James Comey, the former FBI Director, is in the headlines again today following his shock dismissal by President Trump yesterday. For political reasons it is by no means a straightforward termination. But, generally speaking, summary dismissals are far easier to effect in the US than the UK – most employees in the US are employed ‘at will’ and may be dismissed immediately without notice or compensation. The summary dismissal landscape in the UK is more complex.
If you are thinking of dismissing an employee without notice in the UK, there are some key points to be aware of:
- Are you dismissing for cause? Make sure the dismissal reason falls within one of the summary termination heads in the employment contract. Be wary of dismissing for cause without first allowing the employee a reasonable opportunity to put across their side of the story – otherwise you will be handing the employee a successful unfair dismissal claim.
- You need to be aware of the Supreme Court judgment in Societe Generale, London Branch v Geys . In Geys, the court held that where an employer tells an employee that they are being summarily dismissed but does not effectively rely on a contractual provision to make the termination, the employer commits a repudiatory breach of contract. It is then open to the employee not to accept the breach. If the employee does indeed refuse to accept the breach and affirms the contract, the employment contract continues until either the breach is accepted or the contract is lawfully terminated.
- In most cases it will not make a material difference if the employment drifts on for a while longer, but in some instances the employee may benefit from a large windfall if their termination date is postponed - eg they may receive a bonus or increased pension entitlement which would otherwise not have been due. The lesson from Geys is this - if you are intending to terminate under a contractual provision (eg under a payment in lieu of notice clause), make this clear when communicating the dismissal and comply with the terms of the relevant clause.
- Where an employee is terminated summarily (and not for gross misconduct), their ‘effective date of termination’ will be notionally extended by the statutory notice period to which they would have been entitled for certain purposes – the principal purposes being to work out if the employee has met the service requirement to bring an unfair dismissal claim or is entitled to an unfair dismissal basic award.