service and are sometimes caught out by miscalculating continuous service (particularly as it applies to notice periods and garden leave) or by failing to identify potential risks. Carrying out a formal hearing prior to making a decision to dismiss is advisable as it can discover any relevant factors that you may have been unaware of, such as an underlying medical condition affecting performance. A meeting creates a record of the grounds for dismissal, which can be crucial in the event of a subsequent legal dispute. It is fairly common for an employee to argue that the ‘true’ grounds for dismissal were very different to those stated by the employer, and in the absence of any documented dismissal procedure, the you would lack credibility in seeking to explain it.
In summary
it is often the case that a dismissal for a short serving employee will be more straight forward and processes will be much less work for the employer, however it’s important not to push on with a fast track dismissal in all cases for short serving employees before assessing the risks. It’s important to be mindful of the potential claims that don’t have a qualifying period such as those outlined above and keep an adequate paper trail to at least show that the reason for the dismissal was not unlawful.
How can I help?
If you need support with updating your procedures or advice on a potential dismissal situation, please get in touch on 0203 137 4658, email me @ contact@minervahrconsulting.co.uk or book in a no obligation chat.
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