What is wrongful dismissal?

You do not need 2 years service for a wrongful dismissal claim (unlike unfair dismissal).

Wrongful dismissal is where an employer dismisses an employee in breach of their contract, usually without giving notice where the employee is entitled to notice of termination (or pay in lieu of notice). It’s not a statutory claim – it’s basically a breach of contract claim but with an employment contract rather than a commercial contract – and you don’t need two years’ service to claim wrongful dismissal like you do with unfair dismissal.

What is the difference between wrongful dismissal and unfair dismissal?

These two types of claims are very different, though they are often confused or the terms used interchangeably. Even Google promotes snippets for one that are actually about the other!

You need two years’ continuous employment to claim unfair dismissal (unless you have a special type of unfair dismissal claim that doesn’t need two years’ service). You can claim wrongful dismissal from day one.

The potential awards are different – in a wrongful dismissal claim you’re only likely to recover unpaid notice, whereas if you’ve been unfairly dismissed, you’ll be entitled to a basic award and a compensatory award. More on these below.

To avoid a successful claim for unfair dismissal, the employer has to show that they had one of the potentially fair reasons to dismiss and that they followed a fair procedure, before deciding to go ahead and dismiss. To avoid a successful wrongful dismissal claim, the employer just has to show that they were entitled to dismiss without notice or payment in lieu.

What is the payout for wrongful dismissal?

If you win a wrongful dismissal claim, you’re likely to be awarded your notice pay or what you should have been paid if your employer had complied with the contract and terminated with notice.

In complicated cases, where employees have contractual rights to company cars, private medical insurance, bonuses and so on, that could lead to significant awards for the loss of such benefits for the notice period. For instance, if the employer dismisses without notice shortly before a bonus is due to be paid, in order to avoid paying it.

Remember, what is awarded will depend on the terms of the contract, and what the employee should have got if the employer had complied with its terms.

It’s also important to be aware that the Employment Tribunals can only award up to £25,000 for a wrongful dismissal (or breach of contract) claim. If your claim is worth more than this, and unless you have another reason to stick with the Employment Tribunal system, you’d have to bring a breach of contract claim in the Courts, where the fees and costs regime is markedly different to the Employment Tribunals.

By contrast, if you win an unfair dismissal claim, the award will be made up of a basic award, that’s calculated in the same way as statutory redundancy pay, plus a compensatory award.  The compensation for unfair dismissal is capped at a year’s salary or a set maximum that changes every year – see here for the figures as of the date this blog was published.

There is a ceiling award at and employment Tribunal of £25,000 for wrongful dismissal.

Can you be sacked without warning?

Yes. Employers can dismiss employees whenever they want – the question is whether a dismissal is lawful, fair and/or discriminatory or not.

You can be sacked without warning, or without being given verbal and/or written warnings if you’ve committed gross misconduct.

In the unfair dismissal context, the employer will dismiss fairly for gross misconduct if they’ve carried out an investigation and can show that it was reasonable to conclude that the employee did commit gross misconduct, and if dismissal is within the “range of reasonable responses” available to the employer.

It’s a bit different in wrongful dismissal.  An employer will dismiss wrongfully if they dismiss an employee without notice – or without giving or paying in lieu of the full amount of notice due – where the employee hasn’t committed a serious breach of their employment contract.  Gross misconduct is regarded as a serious breach of contract. It follows that dismissing without notice for gross misconduct won’t be a wrongful dismissal, provided that the employer can show that the employee had committed a serious enough breach.

A wrongful dismissal could also take place where the employer doesn’t follow a contractual disciplinary or dismissal procedure – this is partly why we’d usually say disciplinary procedures shouldn’t be contractual.

You might be interested in our guide on insubordination

How do you claim wrongful dismissal?

In the Employment Tribunals, employees must claim wrongful dismissal within 3 months of the termination of employment. Before bringing a claim, you have to go through Acas Early Conciliation – which must be started within 3 months of dismissal, and there are rules about how the Acas Early Conciliation period affects the deadline by which you have to submit an Employment Tribunal claim. We won’t go into that here – it can be quite complicated.

If, however, your claim is worth over £25,000 and there’s no good reason to stick with the Employment Tribunals even if it’s worth more than that, you’ve got 6 years to bring a Court claim.  However, you have to go through pre-action protocols before filing your claim.

What can I do if I think I’ve been wrongfully (or unfairly) dismissed?

Contact us!  We’ll help you navigate your way through what’s happened and look to get you a solution that you can live with and that enables you to move forward. Get in touch with our employment law team at employment@Qlaw.co.uk or on 03300 020 863.

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