When can you dismiss an employee for Some Other Substantial Reason?
Some other substantial reason or SOSR is a potentially fair reason to dismiss an employee and as you can probably tell by the words ‘some other’ it is designed to cover those scenarios that may not already be covered by the other 4 potentially fair reasons (conduct, capability, redundancy and illegality).
The Employment Rights Act which covers the law regarding unfair dismissal states that it must be of ‘some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held’.
Unfortunately for all parties involved there are no hard and fast rules set out in the Employment Rights Act about what is a ‘substantial reason’ for dismissal and when such a dismissal will be fair, which means that each case will depend on the facts and circumstances.
There are however some guiding principles you can follow and of course previous cases to provide an example.
Key points to consider for a fair dismissal for an SOSR reason
1. The reason must be substantial;
2. The reason must be something that could justify dismissal instead of giving a warning or other sanction; and
3. Dismissal must be appropriate for the employee’s role and the circumstances
The Employment Tribunal approach to SOSR reasons for dismissal
The Employment Tribunal will take a two-stage approach to establishing if the dismissal was fair or not;
1. Was there an SOSR reason which could justify the decision to dismiss?
2. Was the decision of the employer reasonable in all of the circumstances?
You should therefore have these questions in mind when making a decision to dismiss an employee for an SOSR reason.
Reasonableness of the decision
The reasonableness of the decision will depend largely on the procedure followed and the fairness of the procedure which led to the decision to terminate the employee’s employment.
Whilst case law in the Employment Appeal Tribunal has confirmed that the ACAS code of practice does not necessarily apply to a dismissal for an SOSR reason it is advisable to follow the principles of the code in reaching any decision to dismiss as it will assist in demonstrating that you have followed a fair process.
It will also reduce the risk of a 25% uplift in compensation in the event that the Employment Tribunal decide that the reason for dismissal was not an SOSR but rather a conduct issue.
A fair procedure involves considering the issue in hand, discussing it with the employee and allowing them the opportunity to respond. Once it has been discussed and the employee response received you should give consideration to the employee’s response and where this impacts the outcome of some other work is required before deciding to dismiss.
For example: in a case decided by the Employment Appeal Tribunal where the employee was dismissed due to a breakdown in the relationship between employee and employer the Employment Tribunal and Employment Appeal Tribunal decided that the dismissal was unfair as the employee had not been given the opportunity to return to work and to demonstrate that the relationship had or had not broken down before a decision was taken to dismiss her.
Examples of SOSR dismissals
1. Refusal to accept changes to contract terms
Where an employee refuses to accept a change to their terms and conditions of employment the only option available could be to give them notice to terminate employment and offer to re-engage on the new terms.
If the employee makes a claim for unfair dismissal you could rely on this as an SOSR reason for dismissal.
In order to demonstrate that this is a fair reason for dismissal you must be able to show that you were implementing the changes for ‘sound business reasons’. The test here is not particularly high and as long as you can show that you were doing so for business reasons, and demonstrate with evidence, rather than some other arbitrary reason, it is likely that the Employment Tribunal will agree that you have a fair reason for dismissal.
2. Breakdown in trust and confidence
It is likely to be harder to successfully rely on a breakdown in trust and confidence with an employee than the other examples given. Therefore, I recommend that you take care about dismissing an employee if this is the reason you intend to rely on and ensure that you have exhausted other options first.
3. Pressure from a customer or other third party
This situation arises commonly in-service industries where the employer provides employees to work on the customer or clients site, such as contract cleaners, maintenance personnel and security guards. In these circumstances if the customer says that they do not want the employee to work on their site anymore and there is no other role or alternative site for them, then it is possible that the dismissal will be fair for a SOSR reason.
In these circumstances it is important to try to ascertain the reason for the customer’s request and if it is an unreasonable request attempt to mediate and/or persuade them to change their mind or give the employee a second chance (and document your attempts). If despite your efforts, they continue to insist that the employee is removed you are more likely to succeed in arguing the fairness of the dismissal.
I advise my clients in these circumstances to ask the customer to put their instruction in writing so that it can be referred to in discussions with the employee and used in evidence (if needed) later on.
4. Reputational Risk
This is where you basically decide that you cannot continue to employ the employee because of the risk to your business and reputation if you continue to employ them.
As with each of these scenarios they are very fact sensitive, but if your industry requires a high level of confidence, or safeguarding, it is more likely that if an employee is accused of behaviour that goes against the confidence and trust needed in the business, that their dismissal will be fair.
In addition to being dependent on the nature of the business and the issue causing the reputational risk, it will also depend on what the employees job role is. For example; the reputational risk associated with a senior employee is likely to be higher than that of a junior role, or a customer facing role verses back office role.
5. Differences between employees
Whilst a breakdown in relations between employees can potentially be a fair reason for dismissal it would have to be fairly extreme to justify dismissal and it should be seen as a last resort and only when it becomes a business-critical issue.
6. Return to work of employee they have been taken on to replace
Where you take someone on as temporary cover for an employee who takes family leave, for example maternity or adoption leave. In these circumstances the employee taken on to cover will be dismissed for an SOSR reason.
It is advisable to ensure that the employee whom you take on to cover is made aware that this is the purpose of their employment and that you still follow a fair procedure, including considering if there are any other suitable vacancies in the business.
7. Expiry of a fixed term contract
Where a fixed term contract is used for a genuine purpose or to fulfill a piece of work then dismissal at the end of the fixed term can normally be justified as a SOSR reason. However, you need to take care to ensure that it is a genuine fixed term contract and that there is not a redundancy situation.
If you are taking a decision to dismiss an employee, it is important to take a considered and measured approach to the decision. If you are in any way unsure it is important to seek advice on the specific circumstances to avoid a potentially expensive unfair dismissal claim.
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