When dealing with a problematic employee, whether the issue is under-performance or conduct, the usual advice from HR is that if the employee has two years' service, to avoid an unfair dismissal the business will need to follow a fair process (or agree a settlement). A recent case shows that this is not always the case - but businesses should still beware of procedural short cuts.
The case concerned a senior employee (G) whose relationship with her manager had deteriorated badly over several years. They had disagreed about various issues, including the manager's requirement that G take part in an on-call rota, disagreement about recruitment decisions and G's request for a pay rise, but the key issue was the breakdown of trust and cooperation. It was clear that G blamed her manager for this and she did not suggest any ways in which it could be resolved. G's manager took the decision to dismiss her without using the company's performance management or disciplinary procedures, on the basis that there was no prospect that a formal process would improve their working relationship.
The Employment Tribunal, very unusually, took the view that the failure to follow a formal process did not make the dismissal unfair. This was because:
- the ACAS Code on Discipline and Grievances did not apply;
- the breakdown of the relationship would not fall naturally within any of the company's formal procedures; and
- a formal procedure would have served no useful purpose (as the Claimant and her manager had discussed the issues several times already).
The Tribunal held that any appeal against dismissal would have been 'going through the motions'. As a result, the dismissal was within the band of reasonable responses, despite the lack of process. The Employment Appeal Tribunal upheld the decision.
However, employers shouldn't treat this case as a reason to avoid formal processes. In many cases, a formal process will be essential to ensure that the employee has the opportunity to present their case and suggest ways of improving the working relationship. Even where that appears unlikely, a formal process may give an opportunity to initiate discussions about an agreed exit under a settlement agreement (which in many cases is preferable to having to defend an Employment Tribunal claim). However, in exceptional cases where the ACAS Code does not apply and where the breakdown of the relationship is irretrievable and acknowledged by both parties, this case demonstrates that the employer will not inevitably lose an unfair dismissal claim if they don't use a full formal procedure.
Want to hear more from us? 
