Wrongful dismissal

Employees who cannot claim unfair dismissal (for example, because they have insufficient service) may be able to claim wrongful dismissal.

Wrongful dismissal is a claim for breach of contract. That breach of contract is the employer’s failure to give the proper notice demanded by the contract. In other words, damages in a wrongful dismissal claim are normally limited to the wages the employee would have earned during the notice period, less anything earned during that period (Smith v Trafford Housing Trust [2012] EWCA 3221). The employee has a duty to mitigate their loss (Cerberus Software v Rowley [2001] IRLR 160). Unless an employee has a lengthy contractual notice entitlement or is very highly paid, wrongful dismissal claims are rarely economically viable.

Usually the contract specifies the notice needed to end the contract. Employees who are wrongfully dismissed without proper notice can claim any rights they would have had during the period of the notice (Silvey v Pendragon [2001] IRLR 685), Societe Generale v Geys [2012] UKSC 63).

Where a contractual disciplinary or appraisal procedure has not been followed, the employee will be entitled to be paid for the amount of time it would have taken to operate the procedure properly, and may also be entitled to an injunction preventing the employer carrying out a dismissal without following the procedure.

A wrongful dismissal claim can be brought in either the civil courts or the employment tribunal. There is no financial cap on claims in the civil courts, whereas in the employment tribunal, compensation for breach of contract claims (including wrongful dismissal) is capped at £25,000.