If you are considering dismissing an employee, you will need to know the basis upon which you can lawfully dismiss someone, as well as what procedures to follow to ensure that you do so fairly, including the contents of the dismissal letter to notify the employee of your reasons.
Before considering what a dismissal letter should contain, we first set out the basis upon which an employer can lawfully dismiss an employee, from what constitutes a fair reason to how to follow a fair procedure.
What are the fair reasons for dismissal?
By law, an employee has a right not to be unfairly dismissed by their employer. As such, in order to fairly dismiss an employee you must have a genuine and valid reason to do so, otherwise run the risk of facing an unfair dismissal claim before an employment tribunal.
By virtue of section 98 of the Employment Rights Act (ERA) 1996, a valid reason for a fair dismissal can include any of the following:
- The employee’s capability or conduct, for example, where the employee is underperforming or where there are serious misconduct issues
- Something that prevents the employee from legally doing their job, for example, a HGV driver losing their driving licence
- The employee’s job is no longer needed, in other words, redundancy
- There is some other substantial reason of a kind such as to justify the dismissal of the employee holding the position that the employee held.
The right of an employer under s.98 ERA to fairly dismiss an employee for ‘some other substantial reason’ (SOSR) is a statutory catch-all provision allowing an employer to decide on dismissal where no other potentially fair reasons apply.
In theory, the SOSR provision can cover a wide variety of situations and, as such, can be a useful tool for employers in justifying dismissal in somewhat unusual scenarios, although whether or not the reason for dismissal falls within its scope will depend upon the facts of each case.
Common examples of where ‘some other substantial reason’ could be used to justify a dismissal include the following:
- The non-renewal of a fixed-term contract of an employee recruited as maternity leave cover
- The dismissal and re-engagement of an employee to impose new contractual terms and conditions that the employee has refused to agree
- A dismissal arising from a personality clash between employees that makes it impossible for them to work together
- A dismissal arising from a reputational risk to an employer’s business, for example, where an employee has been convicted of a criminal offence
- A dismissal arising from a conflict of interest with an employer’s legitimate business interests, for example, where an employee has a close relationship with a competitor.
In most cases an employee can only claim unfair dismissal if they have worked for you for a qualifying period of no less than two years, unless they are claiming for an automatically unfair reason for which no length of service is required.
An automatically unfair reason could include, for example, where an employee has been dismissed for a reason relating to their pregnancy or maternity, or for taking time off to care for dependants, although this list is not exhaustive.
How to dismiss someone fairly
Even in circumstances where you can demonstrate that you have a genuine and valid reason for dismissal, you must still be able to show that you followed a fair procedure, and the decision to dismiss was reasonable in all the circumstances.
There is no statutory definition of ‘reasonableness’, although in any dismissal scenario, certain basic requirements must be met. In particular, to be deemed to have acted reasonably, an employer must have:
- Undertaken a proper and thorough investigation, where appropriate
- Followed any relevant procedures for the dismissal in question, for example, any disciplinary procedures for a conduct or performance issue
- Informed any affected employees why they were being considered for dismissal and/or undertaken some form of consultation
- Provided affected employees with sufficient time to consider any proposals and to make representations before any decision is made
- Responded to any representations made, or objections raised, by or on behalf of any affected employees
- Considered all reasonable alternatives to dismissal, such as demotion, redeployment or otherwise
- Allowed the employee to be accompanied by a colleague, or a trade union representative or official, at any disciplinary or dismissal hearing(s)
- Provided the employee with the opportunity to appeal
What constitutes a fair dismissal procedure will depend upon the circumstances of the case. It may not be practicable for all employers, having regard to the size of their business or the resources available, to take the same steps in investigating and dealing with dismissal although, as an absolute minimum, the procedural steps set out above should be complied with, where at all possible.
How to write an employee dismissal letter
In the event that you have made a decision to dismiss, having followed any relevant procedures and otherwise acted reasonably in all the circumstances, you will need to provide the employee with a dismissal letter. In particular, the employee must be notified in writing of the reasons for their dismissal, their period of notice, if any, and the effective date of termination of their contract.
Although the contents of a dismissal letter will very much depend upon the nature of the dismissal, the reason(s) behind the decision to dismiss and the manner in which the dismissal is to take place, for example, with immediate effect or on notice, the letter should always include the following:
The reason for your decision to dismiss Clearly set out the reason(s) for the dismissal, with reference to any factual circumstances. However, you must be careful not to disguise the real reason for dismissal in an attempt to bolster any defence to an unfair dismissal claim as this, in itself, may give rise to allegations of unfairness.
The factors that formed the basis of your decision Explain what factors were taken into account in making any decision to dismiss, including any factors that were disregarded. This could include, for example, any live written disciplinary warnings or any mitigating circumstances. In particular, you should explain why dismissal was considered the most appropriate course of action, over and above any alternatives to dismissal.
The process that you followed in reaching your decision Explain the process that was followed in reaching your decision to dismiss including, for example, any investigation and disciplinary hearing or, in the context of redundancy or other forms of group dismissals, any consultation process that has taken place.
The extent of any notice period Make it clear whether or not the employer is required to work their notice period, or if s/he will be paid in lieu of notice. In the case of summary dismissal, termination of the employment contract will take place with immediate effect, typically from the date of the disciplinary hearing or dismissal letter.
The effective date of termination of the employment contract Set out the date upon which the employment contract will come to an end, not least to help to clarify the date upon which any final salary and holiday pay will be calculated. You should also include any other practicalities, such as when the employee can expect to receive their P45 and the arrangements for the return of any company property.
The employee’s right to appeal Notify the employee of their right to appeal any decision to dismiss, including the appeals procedure and who to notify of any request for an appeal, allowing for a reasonable timeframe within which to do this.
Getting it wrong
In the event that your dismissal letter does not include the right information, it may well harm your ability to defend any claim for unfair dismissal in due course. In particular you should bear in mind that the contents of this letter will be scrutinised by an employment tribunal if a claim is made following termination of the employment contract.
Moreover, by completely failing to document the reasons for your dismissal, this, in itself, is likely to suggest that a fair process has not been followed. It will also potentially expose you to an adverse inference that any reason advanced before the tribunal in defence of any claim for unfair dismissal is not in fact the real reason for the dismissal.
The dismissal letter is your opportunity not only to notify the employee of why and when their contract will come to an end, but also to demonstrate a fair reason for deciding to dismiss, as well as the fair process you have followed in reaching that decision. In this way, you can avoid any avoid misinterpretations or disputes arising at a later date.
Any delay on providing the employee with the dismissal letter could also have a negative impact on the fairness of the whole process. As such, once the decision to dismiss has been made, it is important to send the letter as soon as possible.
Does an employee have a right to be given a dismissal letter?
By virtue of section 92 of the ERA 1996, any employee who has been continuously employed by you for two years or more on the effective date of termination will be entitled to a written statement giving particulars of the reasons for their dismissal, regardless of whether the employment contract is terminated with or without notice.
The statutory right to a dismissal letter will be triggered upon the employee’s reasonable request for one, in response to which you should provide the letter within 14 days of that request.
In circumstances where an employee is legally entitled to a dismissal letter, but you fail to provide one or, alternatively, the reasons given are inadequate or arguably untrue, by reason of section 93 of the ERA 1996 the employee may bring a complaint before the employment tribunal.
It is open to the tribunal to make a declaration as to what it finds your reasons were for dismissing the employee, and that you pay to the employee a sum equal to the amount of two weeks’ pay.
Sample employee dismissal letter template
By using a pre-constructed template that highlights what information is needed within a dismissal letter, you can feel more confident that all the necessary content has been included, albeit this will still need to be tailored to the facts of your case.
Below is a sample template letter for summary dismissal for gross misconduct:
[Insert date of the letter]
Dear [name of employee],
I am writing to confirm the decision taken during your disciplinary hearing on the [insert date of hearing] to summarily dismiss you for gross misconduct. Further, I can confirm that the decision to dismiss was made with immediate effect, from that date, without notice or pay in lieu of notice.
As such, in accordance with that decision, your last date of employment with [insert name of the organisation] was [insert date of termination].
That said, you remain bound by any post-termination confidentiality obligations and restrictive covenants, until these expire under the terms of your contract of employment.
The decision to dismiss was made following a full investigation and disciplinary hearing in which you were given an opportunity to respond to the allegations of gross misconduct, namely that on [insert date and time] you were witnessed physically assaulting a work colleague on company premises.
As such having reviewed the witness evidence and, further, having reviewed the CCTV footage, that allegation has been proven against you, resulting in the decision to summarily dismiss you.
In accordance with the company’s written disciplinary procedure, you are entitled to appeal this decision. If you wish to appeal this decision you must do so by setting out your reasons in writing and sending these to [insert name of appeal contact] at [insert address details] by [insert date].
As an employer facing the possibility of an unfair dismissal claim, it is important to note that in the event of any uncertainty when drafting a dismissal letter, expert legal advice should always be sought from an employment law specialist.
Moreover, wherever possible, expert advice should be sought prior to making any decision to dismiss to ensure that, at all times, you follow a fair and lawful procedure, as well as to explore all potential alternative options to dismissal.
As employment law specialists, we can assist if you have any queries relating to employee dismissals and disciplinaries, such as drafting dismissal letters. Speak to our experts today for specialist employer advice.
Writing a dismissal letter FAQs
What are the different types of dismissal?
Lawful dismissals are by reason of the following: Conduct/Misconduct; Capability/Performance; Redundancy; Statutory Illegality; Some Other Substantial Reason.
How do I write a dismissal letter?
Put simply, the dismissal letter should set out in clear and specific terms the reasons for the dismissal and the date the employment contract will be terminated.
What makes a dismissal unfair?
Dismissal could be deemed unlawful if the employer did not have fair reason to dismiss or if they failed to follow a fair and lawful process in dismissing the employee.
Last updated: 1 February 2020