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15th July 2026
Dismissing an employee is almost never straightforward. Even where there seems to be a clear reason for ending employment, the way a dismissal is handled really can make all the difference.
A lot of Employment Tribunal claims aren’t brought because an employer lacked a valid reason to dismiss someone. Rather, they arise because the correct process wasn’t followed, evidence wasn’t gathered properly, or decisions were made too quickly.
With employment law continuing to evolve, and proposed changes under the Employment Rights Act likely to increase protections for employees over the coming years, employers are under growing pressure to demonstrate that every dismissal is both fair and reasonable.
For SMEs, this can feel like a difficult balancing act. Businesses need to make commercial decisions, manage performance, deal with misconduct and protect the wider workforce. At the same time, they need to minimise the risk of costly tribunal claims and reputational damage.
Understanding what unfair dismissal is, when employees can bring a claim and what the law expects from employers, is the first step towards making confident decisions.
In this guide, we’ll explain the principles behind unfair dismissal, look at the reasons a dismissal may be considered fair or unfair, and explore how businesses can reduce risk through practical HR support.
In simple terms, unfair dismissal occurs when an employee is dismissed without a fair reason or without the employer following a fair procedure.
UK employment law recognises that employers have the right to dismiss employees where there is a legitimate business reason for doing so. However, that right is balanced by protections designed to prevent employees from being dismissed arbitrarily or unreasonably.
This means that having a valid reason for dismissal is only part of the picture. An employer might have genuine concerns about an employee’s conduct or capability, but if they fail to investigate properly, deny the employee an opportunity to respond, or ignore their own disciplinary procedures, the dismissal may still be judged unfair.
Employment Tribunals don’t simply ask whether an employer reached the “right” decision. They look at whether the employer acted reasonably in all the circumstances, followed a fair process and made a decision that another reasonable employer could also have reached. That distinction catches many businesses out.
As employment legislation develops and tribunal scrutiny increases, employers are expected to demonstrate that every significant employment decision has been carefully considered and appropriately documented.
As our Director, Michael Dobson FCIPD, puts it:
“One of the biggest misconceptions I come across is that having a good reason to dismiss someone automatically protects an employer. But really, the process is often just as important as the reason itself. A rushed investigation or inconsistent approach can quickly undermine what might otherwise have been a fair dismissal.”
As it stands, the right to claim unfair dismissal begins after two years of continuous service with the same employer. Under the Employment Rights Act 2025, the qualifying period is set to reduce to just six months from the 1 January 2027, meaning employers will need to ensure robust recruitment, probation and performance management processes from the very start of employment.
Under the current qualifying period, continuous service generally includes periods of authorised absence such as maternity leave, sickness absence, and annual leave, meaning employees may qualify even if they have spent significant periods away from work.
However, there are important exceptions. Some dismissals are classed as automatically unfair, meaning employees may be able to bring a claim regardless of how long they have worked for the organisation.
Examples include dismissals connected to:
In these situations, the length of service is largely irrelevant. If the reason for dismissal falls into one of these protected categories, an employer might face a claim from day one of employment.
It’s also worth remembering that unfair dismissal claims are often brought alongside other claims, particularly discrimination or wrongful dismissal. While the two are frequently confused, they deal with different legal issues.
Unfair dismissal focuses on the fairness of the employer’s decision and process, whereas wrongful dismissal is usually concerned with breaches of contract, such as failing to provide the correct notice period.
Not every dismissal is unfair. The Employment Rights Act 1996 sets out five potentially fair reasons for dismissal. The word ‘potentially’ is key because simply falling into one of these categories doesn’t automatically make a dismissal lawful. Employers still need to demonstrate that they acted reasonably and followed an appropriate procedure.
Conduct is one of the most common reasons employers dismiss employees. This might involve repeated misconduct, breaches of company policy, persistent lateness, dishonesty, or, in more serious cases, gross misconduct.
Before reaching a decision, employers should investigate the allegations thoroughly, gather evidence, allow the employee to respond, and follow their disciplinary procedure. Skipping any of these steps can create problems down the line.
Sometimes an employee is simply unable to perform their role to the required standard. Poor performance might stem from a lack of skills, insufficient training, ill health, or an inability to meet reasonable objectives. In these situations, dismissal should normally be a last resort.
Employers are generally expected to identify the issues, offer appropriate support, provide opportunities to improve, and review progress over a reasonable period before considering dismissal.
The same principle often applies to long-term sickness absence. While capability dismissals related to ill health can be fair, they require careful handling, medical evidence, and meaningful consultation throughout the process.
Redundancy occurs when a business no longer requires employees to carry out particular work. This might happen because of restructuring, workplace closures, reduced demand, or changes in how work is organised.
Even where redundancy is genuine, employers must still follow a fair process. That includes selecting employees fairly, consulting appropriately, and considering suitable alternative employment where possible. Where larger-scale restructures are involved, employers may also have collective consultation obligations.
Occasionally, an employee can no longer legally continue in their role. Examples might include a driver losing their driving licence where driving is an essential part of the job, or an employee losing the professional registration needed to practise.
If continuing the employment would breach the law, dismissal might be justified. Even then, employers should explore whether any reasonable alternatives exist before making a final decision.
This final category covers situations that don’t neatly fit elsewhere but may still justify dismissal. SOSR dismissals can include business reorganisations, irretrievable breakdowns in working relationships, third-party pressure, or changes to contractual arrangements where agreement cannot be reached.
Because this category is so broad, employers should approach it carefully. Tribunals will expect to see a genuine business reason supported by a fair and well-documented process.
Whatever the reason for dismissal, one principle remains constant. A fair reason alone isn’t enough. Employers also need to be able to demonstrate that they investigated properly, communicated openly, followed their procedures, and reached a decision that was reasonable in the circumstances.
That combination of sound reasoning and a fair process is what places employers in the strongest possible position should their decision ever be challenged.
Understanding what makes a dismissal unfair often boils down to a simple question: Did the employer act reasonably?
Tribunals don’t expect employers to make perfect decisions every time. But what they do expect is that decisions follow a fair procedure and fall within the range of responses that another reasonable employer might’ve reached.
A dismissal can, therefore, be considered unfair for a whole host of reasons. Sometimes the employer simply doesn’t have a legally fair reason for dismissing the employee. In other cases, the reason itself might be entirely legitimate, but the process lets the employer down.
For example, an employee accused of misconduct should usually be informed of the allegations against them, given access to the evidence, invited to a disciplinary hearing, allowed to state their case, and offered the right of appeal. Missing any of these stages can weaken an employer’s position if the decision is later challenged.
On a similar note, dismissing an employee for poor performance without first identifying the issues, setting realistic expectations, and providing support to improve is unlikely to be viewed favourably by an Employment Tribunal.
Consistency also matters. If two employees commit the same misconduct but receive very different outcomes without a clear reason, questions are likely to be asked about the fairness of the employer’s decision-making.
Employers should also remember that some dismissals are automatically unfair, regardless of length of service, as we mentioned earlier. These include dismissals connected to pregnancy, whistleblowing, trade union activities, certain health and safety matters, and the assertion of statutory employment rights.
The common thread running through all these situations is fairness. Employees should understand what concerns exist, have a genuine opportunity to respond, and be treated consistently throughout the process.
Ashley Gray MCIPD, our HR Operations Director, says:
“Dismissal should never feel like a foregone conclusion. Even where concerns appear clear, employers should approach every situation with an open mind, investigate thoroughly, and allow employees the opportunity to respond. That’s what tribunals expect to see.”
Most unfair dismissal claims don’t arise because employers deliberately ignore employment law. More often, they stem from small procedural mistakes that accumulate over the course of a disciplinary or capability process. Here are some common mistakes we see:
When problems arise, particularly serious allegations of misconduct, there can be pressure to resolve matters immediately. However, rushing an investigation often means important evidence is overlooked or assumptions are made before all the facts have been established.
Managers may have held several informal conversations about an employee’s performance or conduct but failed to document them properly. Months later, when those conversations become relevant, there is little evidence to demonstrate what was discussed or what support was offered.
This can also become a challenge, especially in growing businesses where different managers deal with similar situations in different ways. Without clear policies and HR oversight, one employee may receive coaching while another faces formal disciplinary action for comparable behaviour.
Employees should understand what concerns exist, what standards are expected of them and what the possible outcomes are. Surprising someone with a dismissal that they had little opportunity to influence is rarely a strong starting point should the matter progress to tribunal.
Finally, employers sometimes focus so heavily on the immediate issue that they overlook the wider legal context. A dismissal linked to sickness absence, for example, might also involve disability discrimination considerations. Likewise, dismissing an employee after they’ve raised concerns about workplace safety can create additional legal risks that extend well beyond unfair dismissal alone.
Handling dismissals is one of the areas where businesses often benefit most from experienced HR support. We work with employers across the North East and beyond to help them make confident, well-informed decisions at every stage of the employment relationship.
Sometimes that means advising on a single disciplinary matter with on-demand support. In other cases, we’re helping businesses through more complex restructures or employee relations issues with ongoing support. Our approach is always practical. Rather than simply quoting legislation, we help employers apply it to real situations.
That could involve anything from reviewing the circumstances before formal action is taken, advising on investigations, preparing letters and meeting documentation, supporting managers through difficult conversations, or helping businesses follow fair disciplinary and dismissal procedures from start to finish.
Where dismissal becomes the appropriate outcome, we’ll help you reach that point with confidence, knowing the process has been properly documented and managed.
On the other hand, there are many occasions where early HR advice helps employers avoid dismissal altogether by identifying alternative solutions that protect both the business and the employment relationship.
As employment law continues to change, having access to experienced HR professionals allows businesses to focus on running their organisation while knowing their people decisions are supported by current best practice. If you’d like practical advice tailored to your organisation, get in touch with Sapphire HR today.
Here to Help, Not Replace Experts:
The information contained in this blog presented for general informational purposes only. While we strive to provide accurate and up-to-date content, legal and HR practices can evolve rapidly. This blog is not a substitute for professional advice.
For specific questions or concerns regarding your unique situation, we highly recommend taking professional advice and booking a consultation with a Sapphire HR Consultant. Our consultants are experts in the field and can provide tailored guidance to address your specific needs.
We aim to work truly in partnership with our client organisations and to develop a high-quality, competent HR Service for all clients, the HR Provider that they can rely on and who gets to understand the culture and vision of your business.
