We’re aiming to explore the issues in more detail in an interview, to be added to the site next month.

Sir Alan Sugar’s refrain is now famous but employers must take care if they follow his example.  The average Employment Tribunal unfair dismissal award is £8,000 and the average legal fees, win or lose, another £8,000 so uttering these words could be extremely expensive for your business and I doubt Sir Alan would feel obliged to help out.

All change!

The old law relating to dismissal was scrapped as of 6^th April 2009, now we have the new ACAS Code of Practice.  So businesses can no longer be accused of automatic unfair dismissal for saying these 2 famous words.  However the new Code is several pages long and failing to follow all the steps/principles will be taken into account by the Employment Tribunal, so ignore these steps at your peril.

How to dismiss without getting into trouble.

It always amazes me that more people don’t dismiss failing employees in their first year of employment.  Businesses have up to 51 weeks to decide an employee is just not working out.  As long as there is no discrimination, health & safety or trade union issues, your employee has no unfair dismissal rights until they have 1 year’s service (this deadline includes the statutory 1 week notice period).  You can dismiss an employee before 51 weeks, even after you previously confirmed they passed probation! 

Dismissing after this period can be time consuming, stressful and expensive.  I always ask when the employee problems started and so often the answer is “as soon as they started work”.  This is when you need to follow one aspect of Sir Alan’s approach.  Don’t dither – Do it!

Too late?

If you have missed the 51 week deadline, you can still dismiss but you must follow the new ACAS Code.  All grievance and disciplinary codes written before 6^th April 2009 must be updated.

The new code is easy to follow and has a common sense approach.  It doesn’t prescribe forms/paperwork but focuses on ensuring the procedure and decisions are fair and reasonable and the good news for SME’s is that reasonable is determined in relation to the size and resources of the organisation.

Unfortunately following the ACAS Code faithfully is still no guarantee that you won’t get hit with a claim because the claim form can be downloaded and lodged for free.  However there is no legal aid for employment tribunals and the free sources of legal support tend to carefully assess the chances of success (eg most legal expenses insurance companies will only accept a case with a 51% or greater chance of success).  So responding robustly to an ET1 (the Employment Tribunal Claim Form) and demonstrating that you followed the ACAS Code, can lead to a case being dropped by the legal team.  Then your employee has to decide whether to pursue the case at substantial cost to themselves because costs are very rarely awarded to either side by the tribunal. 

Once you have responded to a claim, ACAS will mediate between you and your employee free of charge so here is another chance to see off a claim without incurring huge costs.

This strategy only works if you can prove you followed the ACAS code and your decisions were fair and equitable in all the circumstances.  After the first year of service saying “You’re Fired!!!” will nearly always cost you and your company dearly, no matter what you believe your employee has done.  So always, without fail, act as soon as a problem occurs and never let employee problems persist beyond the 51 week point.

© 2009 Hornet Solutions Ltd

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