Automatically Unfair Dismissal: UK Employer Guide

There are certain circumstances in which a dismissal may be classed as automatically unfair, regardless of the employee’s length of service.

It’s a common misconception that an employee that has not yet accrued two years’ continuous service can be dismissed without the need to provide a fair reason or to follow a fair process.

If an employee can show that they have been dismissed for a reason the law considers to be automatically unfair, they may be able to bring a claim against their employer to the Employment Tribunal, irrespective of how long they have worked for the organisation.

To avoid costly tribunal claims, employers therefore need to understand how to dismiss an employee lawfully and when a dismissal could be deemed automatically unfair.

 

What is automatically unfair dismissal?

 

An automatically unfair dismissal is a dismissal that is so inherently unfair that an employee is not required to prove two years’ continuous service. This is because employees are afforded specific proection by law if dismissed in circumstances where the dismissal violates their basic employment rights. The only exception is where the employee is dismissed because of a TUPE transfer.

Where an employee is able prove one of the reasons prohibited by law, there is also no need for them to show that their employer acted unreasonably or failed to follow a fair procedure, as is necessary to establish the basis of an ordinary unfair dismissal claim. The reason, in itself, will be considered automatically unfair, with no further consideration as to either the reasonableness of the decision to dismiss or the procedural fairness of the employer’s actions.

 

How do automatically unfair dismissals differ from unfair dismissals?

 

Unfair dismissal is a far more difficult type of claim for an aggrieved employee to bring when compared with automatically unfair dismissal, not least because this requires a minimum of two years’ service, as well as sufficient evidence to show that the employer is unable to satisfy the two-stage test for a fair dismissal.

If the employer can show that they had a potentially fair reason for dismissing the employee and they acted reasonably in treating that reason as sufficient for dismissal, following a fair process throughout – unless the employee can show that the reason advanced by the employer for the dismissal is wrong, and/or that the decision to dismiss was in any event unfair – the claim will fail.

There are five statutory fair reasons for dismissing an employee: capability; conduct; redundancy; illegality, where continued employment would result in a breach of a statutory restriction; or some other substantial reason (SOSR). SOSR is a ‘catch-all’ provision that allows an employer to fairly dismiss an employee where no other potentially fair reason applies, for example, where there has been a breakdown in the mutual trust and confidence between the parties.

These statutory reasons cover a wide range of scenarios that an employer can rely upon, especially capability and conduct, where an employer can point to various different types of misconduct or poor performance issues, as long as the employee was given fair warning where appropriate, and the decision to dismiss fell within a range of reasonable responses in all the circumstances.

In some cases, an employer may even be justified in summarily dismissing an employee, ie; without notice or pay in lieu of notice. This is usually where the employer has clear evidence of gross misconduct on the part of the employee, such as fraud, theft, physical violence at work, intoxication through either drink or drugs, serious breaches of health and safety, or serious insubordination.

 

What reasons count as automatically unfair dismissal?

 

Grounds for dismissal that are deemed to be automatically unfair require no qualifying period of employment for an unfair dismissal claim to be brought.

There are around 60 different grounds upon which an employee can claim for automatically unfair dismissal before an employment tribunal, primarily designed to protect the basic statutory rights of employees.

Examples of reasons with the widest application where it would be classed as automatically unfair include any reason connected to:

 

• Pregnancy, including all reasons relating to maternity
• Taking or seeking to take leave for family reasons, including statutory paternity leave, adoption leave or shared parental leave
• Taking or seeking to take leave for family emergencies or taking time off to care for dependants
• Acting as an employee representative
• Acting as a trade union representative
• Acting as an occupational pension scheme trustee
• Joining or not joining a trade union
• For taking part in protected industrial action
• Being a part-time or fixed-term employee
• Pay and working hours, including the Working Time Regulations, annual leave and the National Minimum Wage
• For asserting, or trying to assert, a statutory right
• For undertaking jury service
• For making a protected disclosure, i.e; whistleblowing
• For taking action at work on health and safety grounds

 

This list is not exhaustive, where there are several other grounds that may mean an employee has the basis of a claim for automatically unfair dismissal.

Further, it is important to be aware that if you dismiss an employee for a reason related to a protected characteristic under the Equality Act 2010 – such as age, disability, race, religion, sex or sexual orientation – this would not only amount to an automatically unfair dismissal, but also unlawful discrimination.

 

Examples of automatically unfair dismissals

 

 

For a reason connected with pregnancy or maternity

 

Dismissal for a reason connected with pregnancy or maternity is an automatically unfair reason for dismissal. This means that if an employee is dismissed because she is pregnant or off work sick with a pregnancy-related illness, or on maternity leave, she may be able to claim for automatically unfair dismissal regardless of how long she has worked for you.

In addition to being eligible to claim for automatically unfair dismissal, an employee dismissed for any reason connected with her pregnancy or maternity may also be able to claim for unlawful discrimination, for which you can be ordered to pay an uncapped award of damages.

You will not be able to escape liability by arguing that either the employee has not accrued two years’ service, as this protection arises from day one of their employment. You will also be unable to defend your decision to dismiss on grounds of what is reasonable in all the circumstances.

 

For taking action at work on health and safety grounds

 

To dismiss an employee because they have complained about or refused to work in unsafe working conditions could amount to automatically unfair dismissal, regardless of how long they have worked for you.

It is worth noting here that the employee would not need to show that serious and imminent danger actually existed, but simply that they held a reasonable belief that attending work would put them in such danger.

 

Employee rights where automatically unfair dismissal applies

 

Once an automatically unfair reason for dismissal has been established, the employer will no longer be able to justify or defend their decision to dismiss in any way, as they could in a claim for ordinary unfair dismissal. The tribunal will have no cause to consider whether or not the employer acted reasonably in reaching this decision. The dismissal will simply be classed as automatically unfair and the employee will succeed in their claim.

If the claim for automatically unfair dismissal is successful, the employee will have a right to damages, and even reinstatement or re-engagement in a different job. The award of damages will comprise a basic and compensatory award.

The basic award is a fixed sum calculated applying a statutory formula based on the employee’s age at the date of dismissal, their gross weekly salary and their length of service, up to the relevant cap and maximum award level. This can be calculated as follows:

 

• 0.5 weeks’ pay for each complete year of employment where the employee was under the age of 22
• 1 week’s pay for each complete year of employment where the employee was aged between 22 and 40
• 1.5 weeks’ pay for each complete year of employment where the employee was aged 41 or over.

 

The compensatory award will reflect any loss of earnings, in addition to a sum of money to compensate for the loss of their statutory rights, ie; that it will take them two years in a new job to get the general right to claim for ordinary unfair dismissal, again up to the relevant cap.

However, there are certain claims for automatically unfair dismissal where the award is uncapped and, consequently, the compensation could be much higher. This includes if you dismissed an individual for taking action on health and safety grounds or because they ‘blew the whistle‘ for wrongdoing in the workplace, as well as where the dismissal amounts to unlawful discrimination.

 

Need assistance?

 

DavidsonMorris’ employment lawyers can help with all aspects of workplace discrimination. Working closely with our specialists in HR, we can advise on positive steps to improve diversity and equality in your organisation, while minimising the legal risk of discrimination claims. For help and advice, speak to our experts.

 

Automatically unfair dismissal FAQs

 

What is automatically unfair dismissal?

Automatically unfair dismissal occurs when an employee is terminated for reasons that breach specific statutory protections, regardless of the employer’s intentions or process followed.

 

What are examples of automatically unfair reasons?

Examples include dismissal for reasons such as pregnancy, whistleblowing, trade union activities, or asserting statutory employment rights like minimum wage or holiday pay.

 

Does length of service matter for claims of automatically unfair dismissal?

No, in most cases, employees do not need to meet the usual two-year qualifying period to claim automatically unfair dismissal. Protection applies from the first day of employment.

 

What is the difference between unfair dismissal and automatically unfair dismissal?

Unfair dismissal involves termination that lacks a fair reason or was carried out without a proper process. Automatically unfair dismissal relates specifically to statutory protections, where the reason for dismissal is deemed unlawful by its nature.

 

How can employers defend against a claim of automatically unfair dismissal?

Employers must show that the dismissal was not related to the protected reason claimed by the employee. Clear documentation and lawful decision-making are essential.

 

What compensation is awarded for automatically unfair dismissal?

Compensation typically includes a basic award and a compensatory award, with no upper limit for certain cases like whistleblowing or health and safety-related dismissals.

 

Are all employees protected from automatically unfair dismissal?

Yes, protection applies to all employees, including those on part-time, fixed-term, or zero-hours contracts, provided they are classed as employees under employment law.

 

What should employers do if they suspect a dismissal could fall into this category?

Seek legal advice before proceeding with termination to ensure compliance with employment laws and to minimise the risk of tribunal claims.

 

Can redundancy be considered automatically unfair?

If the redundancy selection process is based on a protected characteristic or reason, such as pregnancy or whistleblowing, it may be deemed automatically unfair.

 

What are the consequences of an automatically unfair dismissal claim?

Employers could face tribunal proceedings, financial penalties, and damage to their reputation if found liable. Proactive measures and legal compliance are crucial to avoid such outcomes.

 

Glossary

 

Term	Definition
Automatically Unfair Dismissal	A termination of employment that is unlawful because it breaches specific statutory protections, regardless of process followed.
Statutory Protection	Legal safeguards provided to employees under UK employment law, such as protection from discrimination or retaliation.
Qualifying Period	The length of continuous employment required to claim ordinary unfair dismissal, typically two years. Not required for automatic unfair dismissal.
Whistleblowing	Reporting wrongdoing or illegal activities within an organisation, protected under the Public Interest Disclosure Act 1998.
Trade Union Activities	Actions related to joining, organising, or participating in trade union activities, protected under UK employment law.
Pregnancy Discrimination	Unfair treatment or dismissal of an employee due to pregnancy, maternity leave, or related reasons, deemed automatically unfair.
Basic Award	A statutory compensation payment calculated based on age, length of service, and weekly pay in cases of unfair dismissal.
Compensatory Award	Additional compensation awarded by a tribunal for financial losses resulting from unfair dismissal.
Protected Characteristic	Traits safeguarded under the Equality Act 2010, such as age, race, gender, and disability.
Health and Safety Activities	Employee actions to report or address workplace health and safety concerns, protected from retaliation or dismissal.
Redundancy	A legitimate reason for dismissal due to reduced need for work, which can be deemed automatically unfair if improperly applied.
Tribunal	A legal body that resolves employment disputes, including claims of automatically unfair dismissal.
Zero-Hours Contract	A type of employment contract where the employer is not obliged to provide minimum working hours, but statutory protections still apply.
Fixed-Term Contract	An employment contract set for a specific duration or project, with statutory protections against unfair dismissal.
Dismissal Process	The steps an employer takes to terminate an employee, which must comply with legal requirements to avoid unfair claims.
Protected Disclosure	Information disclosed by an employee about wrongdoing in the workplace, safeguarded under whistleblowing laws.
Constructive Dismissal	A form of dismissal where an employee resigns due to the employer’s breach of contract, such as creating a hostile environment.
Employment Rights Act 1996	Key UK legislation outlining employee rights, including protection from unfair dismissal.