LRD Booklets November 2007

Unfair dismissal - a legal guide


There are no published figures for the number of employees who are dismissed by their employers every year. However, it is known that on average around 45,000 workers a year submit unfair dismissal claims to an employment tribunal as a result of the injustice that they felt about their dismissal.

Taking a claim to a tribunal is a time-consuming and difficult process and is not something that dismissed employees do lightly. It is certain that for every case registered there are dozens more in which the dismissed employee was reluctant to pursue a claim. Often employees will not challenge their employer’s actions for fear of acquiring a reputation as a “troublemaker”, which might make getting another job difficult.

Of course, the best way to challenge employers’ actions is to make sure that the workplace is well organised and that procedures are in place to ensure that dismissal is the very last resort. And it is equally important to ensure that if an employee is dismissed, the dismissal is carried out in accordance with an agreed procedure.

A well-organised workforce is one that knows its rights. This means that union and employee representatives need to have a good grasp of the current law on dismissal and their members’ rights to job protection. This booklet will help representatives to understand how the law operates and what the different types of dismissal are. Chapter 3 explains what makes a dismissal unfair, and sets out how employers must deal with these. Constructive and wrongful dismissals are covered in Chapters 5 and 6.

Dismissal claims — facts and figures

In 2006-2007 there were nearly 45,000 claims for unfair dismissal registered at tribunals. This is broadly consistent with previous years; although there is some variation year to year, the number of unfair dismissal claims has averaged at 45,000 over the past seven years.

Most of the claims that were registered with the tribunals were never actually heard because they were withdrawn or settled before the tribunal hearing. Only 20% of claims went all the way to a tribunal; half of these were successful (3,870 claims were upheld; 3,567 were dismissed).

Table 1: Number of unfair dismissal claims going to tribunals

Year Number of claims
2006-07 44,491
2005-06 41,832
2004-05 39,727
2003-04 44,942
2002-03 45,373
2001-02 51,512
2000-01 49,401

The maximum compensation that can be awarded in most unfair dismissal claims is £69,900 (£9,300 for the basic award and £60,600 for the compensatory award). Last year the average amount of compensation awarded for unfair dismissal claims was £7,974, although fifty per cent of successful claimants received less than 5,000 and the median award was £3,800.

The chances of a successful applicant being reinstated or re-engaged are very low. In 2006-07 only 23 of the 3,870 successful applicants won the right to go back to their jobs. And those who do win do not often achieve much in compensation. Seven per cent of successful applicants did not get any compensatory award from the tribunal.

For employees who have been dismissed this means that it is much more likely that the matter will be satisfactorily resolved either in direct negotiations with the employer or by using the services of an arbitrator or conciliator. But this does not mean that the legislation is irrelevant. Representatives should use the law to assist them in reaching an acceptable conclusion outside of the tribunal system.

This booklet refers to legislation and legal cases. For details of where to get these, see "Further help and information" at the end of this booklet.