SOSR Dismissal: What Is Some Other Substantial Reason?

To dismiss an employee lawfully, an employer must show a fair reason for dismissal. Under section 98 of the Employment Rights Act 1996, there are five potentially fair reasons for dismissal: conduct, capability or performance, redundancy, breach of a statutory restriction or some other substantial reason (SOSR).

An SOSR dismissal applies where the reason for termination does not fall within conduct, capability, redundancy or illegality, but is still sufficiently serious to justify dismissal. It is the most flexible and frequently misunderstood of the five statutory grounds.

This guide explains what SOSR dismissal means in practice, when it can be relied upon, how tribunals assess it, and how employers can reduce the risk of unfair dismissal claims.

Section A: What Is SOSR Dismissal?

An SOSR dismissal is one of the five potentially fair reasons for dismissal under section 98(1)(b) of the Employment Rights Act 1996. It operates as a residual category, allowing employers to rely on a substantial business reason where the other four statutory grounds do not properly apply.

There is no statutory definition of what qualifies as “substantial”. Case law establishes that the reason must be genuine, significant and objectively capable of justifying dismissal. However, what is definitive is that an SOSR dismissal cannot be trivial, minor or constructed after the event. The employer has to show that SOSR was the real, or principal, reason for the dismissal.

Even where a substantial reason exists, the dismissal will only be fair if the employer acted reasonably in treating that reason as sufficient to justify termination.

1. What does “some other substantial reason” mean in practice?

SOSR dismissal is fact specific. Tribunals look closely at the surrounding circumstances to determine whether the employer’s stated reason is both substantial and genuine.

In practice, SOSR dismissal may include situations such as:

• A serious clash of personalities where working relationships have broken down to the point that continued employment is no longer viable. A mere personality difference will not suffice. The breakdown needs to be significant and supported by evidence. The breakdown must not stem from the employer’s own unreasonable conduct.
• A conflict of interest that undermines trust, for example where an employee has an outside commercial interest in a competing business or a close connection with a competitor that creates a genuine business risk.
• Reputational risk to the business. In regulated or safeguarding-focused sectors, conduct that undermines public confidence or client trust may justify dismissal, provided the employer can demonstrate a real and objectively reasonable risk supported by evidence, rather than speculative concern.
• Proposed changes to terms and conditions that an employee refuses to accept. Where there are sound business reasons for contractual change and consultation has taken place, dismissal and re-engagement may fall within SOSR. Tribunals will scrutinise the business rationale and the fairness of the process closely.
• The return to work of the employee whose absence was being covered. Where someone was engaged to provide temporary cover and that purpose comes to an end, dismissal may amount to SOSR. Clear communication at the outset of the temporary nature of the role is important.
• Pressure from a third party, such as a client refusing to work with a particular employee. Tribunals examine whether the pressure is genuine, whether it has been properly investigated and whether alternatives were explored before dismissal.
• Expiry of a fixed-term contract. Expiry is legally a dismissal under section 95 of the Employment Rights Act 1996. Whether the reason is redundancy or SOSR depends on the underlying circumstances. If the dismissal is attributable to a reduced requirement for employees to carry out work of a particular kind, redundancy may apply. If it relates to completion of a specific project or temporary need, SOSR may be the appropriate classification.

SOSR is not a shortcut. It cannot be used simply because dismissal is administratively convenient or because an employer wishes to avoid using another potentially fair reason. If the real issue concerns conduct, performance or redundancy, it should be addressed under the appropriate category.

2. Is SOSR dismissal automatically fair?

Identifying a substantial reason is only the first step. A dismissal will only be fair if the employer also acts reasonably in treating that reason as sufficient to justify dismissal.

Section 98(4) of the Employment Rights Act 1996 requires tribunals to consider whether, in all the circumstances and having regard to the size and administrative resources of the employer, the employer acted reasonably. That assessment includes examining the procedure followed, whether alternatives to dismissal were considered and whether the decision falls within the range of reasonable responses open to a reasonable employer.

An employer who has a potentially fair SOSR reason but fails to follow a fair process remains exposed to an unfair dismissal claim.

In short, SOSR provides a lawful gateway for dismissal in unusual or business-specific situations. It does not lower the standard of procedural fairness required.

Section B: When Can an Employer Rely on SOSR?

SOSR tends to arise where the employment relationship has broken down or where external business pressures create a situation that does not fit neatly within conduct, capability or redundancy.

Tribunals focus on substance. The employer needs to demonstrate that the reason relied upon is real, significant and supported by evidence. The fact that a situation is commercially inconvenient will not be enough. The question is whether the reason is sufficiently weighty to justify dismissal.

1. Breakdown in trust and confidence

A breakdown in working relationships can justify SOSR dismissal, but the threshold is high. Minor personality clashes or general friction between colleagues will rarely suffice.

Employers should be able to show that the relationship has deteriorated to such an extent that continued employment is no longer workable. Evidence may include failed mediation, documented grievances or attempts to restructure reporting lines. Tribunals will expect to see that reasonable steps were taken to repair the relationship before dismissal was considered.

Where the breakdown involves allegations of misconduct, employers should proceed under a disciplinary framework. Reframing a conduct issue as SOSR creates avoidable risk.

2. Third-party pressure or client refusal

Third-party pressure is one of the most frequently litigated SOSR scenarios. It commonly arises where a client refuses to allow an employee to continue working on its site.

Dismissal may be fair where the pressure is genuine and the employer has limited alternative work available. However, fairness depends on the employer acting reasonably in response to that pressure. Tribunals expect employers to investigate the basis of the client’s concerns, assess whether those concerns are reasonable and consider redeployment or alternative arrangements before moving to dismissal.

The absence of alternative work does not automatically make dismissal fair. The employer must still show that it balanced commercial realities against the employee’s right to fair treatment and that dismissal fell within the range of reasonable responses.

3. Reputational risk

Reputational risk can amount to SOSR where continuing to employ the individual poses a genuine threat to business confidence, regulatory standing or safeguarding obligations.

The assessment is highly fact sensitive. Employers should identify the specific risk, consider whether it is objectively supported by evidence and assess whether lesser measures would address the concern. A subjective or speculative fear of reputational damage is unlikely to justify dismissal. In regulated sectors or roles requiring a high level of public trust, tribunals may accept that reputational concerns carry greater weight, provided the assessment is proportionate.

4. Business reorganisation and contractual change

Where an employer proposes changes to terms and conditions and an employee refuses to agree, dismissal and re-engagement may fall within SOSR.

Tribunals examine whether there were sound business reasons for the change, whether meaningful consultation took place and whether dismissal was a proportionate response. Employers who rely on SOSR in this context should be prepared to demonstrate the commercial rationale behind the changes and the steps taken to secure agreement.

Where the proposed changes arise from a reduced requirement for work of a particular kind, the correct statutory reason may instead be redundancy. Careful classification is required.

5. Fixed-term contracts and temporary cover

The expiry of a fixed-term contract is a dismissal in law. The classification of the reason depends on the underlying facts.

If the dismissal reflects a reduced need for employees to carry out work of a particular kind, redundancy may apply. If the role was genuinely linked to a specific project or temporary cover arrangement that has come to an end, SOSR may be the appropriate ground.

Clear documentation at the outset of the employment relationship and careful analysis at the point of termination reduce the risk of misclassification and subsequent challenge.

Section C: What Procedure Is Required for a Fair SOSR Dismissal?

Even where an employer can point to a substantial reason, the dismissal will only be fair if a reasonable procedure has been followed.

Section 98(4) of the Employment Rights Act 1996 requires tribunals to consider whether the employer acted reasonably in all the circumstances. That assessment includes examining the steps taken before dismissal, the opportunity given to the employee to respond and whether alternatives were properly explored.

The precise procedure will depend on the underlying reason. There is no single template for SOSR cases, but certain safeguards are expected in most situations.

1. Investigation and evidence gathering

Employers should investigate the factual basis of the SOSR before moving to dismissal.

Where the issue concerns third-party pressure, the employer should establish what has been said, why the objection has arisen and whether it is justified. In reputational risk cases, the employer should identify the specific concern and assess its credibility. In breakdown of trust scenarios, evidence of failed interventions or attempts to resolve the issue will be relevant.

A decision taken on assumption or incomplete information is unlikely to be viewed as reasonable.

2. Consultation and opportunity to respond

The employee should be informed of the concerns and invited to a meeting to discuss the potential dismissal. They should be given sufficient information to understand the case against them and a meaningful opportunity to respond.

In most circumstances, the employee has the right to be accompanied by a colleague or trade union representative at a formal meeting.

Consultation is not a formality. Tribunals look for evidence that the employer listened, considered representations and remained open to alternatives before reaching a final decision.

3. Consideration of alternatives to dismissal

Before dismissing for SOSR, employers are expected to consider whether other options are available.

Depending on the facts, alternatives may include redeployment, changes to reporting lines, mediation, adjusted duties or further discussion about contractual changes. The size and administrative resources of the organisation will be relevant. Larger employers are generally expected to explore a wider range of options.

A failure to consider alternatives can undermine an otherwise substantial reason.

4. Decision, notice and right of appeal

If dismissal is confirmed, the employer should set out the reasons clearly in writing, confirm the notice position and inform the employee of their right to appeal.

Where an employee is dismissed for SOSR, they are usually entitled to contractual or statutory notice, whichever is greater. In many cases, the employee may be placed on garden leave during their notice period, provided there is a contractual right to do so. They should receive pay and contractual benefits during that period, together with any accrued but untaken annual leave.

An appeal provides an additional safeguard. It gives the employer an opportunity to correct procedural errors and demonstrates that the process was not predetermined.

5. Exceptional cases and procedural fairness

Tribunals rarely excuse a failure to follow a fair process. In Gallagher v Abellio, the Employment Appeal Tribunal accepted that dismissal without a full procedure fell within the range of reasonable responses in highly specific circumstances where the employment relationship had irretrievably broken down and further process would have served no practical purpose.

That decision does not remove the general obligation to act fairly. In most cases, failure to follow a reasonable procedure will result in a finding of unfair dismissal, although compensation may be reduced in limited circumstances where the outcome would have been the same.

Section D: How Do Tribunals Assess SOSR Cases?

When an SOSR dismissal is challenged, the employment tribunal applies a structured legal test. Describing a dismissal as SOSR does not determine the outcome. The tribunal will examine the true reason for dismissal and the fairness of the decision in context.

The analysis has two stages. First, the employer must show that SOSR was the real, or principal, reason for dismissal. Second, the tribunal considers whether the employer acted reasonably in treating that reason as sufficient to justify dismissal.

1. Was SOSR the genuine reason for dismissal?

The employer carries the burden of proof in establishing the reason for dismissal.

The tribunal will look at contemporaneous documents, meeting notes, correspondence and internal communications. If the evidence suggests that the dismissal was in fact related to conduct, performance or redundancy but was labelled as SOSR, the employer’s case may weaken significantly.

Clarity at the time of dismissal is important. Decision letters should reflect the genuine business rationale and avoid vague or formulaic language. Where multiple factors are present, the tribunal will identify the principal reason.

2. Was the decision within the range of reasonable responses?

Even where a substantial reason is established, the tribunal must decide whether dismissal was reasonable.

The range of reasonable responses test recognises that different employers may reach different conclusions in the same circumstances. The tribunal does not substitute its own view. Instead, it asks whether a reasonable employer could have dismissed in those circumstances.

Relevant factors include the seriousness and impact of the underlying issue on the business, the steps taken to investigate and consult, the availability of alternatives to dismissal and the size and administrative resources of the employer.

An employer who acts precipitously, fails to document its reasoning or overlooks viable alternatives risks falling outside that range.

3. The importance of proportionality

Tribunals assess whether dismissal was a proportionate response to the issue faced.

In third-party pressure cases, the tribunal will examine whether redeployment was realistically available. In breakdown of trust cases, it will consider whether mediation or restructuring could have resolved the problem. In contractual change cases, it will review the business rationale and the extent of consultation.

A substantial reason does not automatically justify dismissal if a less drastic step would have addressed the problem.

4. Automatic unfair dismissal and discrimination risks

SOSR cannot be used to avoid statutory protections.

If the real reason for dismissal relates to pregnancy, maternity or paternity leave, trade union membership, whistleblowing, health and safety concerns, flexible working requests or other protected rights, the dismissal may be automatically unfair. No qualifying period of service is required for most automatically unfair dismissal claims.

Employers should also assess discrimination risk under the Equality Act 2010. A decision that appears neutral may give rise to indirect discrimination if it disproportionately affects individuals with a protected characteristic and cannot be objectively justified. Compensation in discrimination cases is uncapped.

Tribunals will look beyond labels. The underlying facts and the employer’s decision-making process will determine the outcome.

Section E: What Are the Risks of Getting SOSR Wrong?

SOSR dismissal often arises in situations that feel commercially urgent or operationally difficult. Legal risk arises where business pressure is treated as justification in itself.

If an employer misclassifies the reason for dismissal or fails to follow a fair process, the exposure can extend beyond an ordinary unfair dismissal finding.

1. Unfair dismissal claims

An employee with two years’ qualifying service may bring a claim for unfair dismissal if they believe SOSR was not genuine or the procedure was flawed.

If successful, compensation can include a basic award calculated in a similar way to statutory redundancy pay and a compensatory award for financial loss, subject to the statutory cap.

Tribunals will examine both the reason relied upon and the procedure followed. A substantial reason will not protect an employer who has acted outside the range of reasonable responses.

2. Automatic unfair dismissal exposure

Where the true reason for dismissal relates to a protected statutory right, SOSR provides no defence.

Dismissals connected to pregnancy, maternity or paternity leave, trade union activity, whistleblowing, health and safety concerns, flexible working requests or other protected activities may be automatically unfair. Most automatically unfair dismissal claims do not require two years’ qualifying service.

In such cases, compensation is not subject to the usual statutory cap. Mischaracterising the reason as SOSR can increase litigation risk if internal documents suggest an alternative, protected motive.

3. Discrimination and victimisation claims

SOSR dismissals sometimes overlap with discrimination risk, particularly in breakdown of relationship or reputational risk cases.

If the dismissal is linked, even indirectly, to a protected characteristic such as age, disability, race or sex, the employer may face claims under the Equality Act 2010. Compensation in discrimination cases is uncapped and may include an award for injury to feelings.

Employers should analyse whether the stated SOSR reason could disproportionately affect certain groups and, if so, whether it can be objectively justified.

4. Constructive dismissal and procedural challenges

Where an SOSR situation is handled poorly, the employee may resign and claim constructive dismissal.

Failure to consult, failure to consider alternatives or abrupt termination without explanation may amount to a breach of the implied term of mutual trust and confidence. The tribunal will assess whether the employer’s conduct destroyed or seriously damaged the employment relationship.

Even where dismissal is ultimately found to be fair, procedural shortcomings can result in findings of unfair dismissal with compensation adjusted only in limited circumstances.

5. Strategic considerations and settlement

In higher-risk SOSR cases, employers often consider whether a negotiated exit under a settlement agreement is appropriate.

A structured discussion can provide certainty and reduce exposure to tribunal proceedings. Any such agreement must comply with statutory requirements to be legally binding.

Early legal analysis of the strength of the SOSR reason and the procedural position informs whether dismissal, redeployment or negotiated exit presents the lower risk course of action.

Section F: Summary

SOSR dismissal is one of the five potentially fair reasons for dismissal under section 98 of the Employment Rights Act 1996. It applies where conduct, capability, redundancy or statutory restriction do not properly explain the termination, but there is still a genuine and substantial business reason.

The reason relied upon must be real and of substance. Tribunals examine contemporaneous evidence to determine whether SOSR was the principal reason for dismissal and whether it was properly classified.

Even where a substantial reason exists, dismissal will only be fair if the employer acted reasonably in all the circumstances. Investigation, consultation and consideration of alternatives are central to that assessment.

Third-party pressure, breakdown of trust, reputational risk, contractual change and fixed-term expiry can fall within SOSR, but each requires careful analysis. Misclassification, weak process or failure to recognise redundancy or protected rights can lead to unfair dismissal, automatic unfair dismissal or discrimination claims.

Employers who approach SOSR dismissals with structured reasoning and documented procedure are better placed to demonstrate that their decision fell within the range of reasonable responses.

Section G: Need Assistance?

SOSR dismissals often arise in sensitive or high-risk circumstances where misclassification or procedural missteps can result in tribunal claims.

DavidsonMorris’ employment law advisers support employers with strategic assessment of dismissal grounds, procedural compliance and risk mitigation. For advice on SOSR dismissals or broader workforce management issues, contact us.

Section H: FAQs

What is SOSR dismissal in UK law?

SOSR, or some other substantial reason, is one of the five potentially fair reasons for dismissal under section 98(1)(b) of the Employment Rights Act 1996. It applies where the reason for dismissal does not fall within conduct, capability, redundancy or statutory restriction but is still genuine and substantial.

Does SOSR require two years’ service?

An employee generally needs two years’ qualifying service to bring an ordinary unfair dismissal claim. However, most automatically unfair dismissal claims do not require any minimum period of service, and discrimination claims under the Equality Act 2010 are not subject to a qualifying period.

Can a personality clash justify SOSR dismissal?

A minor personality clash will not usually justify dismissal. A serious and evidenced breakdown in working relationships may amount to SOSR if continued employment is no longer viable and reasonable steps to resolve the issue have been explored.

Is client pressure enough to dismiss under SOSR?

Client or third-party pressure may amount to SOSR, but the employer is expected to investigate the concerns, assess their reasonableness and consider alternatives such as redeployment. The absence of alternative work does not automatically make dismissal fair.

Is expiry of a fixed-term contract redundancy or SOSR?

Expiry of a fixed-term contract is a dismissal in law. If the reason for non-renewal is a reduced need for employees to carry out work of a particular kind, redundancy may apply. If the role was linked to a specific project or temporary arrangement that has ended, SOSR may be the appropriate classification.

Is an SOSR dismissal automatically fair?

Identifying a substantial reason is only the first step. The employer must also act reasonably and follow a fair procedure. Tribunals assess whether dismissal fell within the range of reasonable responses open to a reasonable employer.

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