What Are the 5 Fair Reasons for Dismissal?

Employees are assets to any company, but as a business owner, you are likely to be faced with a reason to consider dismissing one or more of your team. As you would expect, legal protection is in place for employees for good reason, however, it is not true to state “it is impossible to dismiss somebody” or “the law is stacked against the employer”. The statutory requirements simply dictate that a company follows a process that ensures that the dismissal is based on reasonable grounds and the individual is provided with an opportunity to present their case for the defence. Therefore, to avoid employment tribunals, unnecessary legal fees and damage to reputation Companies are best advised to seek guidance from HR professionals and to follow the appropriate process.

5 fair reasons for dismissal are as follows:


Dismissal based on an employee’s inability to perform competently can be for two reasons: poor performance and ill health. An employee is incapable of performing in their job when struggling with long-term or persistent sickness. In this case, you need to find ways to support them, give time for recovery, and consider other options before dismissal.

In the case of poor performance where an employee doesn’t meet satisfactory standards within their job, HR support should take them through the disciplinary process before dismissal. Companies are advised to have clear policies in place for handling capability issues.

Conduct or Behaviour

People do make errors of judgement and people misbehave. Both of these can provide good reason to dismiss an employee. If an individual’s behaviour is divisive and disruptive then after following a process of formal warnings the individual may be dismissed. An individual may also commit an act of misconduct i.e. operated outside of policy or made a work error due to being negligent etc.. and again, following a process of issuing warnings, if the misconduct continued then you could reasonably be dismissed. Then there are acts of Gross Misconduct. These are acts that are so serious that you can dismiss without having provided previous warnings. Examples of Gross Misconduct offences are theft, racial abuse, physical aggression etc. Please be aware however that you still need to follow a process ensuring that the individual accused of the act has had an opportunity to provide any mitigating circumstances. There is no such thing as instant dismissal!!


Redundancy dismissals occur when an organisation no longer has the need for a specific role. This may happen due to Company closure, department closure, company reorganisation / restructure or location change. If you happen to be the job holder of that role then you are placed at serious risk of redundancy and are taken through a consultation process. Redundancy is a specialist area and should consult with a HR professional before commencing any discussions. There are many different legislative requirements to consider based on the individual circumstances.

Breach of a statutory restriction

This, although rare, applies when keeping an employee means breaking the law. For instance, when their working permit expires and they continue to work in your company. However, you’re still required to follow the due disciplinary and formal dismissal procedure.

Some other substantial reason

Every dismissal that doesn’t fit the other categories falls here. Some examples include:

  • Organisational restructure that isn’t redundancy.
  • Conflict of interest
  • Personality clashes
  • Temporary employee dismissal after their contract expires.
  • Breakdown in trust and confidence.

Dismissal based on some other substantial reason requires you to have a solid case as a tribunal case would result in thorough testing of your reasoning and approach.

Types of Dismissal

These include:

  • Fair dismissal: When an employer’s reasons for dismissal are sound and admissible, redundancy being among them. Other reasons also include employee qualifications, capability, or conduct.
  • Unfair dismissal: This involves situations where there aren’t sufficient grounds for dismissal, or the HR services fail to follow company policies regarding the termination.
  • Constructive dismissal: Involves scenarios where an employee leaves their job because they feel pushed out due to the treatment they receive from the employer. Despite the word ‘constructive’ this is not good and will most likely result in an employment tribunal claim.
  • Wrongful dismissal: Although it could easily be mistaken for unfair dismissal, it involves a breach of an employee’s contract by the HR support during dismissal.


Employee dismissals are sensitive and need to be handled carefully by HR support. Ensure you have reasonable grounds like redundancy, capability, misconduct, breach of statutory restriction, or other substantial reasons to terminate employee contracts. Seek our help for HR services to exercise fairness in employee dismissal by following the Acas Code of Practice that defines your responsibilities.


If you need HR support from a company that understands the needs of your business, contact us today. At Harwood HR we can support your business, help you to grow and promote your employees’ talents. Our UK-based team offers a range of HR support services and advice for SME businesses, including outsourced HR support.


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Reasons for Dismissal

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