Dismissals

What is a Dismissal

Employment can end in different ways and there are three ways by law that constitute a 'dismissal':

The employerdismisses the employee with or without notice (the latter being in cases of gross misconduct)
A fixed term contract comes to an end and is not renewed; and
The employee terminates the contract with or without notice due to the behaviour of the employer – effectively dismissing themselves which is known as constructive dismissal

Dismissal by an Employer

Qualifying Service

An employee who has been continuously employed for one year or more has the legal right not to be unfairly dismissed.

Some dismissals are considered automatically unfair, even if the employee has less than one year’s continuous service.

Asserting a legal right under the Employment Act 2006
Certain health and safety matters
Making a protected disclosure (often referred to as 'whistleblowing')

This is not a complete list. For more detailed guidance, please see the Department for Enterprise – Isle of Man: Employment Rights – A Guide.

When a dismissal is fair

For a dismissal to be considered fair, both of the following must apply:

The employer must have a fair reason for the dismissal (one of the five reasons set out in the Employment Act 2006), and
The employer must follow a fair procedure when making the decision

However, dismissing employees should be the last resort and employers should carry out necessary investigations without unreasonable delay to establish the facts. It is best practice to try and resolve any issues informally first and in many cases a quiet word is all it takes to resolve matters.

Potentially Fair Reasons for Dismissal

An employer must be able to show that the reason (or if more than one, the principal reason) for dismissal falls into one of the below categories:

Conduct: e.g., misconduct (either a single act or a series)
Capability: e.g., poor performance or ill health
Redundancy: the employer has ceased the business (or intends to) or the demand for the role has diminished to do work of that kind overall or in a particular place
Illegality: where it would be illegal to continue employment e.g. loss of work permit
Some Other Substantial Reason (SOSR): other valid business reason

Fair Process

Even if the reason for dismissal is for one of the five fair reasons above, employers must follow a fair and reasonable procedure in deciding to dismiss the employee. That normally includes:

Communicating the concerns to the employee
Giving them a chance to respond
Considering any explanations before a final decision is made

Employers should make sure that any process that is followed aligns with the Code of Practice on Disciplinary and Grievance Procedures 2007 - please see our page on Disciplinary and Grievances for more information.

Notice and Pay

Unless the dismissal is for gross misconduct, the employer must pay the employee their notice as per the contract of employment or the statutory minimum under the Employment Act 2006 (whichever is the highest).

Written statement of dismissal

If an employee is dismissed whilst pregnant, on ordinary or additional maternity leave or ordinary or additional adoption leave they must be given a written statement of the reason(s) they were dismissed
In all other cases, if an employee wishes to have a written statement of dismissal they must request one from their employer who must then provide this within 14 days

Types of Complaints

Dismissal complaints can be divided into two categories:

Unfair dismissal: when the employer dismisses the employee and the employee believes the reason or process followed was unfair; or
Constructive dismissal: where the employee asserts the employer has repudiatory breached the contract of employment (committed a fundamental breach) and resigns without notice effectively 'dismissing' themselves

Important: For both complaints the time limit for filing any complaint to the Employment and Equality Tribunal is 3 months less a day from the effective date of dismissal.

MIRS assistance

Dismissal issues can be complex and very context specific. If you are unsure about any of the above either as an employer or employee please get in touch with us and we would be happy to help.

Summary

Only available to employees (not workers)
Requires 1 years continuous employment, except for automatically unfair dismissals
The burden of proof to show the dismissal was fair is on the employer

Fair Reasons

Conduct: e.g., misconduct (either a single act or a series)
Capability: e.g., poor performance or ill health
Redundancy: the employer has ceased the business (or intends to) or the demand for the role has diminished to do work of that kind overall or in a particular place
Illegality: where it would be illegal to continue employment e.g. loss of work permit
Some Other Substantial Reason (SOSR) – other valid business reason

Procedure / Reasonableness

The question of whether or not a dismissal is fair or unfair with regards to the reason above will ultimately be decided by the Employment and Equality Tribunal and will depend on whether the employer has acted reasonably in treating the reason to dismiss as sufficient (i.e. was the dismissal justified in all the circumstances).

The Tribunal will consider whether, in all the circumstances including the employer’s size and administrative resources, the dismissal was reasonable both in terms of the decision to dismiss and the process used in reaching it.

It should be noted that it is important to be clear on the reason for the employee falling short of expectations as a conduct issue will be dealt with very differently than a capability issue.

Unfair Dismissals

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Constructive dismissal is a type of dismissal whereby the employee feels forced to resign because of the actions of the employer. This is often called a 'repudiatory breach' of the contract of employment by the employer, in so far as the employee feels the employer has broken the contract of employment irreparably.

Examples of such treatment might include:

A serious breach of contract (e.g. consistently not paying an employee)
Forcing an employee to accept unreasonable changes to his or her conditions of employment without agreement, e.g. demotion for no reason
Bullying or discrimination by work colleagues or the employer
Making the employee work in dangerous conditions

Resigning can be a difficult decision and these can be hard cases to win but in order to bring a successful claim of constructive dismissal the employee must establish that:

The employer was in breach of an express or implied term of the contract of employment
The breach (or series of breaches) was so serious as to entitle the employee to treat the contract as having been repudiated by the employer; and
The employee resigned because of that breach of contract (and neither delayed resigning nor resigned in anticipation of a possible breach)

Constructive Dismissal

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