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Employee Dismissal Procedures

Getting this wrong can be expensive so we look at the key procedures to follow. Dismissing an employee can be a tricky business and the correct procedures need to be followed.

The dismissal must be fair and can include reasons such as inappropriate behaviour or inability to do the job.

Under current legislation, after two years of service, an employee can make a claim for unfair dismissal. However, the Employment Rights Bill, introduced in October 2024, proposes granting employees the right to claim unfair dismissal from the first day of employment. This change is anticipated to take effect no earlier than Autumn 2026.

Fair Procedures and the ACAS Code

Since October 2004 employers have been required to detail the dismissal and disciplinary procedures in writing and issue them to employees.

Since April 2009, the former statutory disciplinary and dismissal procedures no longer apply in England, Wales and Scotland. Instead, employers must follow a fair and reasonable process, taking guidance from the ACAS Code of Practice on Disciplinary and Grievance Procedures.

Failure to follow the ACAS Code does not make an employer automatically liable — but if a dismissal is found to be unfair, a tribunal may increase any compensation award by up to 25% for non-compliance.

Key points under the ACAS Code include:

• Conducting a fair investigation before any disciplinary action
• Informing the employee of the issue in writing
• Holding a formal disciplinary meeting where the employee can respond
• Allowing the employee to be accompanied
• Giving the employee the right to appeal any disciplinary decision

Employers may still use internal procedures similar to the pre-2009 rules, but this is now optional, not required by law.

Gross misconduct

Gross misconduct is the only situation which may lead to instant dismissal. Even then the employer should suspend the employee on full pay and carry out an investigation and give the employee a chance to explain their side. What constitutes gross misconduct can vary depending on the circumstances and employers should give plenty of examples of what they consider to be gross misconduct. Examples include...

• Violent behaviour
• Theft
• Bullying
• Serious insubordination
• Use of alcohol or drugs at work

Initial Period of Employment
As of April 2025, the forthcoming Employment Rights Bill also introduces an 'Initial Period of Employment' (IPE), intended as a statutory probationary period. During this period, expected to last between 3 to 9 months (subject to consultation), employers may be permitted to follow a more streamlined dismissal process for reasons related to conduct, capability, statutory restrictions, or other substantial reasons directly connected to the employee. The exact procedures and protections during the IPE will be defined in future regulations.

It's important to note that these proposed changes are subject to further consultation and are not expected to come into force until Autumn 2026. Employers should stay informed about these developments to ensure compliance once the new regulations are implemented.

How We Can Help You

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