An employer wants to dismiss an employee with six months’ service, yet the individual has asked to raise a grievance. Can the employer reject this request? Esther Smith, partner at Thomas Eggar, and Martin Brewer, partner at Mills & Reeve, advise.

The question:

An employee joined six months ago to undertake a difficult task. Documented objectives were achieved, despite evidence that some board members – who were not in favour of the task – failed to support his activity. The board has now decided not to proceed as originally planned – leaving the employee in an untenable position.

The employee signalled that a compromise agreement offering three months’ pay in lieu of notice period, plus a further three months’ pay, would be an acceptable exit strategy. His manager rejects this – relying on the fact he has been with the company less than a year to simply dismiss him with three months’ notice.

The employee asked to raise a grievance – on the basis that management’s failure to support him properly has led to this situation. The employee’s contract says the grievance process is intended as a guide to best practice, not as a contractual right. Is it legitimate to reject the employee’s request, and give him notice, or are we at risk of some form of breach?

Legal advice:

Esther Smith, partner, Thomas Eggar

Given that the employee in question only has six months’ service and is therefore unlikely to be able to pursue a claim against the company as a result of his situation, I think that his manager was right to reject the compromise proposal he put forward.

On the grievance front, the employee is entitled to raise a grievance, under statute if not his contract. As this is a statutory right it is sensible to address any grievance he raises in accordance with the statutory procedure.

Ordinarily with an employee with less than a year’s service I would advise that you simply serve notice to dismiss in accordance with his contract. However, one of the ‘special’ unfair dismissal claims, for which an employee does not need a year’s service, arises where the employee is dismissed for exerting a statutory right. As the right to raise a grievance is a statutory right, if we dismiss the employee because he has raised a one in the first place then he may have an unfair dismissal claim irrespective of the length of his service.

Therefore if we do want to dismiss him, it is important that we back up the reason for this as being related to the Board’s decision not to pursue the original plan to separate it from his raising of a grievance.

The best way to do this I think would be to address his grievance, and run the grievance process, alongside the dismissal. This demonstrates that we are happy to deal with his grievance and also suggests that the dismissal is not related to the grievance but to the untenable nature of his position.

Esther Smith is a partner in Thomas Eggar’s Employment Law Unit. For further information, please visit Thomas Eggar.

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Martin Brewer, partner and employment law specialist, Mills & Reeve

As with all employees who have less than one year’s continuous service this employee cannot yet claim unfair dismissal (unless a dismissal was for asserting health and safety rights, asserting a statutory right or one of the other inadmissible reasons where no particular period of service is necessary). In the absence of discrimination therefore, the risk to you is very small that a dismissal will result in a claim.

A compromise agreement is used to compromise potential claims. The question which springs to my mind from your facts is: What claims are you proposing to compromise? It seems to me there is no suggestion from you that this employee has any claims at all so why pay over the odds?

The same issue arises in relation to the grievance. In cases where the employee has the right to make a claim to a tribunal the grievance issue is vital as it impacts on jurisdiction and your failure to follow the statutory grievance procedure will lead to an uplift in any compensation. But it follows that if in fact the employee has no claim, this is not something you need be concerned about.

If there are no ‘real’ claims then perform the contract by giving the employee contractual notice or pay in lieu (if the contract allows for this).

Martin Brewer can be contacted at [email protected]. For further information, please visit Mills & Reeve.

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