Key Takeaways
| Critical Point | Legal Detail |
|---|---|
| Qualifying Period | Most employees need two years’ continuous service to claim unfair dismissal, though automatic unfair dismissal claims (whistleblowing, discrimination) require no qualifying period under the Employment Rights Act 1996. |
| Time Limits Matter | You must submit your claim to an Employment Tribunal within three months minus one day of your dismissal date, with very limited exceptions for extensions. |
| Fair Reasons Exist | Employers can fairly dismiss for capability, conduct, redundancy, statutory restrictions, or “some other substantial reason” – but they must follow proper procedure throughout. |
| Compensation Caps Apply | Basic awards cap at £21,000 (2024/25), whilst compensatory awards generally max out at £115,115 or one year’s gross salary, whichever is lower. |
| Procedure Trumps Reason | Even with a fair reason for dismissal, tribunals regularly find dismissals unfair when employers fail to follow the ACAS Code of Practice on disciplinary procedures. |
| Automatic Protections | Dismissals relating to pregnancy, health and safety concerns, or asserting statutory rights are automatically unfair regardless of service length, as confirmed in Kuzel v Roche Products Ltd. |
Introduction
Sarah turned up for her shift at the warehouse on Monday morning. Her manager called her into the office. Five minutes later, she walked out without a job. No warning. No investigation. Just a vague claim about “not fitting in with the team.”
This happens more often than you’d think across Britain. Moreover, many dismissed employees don’t realise they have legal rights that protect them from arbitrary sackings.
Unfair dismissal law exists to balance employer flexibility with employee security. Nevertheless, understanding whether you’ve been unfairly dismissed requires navigating complex employment legislation and tribunal procedures.
Throughout this guide, you’ll discover the legal tests tribunals apply, the procedures employers must follow, and the remedies available when things go wrong. Furthermore, we’ll break down the compensation calculations, time limits, and practical steps for pursuing a claim.
By the end, you’ll know exactly where you stand and what to do next.
What Counts as Unfair Dismissal Under UK Law
Unfair dismissal occurs when your employer terminates your contract without a fair reason or without following proper procedure. The Employment Rights Act 1996 sets out the framework. Subsequently, thousands of tribunal cases have refined how courts interpret these rules.
The Two-Part Legal Test
Tribunals apply a straightforward test. First, they ask whether the employer had a potentially fair reason for dismissal. Then, they examine whether the employer acted reasonably in treating that reason as sufficient grounds for sacking you.
Both elements must stack up. Otherwise, your dismissal fails the legal test.
Employers can rely on five potentially fair reasons: capability (including ill health), conduct (such as gross misconduct), redundancy, statutory bar (like losing a driving licence when driving is essential), or “some other substantial reason.” However, having a fair reason isn’t enough on its own.
The second part trips up many employers. Even with a legitimate concern about your performance or behaviour, they must investigate properly, give you a chance to respond, and consider alternatives to dismissal. Rushing this process typically results in unfair dismissal findings.
Automatically Unfair Dismissals
Some dismissals are automatically unfair regardless of your length of service. These include dismissals for:
- Pregnancy or maternity-related reasons
- Whistleblowing about illegal practices or safety concerns
- Asserting statutory employment rights (such as requesting flexible working)
- Trade union membership or activities
- Taking action on health and safety grounds
- Refusing to work on Sundays (for shop workers)
Subsequently, if your dismissal connects to any of these protected reasons, you can claim immediately without needing two years’ service. The burden shifts to your employer to prove the dismissal had nothing to do with the protected activity.
I’ve seen cases where employers claimed performance issues, but the timing told a different story. When someone raises a grievance about safety on Monday and gets sacked for “attitude problems” on Friday, tribunals rarely believe the coincidence.
Constructive Unfair Dismissal
You don’t actually need to be sacked to claim unfair dismissal. Constructive dismissal occurs when your employer’s conduct forces you to resign.
The legal test comes from Western Excavating (ECC) Ltd v Sharp. Your employer must commit a fundamental breach of contract that destroys the employment relationship. Furthermore, you must resign in response to that breach without affirming the contract first.
Common examples include serious bullying, sudden pay cuts without agreement, or failure to address serious health and safety risks. However, simply being unhappy at work isn’t enough. The breach must be fundamental.
One crucial point: you should generally raise a formal grievance before resigning. Additionally, don’t delay too long after the breach occurs. Continuing to work normally for months suggests you’ve accepted the situation, making constructive dismissal harder to prove.
If you’re considering this route, contact us for specific advice before handing in your notice. Timing matters enormously in these cases.
Understanding Your Qualifying Period and Eligibility
Most unfair dismissal claims require two years’ continuous employment with the same employer. This qualifying period starts from your first day of work and includes notice periods, even if you’re not working during notice.
Calculating Continuous Service
Your start date determines everything. Gaps in employment can break continuity, though certain gaps don’t count against you. For instance, pregnancy-related absences, strikes, and temporary lay-offs typically preserve continuity under the Employment Rights Act 1996.
Transferring between connected employers usually maintains your continuous service. If Company A sells its business to Company B under TUPE regulations, your service with Company A counts towards your qualifying period with Company B.
I once advised someone who’d worked for the same organisation for eighteen months, then got promoted into a different legal entity within the same group. She worried this reset her clock. It didn’t. The companies were associated employers, so her service carried over seamlessly.
Exceptions to the Two-Year Rule
Several categories of dismissal require no qualifying period whatsoever. Discrimination dismissals fall into this bracket. Therefore, if you’re sacked because of your age, disability, race, religion, sex, sexual orientation, gender reassignment, pregnancy, or marriage status, you can claim immediately.
Similarly, whistleblowing dismissals bypass the qualifying period entirely. Raise concerns about criminal offences, health and safety dangers, environmental damage, or cover-ups, and you’re protected from day one under the Public Interest Disclosure Act 1998.
Health and safety dismissals also carry automatic protection. Taking reasonable steps to protect yourself or others from serious danger can’t form the basis for lawful dismissal, regardless of service length.
- Asserting statutory rights (minimum wage, working time, maternity leave)
- Trade union membership or activities
- Requesting flexible working arrangements
- Taking family or parental leave
- Refusing to work illegally or unsafely
Each of these scenarios grants immediate protection against dismissal.
Agency Workers and Atypical Arrangements
Agency workers face particular challenges. Your qualifying period depends on whether you’re truly an agency worker or actually an employee of the end-user. Furthermore, umbrella company arrangements can complicate matters significantly.
Tribunals look at the reality of your working relationship, not just the paperwork. Control, integration, and mutuality of obligation all matter. Consequently, you might have more rights than your contract suggests.
Fixed-term contracts count towards continuous service just like permanent contracts. When your fixed-term contract expires, that can constitute dismissal for unfair dismissal purposes if you’ve got the qualifying service.
Zero-hours workers accumulate service too, though calculating it requires careful analysis of your work pattern. Continuous service doesn’t require continuous work – it’s about the employment relationship continuing, even if actual work fluctuates.
For complex employment arrangements, seeking expert legal advice early helps clarify your position before deadlines pass.
The Dismissal Process: What Employers Must Do
Procedural fairness matters as much as substantive fairness. Your employer can have a perfectly good reason to dismiss you, but still lose at tribunal by failing to follow proper procedure. The ACAS Code of Practice sets out the minimum standards employers must meet.
Investigation and Evidence Gathering
Before disciplining you, your employer must investigate the allegations properly. This means gathering relevant evidence, interviewing witnesses, and building a clear picture of what allegedly happened. Rushing to conclusions without adequate investigation regularly results in unfair dismissal findings.
The investigation should be proportionate to the seriousness of the alleged issue. Suspected gross misconduct requires more thorough investigation than a minor performance concern. Nevertheless, even for straightforward matters, employers must check basic facts before proceeding.
I’ve seen cases where managers assumed they knew what happened without speaking to key witnesses. Subsequently, tribunals found the dismissals unfair because proper investigation might have revealed a different picture entirely. Employers must keep an open mind throughout the investigation stage.
The Disciplinary Hearing
Once investigation concludes, your employer must invite you to a formal disciplinary hearing. The invitation should:
- Give you reasonable notice (usually at least 48 hours)
- Explain the allegations against you in sufficient detail
- Provide copies of relevant evidence beforehand
- Inform you of your right to be accompanied
- Specify the potential consequences, including possible dismissal
During the hearing, you’re entitled to bring a companion – either a trade union representative or a workplace colleague. Your companion can address the hearing, confer with you, and ask for adjournments, but can’t answer questions on your behalf.
The hearing must be a genuine two-way discussion. Your employer should present their case, give you full opportunity to respond, and consider your explanations fairly. Simply going through the motions whilst having already decided to dismiss you won’t satisfy the procedural requirements.
After the hearing, your employer should take time to consider everything before making a decision. Immediate decisions made in the heat of the moment suggest they haven’t properly weighed the evidence.
Your Right to Appeal
Every dismissal decision must include information about your appeal rights. Furthermore, your employer must genuinely consider any appeal you submit, not simply rubber-stamp the original decision.
The appeal should ideally be heard by someone more senior than the person who made the dismissal decision. Fresh eyes on the case help ensure fairness. Additionally, the appeal can consider both the original decision and any procedural defects in reaching it.
New evidence can emerge during appeals. Your employer must consider this properly rather than sticking rigidly to the original decision. An effective appeal can remedy earlier procedural failures, though serious procedural flaws from the outset make this difficult.
Time limits for appeals vary between employers, but you should generally appeal within five working days of receiving the dismissal decision. Don’t delay – tribunals expect you to exhaust internal procedures before claiming.
For guidance on personal injury claims arising from workplace incidents, separate legal principles apply.
Bringing Your Unfair Dismissal Claim
Time moves fast once you’re dismissed. The deadline for submitting your Employment Tribunal claim is three months minus one day from your effective date of termination. Miss this deadline, and tribunals have very limited power to extend time, even if your case has merit.
Early Conciliation Through ACAS
Before lodging a tribunal claim, you must notify ACAS for early conciliation. This isn’t optional – it’s a mandatory gateway step. Subsequently, ACAS contacts your employer to explore settlement possibilities without going to tribunal.
Early conciliation pauses the three-month deadline whilst ACAS works with both parties. The pause lasts for the conciliation period plus an additional period, giving you breathing room to negotiate. However, you must still act promptly to protect your position.
Many cases settle during early conciliation. Your employer might offer compensation to avoid tribunal proceedings, especially if they recognise procedural weaknesses in how they handled your dismissal. Nevertheless, don’t feel pressured to accept inadequate offers just because settlement seems easier than fighting.
Completing the ET1 Claim Form
When conciliation doesn’t resolve matters, you submit your claim using form ET1. This document sets out your case, so accuracy matters. You’ll need to:
- Identify yourself and your employer correctly
- Specify the type of claim (unfair dismissal)
- Provide your employment dates
- State your salary and benefits
- Explain what happened and why you believe the dismissal was unfair
- Indicate what remedy you’re seeking
Your ET1 grounds form the basis of your case. Therefore, include sufficient detail to explain your position, but save the full evidence for later stages. You’re not writing a novel – just a clear summary of your key points.
Tribunal fees were abolished in 2017 following the R (on the application of UNISON) v Lord Chancellor case. Consequently, you don’t pay anything to submit your claim, removing a significant barrier to justice.
What Happens After You Submit
Your employer receives your claim and must respond within 28 days using form ET3. Their response sets out their defence, explaining why they believe the dismissal was fair and procedurally correct.
Once both forms are in, the tribunal serves a case management order. This sets deadlines for exchanging documents, witness statements, and preparing bundles. Additionally, it often schedules a preliminary hearing to clarify issues and give case management directions.
Most cases settle before the final hearing. Tribunals actively encourage settlement through judicial mediation and settlement weeks. Mind you, if settlement doesn’t happen, you’ll proceed to a full hearing where an employment judge (and sometimes two lay members) will hear evidence and make a decision.
The process typically takes 6-12 months from claim submission to final hearing, though simple cases can resolve faster. Complex cases with multiple claims or parties take longer.
For accident at work claims, different procedures apply through the personal injury system rather than employment tribunals.
Remedies and Compensation for Unfair Dismissal
Winning your case doesn’t automatically mean getting your job back. In fact, reinstatement happens rarely. Instead, most successful claimants receive financial compensation calculated according to specific rules.
The Basic Award
Your basic award mirrors statutory redundancy pay calculations. It’s based on your age, length of service, and gross weekly pay (capped at £700 for 2024/25). The calculation works as follows:
- Half a week’s pay for each complete year of service under age 22
- One week’s pay for each complete year between 22 and 40
- One and a half weeks’ pay for each complete year aged 41 or over
Service caps at 20 years maximum. Therefore, the highest possible basic award currently stands at £21,000 (20 years × 1.5 × £700).
However, tribunals can reduce your basic award for contributory conduct. If your behaviour contributed to your dismissal (even though the dismissal was still unfair), the tribunal reduces the award by whatever percentage reflects your contribution. I’ve seen reductions ranging from 10% to 75%, depending on the circumstances.
The Compensatory Award
This award compensates you for actual financial losses flowing from the unfair dismissal. It covers loss of earnings from dismissal until the tribunal hearing, plus estimated future losses if you’re still unemployed.
Your duty to mitigate losses matters significantly. You must take reasonable steps to find alternative employment. Turning down suitable jobs without good reason reduces your compensatory award. Consequently, document your job search efforts carefully.
The compensatory award can include:
- Loss of statutory rights (usually £500)
- Loss of pension contributions
- Loss of company benefits (car, health insurance, etc.)
- Expenses incurred finding new work
- Loss of earnings (past and future)
Future loss calculations require tribunals to estimate how long you’ll remain unemployed. This depends on factors like your age, skills, location, and job market conditions. Therefore, bringing evidence about your job search efforts and market conditions strengthens your case.
The compensatory award caps at either £115,115 (2024/25) or one year’s gross salary, whichever is lower. However, certain automatically unfair dismissals (whistleblowing, health and safety) carry no cap whatsoever.
Reinstatement and Re-engagement
Tribunals can order your employer to give you your job back. Reinstatement means returning to your exact previous role with full continuity and back pay. Re-engagement means a different but comparable role with the same employer.
These orders happen rarely in practice. Employers often argue the employment relationship has broken down irretrievably. Furthermore, tribunals recognise that forcing parties back together against their will rarely works long-term.
If a tribunal makes a reinstatement or re-engagement order and your employer refuses to comply, you receive:
- Your normal compensation awards, plus
- An additional award of between 26 and 52 weeks’ pay
This creates significant financial pressure on employers to comply with reinstatement orders.
Nevertheless, most claimants prefer compensation over reinstatement anyway. Starting afresh with a new employer often makes more sense than returning to a difficult situation. Discuss your preferences with your legal adviser early in the process.
Tax Treatment of Awards
Basic awards are generally tax-free up to £30,000. Compensatory awards for loss of earnings are taxable income. However, the first £30,000 of total compensation (combining all elements except future loss of earnings) typically escapes tax.
Consequently, how tribunals break down awards between different categories affects your net recovery. An experienced employment lawyer structures compensation claims to maximise your tax-efficient recovery where possible.
Frequently Asked Questions About Unfair Dismissal
Can I claim unfair dismissal if I’ve been employed for less than two years?
Generally, no – unless your dismissal falls into an automatically unfair category. These include dismissals for whistleblowing, discrimination, pregnancy, health and safety concerns, or asserting statutory rights. For these protected reasons, you can claim from day one. Otherwise, you need two years’ continuous service before the effective date of termination to bring an ordinary unfair dismissal claim under the Employment Rights Act 1996.
What if I was made redundant – can that be unfair dismissal?
Absolutely. Whilst redundancy is potentially a fair reason for dismissal, the selection process must be fair and reasonable. If your employer failed to consult properly, applied unfair selection criteria, or didn’t consider suitable alternative roles, your redundancy dismissal might be unfair. Furthermore, if the redundancy was a sham to get rid of you for other reasons, that’s automatically unfair dismissal.
How much compensation might I receive for unfair dismissal?
Compensation varies enormously based on your salary, age, service length, and how quickly you find new work. Basic awards max out at £21,000, whilst compensatory awards cap at £115,115 or one year’s gross pay (whichever is lower) for most cases. However, your actual award depends on your specific circumstances and losses. Successful claimants typically receive between £5,000 and £25,000, though awards outside this range occur regularly.
Can I claim unfair dismissal if I resigned?
Yes, through constructive dismissal – but only if your employer’s serious breach of contract forced you to resign. Simply being unhappy doesn’t suffice. The breach must be fundamental (such as serious bullying, unlawful pay cuts, or dangerous working conditions) and you must resign in response without delay. Additionally, you should raise a grievance before resigning to give your employer chance to fix the problem. This is a complex area where specialist advice proves invaluable.
What’s the deadline for bringing an unfair dismissal claim?
You must submit your Employment Tribunal claim within three months minus one day of your effective date of termination. This deadline is strict, with very limited exceptions. Before submitting, you must complete ACAS early conciliation, which pauses the deadline during conciliation. Therefore, don’t wait until the last minute – contact ACAS within the first month of dismissal to protect your position whilst exploring settlement.
Will I need to attend a tribunal hearing?
Possibly not. Most unfair dismissal claims settle before reaching a full hearing. Early conciliation, judicial mediation, and settlement negotiations resolve the majority of cases. Nevertheless, you should prepare as though you’ll attend tribunal. If settlement doesn’t happen, you’ll need to give evidence, face cross-examination, and potentially testify for several hours. Having expert legal representation significantly improves your prospects at hearing.
Can I get my job back after unfair dismissal?
Tribunals have power to order reinstatement or re-engagement, but this happens rarely. Most successful claimants receive compensation instead. If you genuinely want your job back, tell your representative early because this affects how they present your case. Tribunals consider whether reinstatement is practical and whether you actually want to return. Most claimants prefer a clean break with fair compensation over returning to a difficult workplace.
What if I was dismissed whilst off sick?
Dismissing someone during sick leave can be fair, but only if handled correctly. Your employer must investigate the situation properly, obtain medical evidence (usually through occupational health), consider reasonable adjustments, and consult with you before deciding. Dismissing someone simply because they’re off sick often amounts to disability discrimination or unfair dismissal. The length and nature of your absence, your job role, and business impact all factor into whether dismissal was reasonable.
Legal Disclaimer
This article is intended for informational purposes only and does not constitute legal advice. For specific advice relating to your circumstances, please contact Wolf Law directly to arrange a consultation with one of our qualified solicitors.
