If an employee has been found to have been unfairly dismissed by an Employment Tribunal, they can ask the Employment Tribunal to order that their employer re-employ them into their original position as if the dismissal had not taken place. This is known as reinstatement.
Re-engagement is where an employee is ordered to be re-employed, not in their original role, but in a different position on terms no less favourable to their previous role. If a Tribunal decides that reinstatement is not feasible, it must consider whether to order re-engagement as an alternative.
In reality very few employees ask to be reinstated by their employer because there has been too much bad feeling, and it can be difficult to rebuild trust. Even if an employee asks to be reinstated, it is rare for an Employment Tribunal to make an order for reinstatement as Tribunals recognise the difficulties that this can cause on a practical level.
When considering making an order for reinstatement, the Tribunal will assess the practicalities of such an arrangement. For example, if the business has undergone significant changes since the dismissal, like restructuring or redundancy, reinstatement might not be possible. The Tribunal will also consider other factors, like the employee’s conduct. If the employee’s conduct contributed to the dismissal, the employer is likely to argue that reinstatement is not appropriate. Equally, if the relationship has broken down irreparably, this is a strong indication that reinstatement is not a possibility.
If the Employment Tribunal is considering whether to order re- engagement, it must look at the practicability of the re-instatement at the time of the decision. Therefore, if a considerable amount of time has passed between the employee’s dismissal and the hearing at which the remedy is decided, the Tribunal will consider the state of the relations between the parties and the employer’s business at the time of that remedy hearing, not at the time of the dismissal or the liability hearing. Bearing in mind that it can take more than a year for a case to get to a liability hearing, let alone a remedy hearing, and the fact that the dispute has gone unresolved for that length of time, it is easy to see why reinstatement is so rarely awarded.
The effect of reinstatement is that it involves the employer treating the employee as if they had never been dismissed – restoring their employment on the same terms and conditions without any loss of continuity of service. The employee will also be entitled to receive the benefit of any pay rises or other enhancements to their terms of employment that they would otherwise have received had they not been unfairly dismissed.
The Tribunal will also usually order that the employer pay the employee back-pay for the period between the date they were dismissed and the date they were reinstated and make up for any lost benefits for that period. This can be a significant sum where the employee was a very high earner – and it is not subject to the statutory cap that applies to compensation for unfair dismissal. This is why it is relatively common tactic for high earning employee who bring unfair dismissal claims, to ask to be reinstated. If the employer fears there is a realistic possibility that reinstatement could be awarded, this could drive up settlement figures to beyond the statutory cap.
If a Tribunal orders reinstatement and the employer refuses to do so, the employer can normally expect to be penalised. The Tribunal will assess how much compensation to award the employee for unfair dismissal in the normal way (i.e. by reference to their actual and future loss of earnings). However, the tribunal will also make an additional award of between 26 and 52 weeks’ pay in order to penalise the employer for failure to comply with the tribunal’s order.
Reinstatement is a significant remedy however it is the remedy that is seldom sought and less still awarded. Whilst employers should not entirely dismiss the possibility of a tribunal awarding an employee re-instatement, the tribunals are alert to the real practical difficulties of making such an award and the likelihood that, in the overwhelming majority of cases, it will not be successful.
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The information contained in this blog post is provided for guidance and is a snapshot of the law at the time it is written. It is provided for your information only and should not be used as a substitute for obtaining legal advice that it specific to your particular circumstances.
The guidance should not be relied upon in any decision making process. It is strongly recommended that you seek advice before taking action.
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