No matter what size or type of business you run, if you employ staff then there will probably come a time in which you have to let one or more of them go.
Dismissing employees is a difficult and sensitive process, and should always be approached with caution.
This article in itself is not a complete guide to dismissal and redundancy, but is designed to give you a brief overview of all the key areas. With all matters of such sensitivity, we suggest you carry out further research before making decisions, and in difficult cases; contact an employment consultant or solicitor.
There are two main areas involved in letting staff go: Sacking/Dismissal and Redundancy.
Sacking/Dismissal
There are a number of acceptable reasons for dismissing an employee. Gross misconduct or repeated minor misconducts, or an employee failing to effectively carry out their job over a period of time are legitimate reasons for dismissal.
Minor Misconduct
A minor misconduct is where an employee breaks rules or performs poorly, but where the consequences for the business are small or limited. For example:
Being late
Using a company vehicle for unauthorised personal uses
Using company phones for personal calls
Using company internet facilities for personal browsing/email use
Not performing to adequate/satisfactory standards
A minor misconduct is not normally adequate grounds for dismissal, but if the behaviour is repeated, even after warnings, then it becomes a gross misconduct issue.
Gross Misconduct
Gross misconduct is where an employee breaks the rules, and the consequences for the business are damaging. For example:
Abusive Behaviour or violence
Theft or fraud
Alcohol or drug abuse
Discrimination or harassment
Deliberately damaging company equipment/property
Seriously breaking health and safety regulations
Serious Negligence
Serious insubordination
Misuse of an organisations property or name
Serious breach of confidence
Minor negligence caused by a lack of knowledge or experience should be addressed with training or guidance in the correct area. By law, the employee must be given reasonable opportunity to be taught the skills/knowledge needed to carry out the job.
Losing a customer because a form was not filled in correctly by a new employee who was given no relevant training is not misconduct of any level.
The loss of a relevant licence is also (in most cases) grounds for dismissing a worker, for example:
If an employee drives a lorry every day, but loses their driving licence, they are no longer able to carry out their job. The employer therefore usually has reasonable grounds to sack the employee.
There can be grounds for the employee to expect the employer to reassign the employee to another function while any ban is being served. A short speeding ban may only last for two weeks, and it would therefore be reasonable for the employer to find other work for the duration of the ban.
A loss of a licence should not be used to remove employees for any reason other than their job ability during the ban. Be careful of dismissing an employee that could fulfil other functions while banned, it could lead to an unfair dismissal claim.
In cases of alcohol and substance misuse, it has been found that employers who refer employees for rehabilitation or specialist treatment are likely to help their employee manage their problem and return to work. This can actually work out cheaper than hiring and training a new employee in some cases, as well as helping a valuable member of staff recover from a serious problem.
Redundancy
Downsizing, laying-off, letting go, re-evaluation, these are all nicer terms created to try and ease the pressure of making redundancies.
There are many reasons why you may need to make someone redundant, a need to save money, overcapacity, branch/office/factory closure, or a lack of need for the job. In each case, there is a requirement to lose a particular number of staff.
Redundancy means that the job no longer exists. If a direct replacement is hired for the employee then it is not a reasonable case of redundancy. However, if an employee is made redundant as part of a need to reduce the workforce, and an existing employee moves into that job, that is still redundancy; as long as no vacancy or opening exists for the redundant job.
The realisation of redundancies in the workplace can often cause a lot of damage to employee morale, so offering voluntary redundancies first can help soften the blow. People who may be considering changing job or retiring can volunteer to be made redundant, thus minimising the need to make other employees redundant. Voluntary redundancies are still subject to the same payments and regulations as non-voluntary redundancies.
As redundancy payments vary according to years of service, voluntary redundancies can often cost more as longer service employees (see Redundancy pay section) take the option. Voluntary redundancies also risk your business losing valuable experience and skills, but it does remove a significant amount of the pressure involved.
Legality
Before making any decisions on dismissal, it is of vital importance to make sure that your grounds for dismissal are legal. There are many situations that are covered in the law as being illegal grounds for dismissal. Such as:
Race
Gender
Disability
Pregnancy
Union membership / Non-membership
If an employee is dismissed on any of these grounds, they have a right to claim for unfair dismissal.
For example:
It is not wrong to dismiss a disabled person as long as the grounds for dismissal are unrelated to the disability. To dismiss a disabled person for serious negligence is reasonable, but to dismiss a disabled person for slow productivity (caused by their disability) is not allowed, no matter when the disability became evident / occurred.
The situation is more complex if a disability occurs that makes the employee unable to carry out their existing job at all. In this case, you should look to provide alternative work.
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