Wrongful dismissal: Know your rights

Employment law can seem an impenetrable maze – one that you’ll hopefully never have to navigate. But having a basic understanding of your workplace rights is still essential.

So to help you get your head (and ours) around the technicalities of wrongful dismissal, we’ve spoken to specialist Employment Lawyer Philip Landau of Landau Law to bring you this handy guide.

What’s the difference between wrongful dismissal and unfair dismissal?

You may have heard of both wrongful dismissal and unfair dismissal, but they are not interchangeable. Wrongful dismissal is a breach of contract by the employer. “It occurs when an employee is dismissed from their employment without notice, or the correct amount of notice in accordance with their contract,” explains Philip.

“It also occurs when employment is terminated in breach of the terms of the contract. And unlike unfair dismissal, there is no qualifying period of service needed to bring a wrongful dismissal claim.”

To bring a claim for unfair dismissal then, you must have worked for your employer for a minimum of two years, minus one week. And this type of claim is not about a breach of contract but about your employer having sufficient reason to dismiss you.

“You’ll have an unfair dismissal claim if you’ve been dismissed and your employer doesn’t have one of the potentially fair reasons justifying such dismissal,” explains Philip.

Wrongful dismissal: Know your rights

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Unfair dismissal in a nutshell

There are a number of reasons an employer can use to dismiss an employee. Philip outlines some common ones as:

  • The employee lacking capability or qualification
  • Gross misconduct by the employee, such as dishonesty and poor attendance
  • A genuine need for redundancy
  • Where employment contravenes a statute – if, for example, you needed to drive in your employment, but were banned due to speeding.

How do I choose between wrongful dismissal and unfair dismissal?

There are situations when an employee can choose between a wrongful dismissal claim and an unfair dismissal claim. Imagine, for example, that you’ve been unfairly dismissed on the grounds of a theft you didn’t commit, and your employer terminates your contract without your working the remainder of your notice period. This would be both a breach of contract (wrongful dismissal) and an unfair dismissal (because you didn’t commit the theft).

So which one do you claim for? To some extent it depends on your notice period, as Philip explains:

Senior managers who have lengthy notice periods may find it preferable to bring a claim for wrongful dismissal, as opposed to unfair dismissal. This is because they stand to gain more from damages for breach of contract, as opposed to the amount they could have received on an unfair dismissal claim.”

Philip also points out that you can’t bring both claims to a tribunal separately, so any damages that are awarded under wrongful dismissal will be deducted from the compensation you’re awarded for an unfair dismissal, and vice versa.

Wrongful dismissal: Know your rights

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What does “dismissal with pay in lieu of notice” mean?

One outcome for a dismissal, which happens very often, is when an employer dismisses an employee and agrees to pay his or her notice period. In this situation, the payment is usually regarded as damages for wrongful dismissal, and the employer would not therefore usually be liable for additional damages.

How much can I claim for a wrongful dismissal?

There is no fixed amount of damages for a wrongful dismissal claim. It all depends on your pay and any other benefits you might have received had your employer not breached the contract. So the use of a company car, for example, or any bonus payments you might have missed out on, although Philip says that claims like bonuses can be difficult to prove, especially if they’re discretionary in nature.

It’s also important to remember that, were you to find a new job and start working within the notice period that you didn’t complete (because your employer breached the contract), you are not entitled to a double recovery. Instead, your new salary will be taken into account when calculating your loss.

What’s more, as the employee, you’re expected to take all the steps possible to mitigate your loss of earnings. In other words, you must look for another job.

How long does a wrongful dismissal case last for?

According to Philip it depends on where you live, and how busy the employment tribunal is, but a hearing date might be between four and six months after you lodge your claim.

How much might it cost me if I lose?

“This depends on what has been agreed with your legal representative, if you opt to have one, as you may have to pay their legal fees or you may have opted for a ‘no-win, no-fee’ basis of funding,” explains Philip.

Either way, you won’t be able to recover the tribunal fees that you will have paid to lodge your claim. But one big difference between employment tribunals and courts is that you won’t automatically have to pay your employer’s legal costs – which you are more likely to do in a court.

That said, your employer’s legal representative (lawyer) can still make an application for you to pay their costs, though Philip admits that these applications are rarely granted.

“Such cost orders are generally only granted in situations when you have brought a hopeless case that had no chance of success, or you behaved very badly in the way the case was run, or you turned down a good offer of settlement.”

Wrongful dismissal: Know your rights

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What are the chances of my losing my case and could it damage my name?

This depends entirely on the circumstances. However, as long as it can be proved that your employer was in clear breach of contract, you should be able to win. As for the claim damaging your reputation or labelling you a “troublemaker”, in Philip’s experience this is unlikely.

“After all, this wrongful dismissal is essentially a breach of contract claim, which any future employer is likely to understand. Also, while the tribunal process is open, very few cases warrant publicity, so it’s unlikely that a future employer would be aware that you’ve brought proceedings against your previous employer.

“However, in practical terms, your employer may decide not to give you a job reference if you make a claim against them. There is no obligation on your previous employer to provide a reference, although if they do and it is not factually correct or is misleading, you may have a separate claim for this.”

When should an employee make a claim?

You must make your claim for wrongful dismissal to an employment tribunal within three months minus one day from the date you were dismissed.

Also, before lodging a claim you are obliged to alert Acas (the government quango that provides advice and services for employment disputes) under the Acas mandatory pre-claim conciliation scheme. You can find out more about this on its website.

By doing this, you will have stopped the clock on your employment tribunal time limit, until the day you receive a certificate from Acas confirming that the claim has been completed.

Where can I go for free advice?

Acas offers free and impartial advice, while some solicitors, like Landau Law, will also offer a free initial consultation.

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