Wrongful dismissal
If you’ve been dismissed from work then you may have a claim for wrongful dismissal against your employer.
This guides sets out what wrongful dismissal is and what steps you may need to take
What is wrongful dismissal?
Wrongful dismissal is a legal claim based on a breach of contract. It arises when an employer dismisses an employee in breach of the terms set out in their employment contract. Most commonly, it involves dismissing an employee without giving proper notice or failing to pay the correct notice pay.
How wrongful dismissal differs from unfair dismissal
Wrongful dismissal is a contractual issue, whereas unfair dismissal is a statutory claim based on an employee’s right not to be dismissed unfairly. Unfair dismissal claims consider the fairness of the employer’s actions, while wrongful dismissal focuses purely on whether the contract of employment has been breached.
Contractual obligations and employee rights
Every employee has a legal right to notice of termination, either statutory or contractual, depending on what is more generous. Wrongful dismissal occurs where an employer fails to meet these obligations, including the failure to follow contractual procedures such as disciplinary policies or notice periods.
Common examples of wrongful dismissal
Failure to give contractual notice
If an employer terminates employment without giving the agreed notice period, or payment in lieu of notice (PILON), this is typically wrongful dismissal. For example, if your contract requires three months’ notice and your employer dismisses you without notice or PILON, you may have a claim.
Immediate dismissal without valid contractual grounds
Summary dismissal — termination without notice — is only lawful if the employee is found guilty of gross misconduct. Dismissals that occur without sufficient grounds or due process may be considered wrongful if notice was contractually required.
Dismissal in breach of a fixed-term or notice period contract
Employees on fixed-term contracts may also bring a wrongful dismissal claim if their employer ends the contract early without a valid clause permitting this or without notice.
Legal requirements for notice periods
Minimum statutory notice
Employees are entitled to statutory notice after one month of service. This is:
- One week’s notice after one month of service
- One week for each year of service (up to 12 weeks) after two years
Contractual notice entitlements
If your contract provides a longer notice period than the statutory minimum, the contractual period applies. Employers must honour whichever is greater: the contractual or statutory notice period.
When notice pay must be provided
If the employer chooses not to require the employee to work their notice period, they must usually provide payment in lieu of notice (PILON), unless there has been gross misconduct.
Situations that may lead to a wrongful dismissal claim
Dismissal without a disciplinary process
Even where there is alleged misconduct, employers are generally expected to carry out a fair disciplinary process. Dismissing someone without any process could amount to wrongful dismissal, especially if the employment contract references a disciplinary procedure.
Constructive dismissal and its link to wrongful dismissal
Employees who resign in response to a serious breach of contract (constructive dismissal) may also claim wrongful dismissal if the employer failed to honour their contractual entitlements, such as notice pay.
Breach of disciplinary or grievance procedures
Where the contract refers to specific processes for managing disciplinary or grievance issues, failure to follow these before dismissal may result in a breach of contract claim.
Who can bring a wrongful dismissal claim?
Eligibility requirements
There is no minimum length of service required to bring a wrongful dismissal claim. The key issue is whether there was a breach of contract by the employer.
Employees still in probation
Even during probationary periods, employees are generally entitled to statutory notice unless gross misconduct is proven. Dismissing a probationary employee without notice or due process may give rise to a claim.
Fixed-term and zero-hour workers
Workers on fixed-term contracts and even some zero-hour contract workers may have a right to claim wrongful dismissal if the terms of their agreement are breached.
Making a wrongful dismissal claim
Time limits for bringing a claim
A wrongful dismissal claim can be brought:
- In the Employment Tribunal (within 3 months less one day of the dismissal), or
- In the civil courts (within 6 years in England and Wales)
Most employees opt for the Employment Tribunal route due to the lower cost.
Read more about: Employment Tribunal time limits
Where to bring a claim: Employment Tribunal or civil court
While the Tribunal is generally more accessible, it can only award damages up to the value of £25,000 for wrongful dismissal. If your claim exceeds this, you may wish to pursue it in the civil courts.
What evidence is required
To succeed in a wrongful dismissal claim, you will need to provide:
- A copy of your employment contract
- Details of your notice period
- Proof that your employer failed to honour this, either by failing to provide notice or by not paying in lieu
Remedies for wrongful dismissal
Notice pay and damages
The most common remedy is a payment equivalent to what you would have earned net (i.e. after tax) during the notice period, including salary, benefits, and any contractual bonuses due during that time, less any sums earned in the meantime.
Payment for lost contractual benefits
In some cases, employees may also claim for other lost contractual benefits—such as private healthcare, pension contributions, or bonuses—if these would have continued during the notice period.
Impact on references and future employment
Wrongful dismissal claims do not generally entitle you to reinstatement or compensation for emotional distress, but the impact on your reference and future job prospects may be relevant in related legal action.
Wrongful dismissal and settlement agreements
Can you claim wrongful dismissal after signing a settlement?
Settlement agreements often include a clause that waives your right to bring a wrongful dismissal claim. It is important to ensure that notice pay is explicitly included in the agreement to avoid underpayment.
Ensuring notice pay is correctly addressed in agreements
Where an employer fails to properly document PILON or omits notice pay from a settlement agreement, this may be a breach of contract. Legal advice should always be obtained before signing.
Differences between wrongful dismissal and other types of dismissal
Wrongful vs unfair dismissal
- Wrongful dismissal: Breach of contract; available regardless of length of service; focuses on notice/pay
- Unfair dismissal: Breach of statutory rights; available after two years’ service (in most cases); focuses on fairness of the dismissal process
Wrongful dismissal and discrimination claims
If dismissal occurs in circumstances involving discrimination or protected characteristics (such as pregnancy, race, or disability), this may give rise to additional Equality Act claims alongside wrongful dismissal.
Legal advice for employees
Why legal advice is recommended
An employment solicitor can assess whether your dismissal breached your contract and what level of compensation you may be entitled to. This is especially important where bonuses or other contractual benefits are at stake.
Assessing your employment contract and dismissal circumstances
Lawyers will examine your contract, notice clause, disciplinary policies, and termination correspondence to evaluate your position.
How a solicitor can help you claim compensation
A solicitor can assist with negotiating a settlement, pursuing a Tribunal claim, or preparing for a civil court action if your losses exceed the Tribunal limit.
The information on this page is intended for general informational purposes only and does not constitute legal advice.
Contact Our Employment Solicitors
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Tessa Harris supervises our employment law team and has extensive experience in advising employees on employment claims, Employment Tribunal proceedings, and settlement agreements.
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