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10 tips on how to avoid unfair dismissal claims

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Statistics from the Tribunals Service show a record number of accepted unfair dismissal tribunal cases for the period 1st April 2009 – 31st March 2010 – an increase of over 56% from the previous year.

One of the causes for this increase, according to the Tribunals Service, was the recession.

This trend is a real worry for businesses. The Bank of England recently revised down the GDP growth rate for 2011 and has suggested interest rates might increase which could have a damaging effect on the fragile economy. Should the economy slip back into recession, the statistics suggest a further rise in unfair dismissal claims could ensue – which themselves have become more expensive due to the recent increase in maximum compensation awards to £68,400.

To help you with this I have listed my ‘top tips’ to make sure you don’t end up the subject of an unfair dismissal claim:

  • If you are considering dismissing an employee due to a disciplinary matter, the ACAS Code of Conduct should be followed.
  • The ACAS Code of Conduct sets out a procedure for dismissing employees in disciplinary situations. You should write to the employee to invite them to a formal hearing. When holding a disciplinary meeting, allow the employee to be accompanied. Remember to take appropriate action after the disciplinary meeting and inform the employee of the outcome in writing.
  • Try to resolve problems in your workplace informally. Having a quick chat with the employee may be all that is needed to resolve a problem and should be the first step for most employers.
  • Keep your employees’ contracts up to date, remembering to inform staff about any changes that could affect their working practice.
  • Use a discipline and grievance procedure and, more importantly, ensure that staff are aware of both its existence and contents. A lack of clear procedure can leave your business vulnerable to dispute.
  • Train managers and supervisors to deal with problems that may arise by following the correct procedures. Most problems can be nipped in the bud if caught early enough and dealt with efficiently.
  • Deal with formal disciplinary matters fairly and in a reasonable manner, ensuring written records of the incident are kept. A clear audit trail is the key to defending a claim.
  • Never dismiss your staff on the spot – no matter how serious their alleged misconduct, there is still a procedure to follow and failure to do so could result in a tribunal case being brought.
  • Establish the facts. Conducting an investigation into the incident is critical. Employers must be able to demonstrate why the action taken against the employee was justified. This is particularly relevant in conduct matters.
  • Provide employees with an opportunity to appeal the decision to dismiss. Provide them with the name of the person they should appeal to and give them a reasonable time frame in which to submit their appeal.

Not all of the above will apply to every dismissal as each type of dismissal will require a different procedure to be followed. You should look at each potential dismissal situation on a case by case basis. When faced with an employment issue, it is always recommended that you seek legal advice.

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