Dismissal

The final payment to an employee must include:

• normal pay up to the date of termination
• untaken holiday pay
• any pay in lieu of notice
• all bonuses, overtime, or benefits calculated up to the date of termination

If the employee has caused damage, this cannot be deducted unless the contract allows it.

In a summary dismissal, do not include pay in lieu of notice. You may limit holiday pay just to statutory holiday entitlement if the contract allows.

For information on tax treatment of final payments see our guide on how to sort out tax matters when an employee leaves.

Record keeping

Keep records on:

• the nature of any breach of disciplinary rules
• the action taken
• the reasons for the action
• whether an appeal was lodged
• the outcome of the appeal and any subsequent developments

You must keep records confidential and carefully safeguarded. Do not keep them for any longer than necessary. Let employees know how long a disciplinary record will be kept on their file.

Written reasons

If an employee requests to see the reasons for their dismissal in writing, you must provide the information within 14 days of the request if they have at least one year's service. You should automatically give written reasons to any woman dismissed while she is pregnant or on statutory maternity leave. 

The written reasons can later be used at an employment tribunal as evidence, but failure to provide written reasons can lead to a tribunal award of two weeks' pay.

References

You may be asked to provide a reference on or after the termination of an employee's employment. You should take great care in writing any reference and ensure it is true, accurate and fair to avoid potential legal action by either the employee or the new employer.

It is increasingly common merely to provide a confirmation that the employee worked for you for a specified period of time. However, this must be applied to all employees and they should be informed that this is your organisation's policy.

Subjects covered in this guide

• Introduction
• Types of dismissal and qualifying periods for tribunal claims
• Dismissing fairly
• Unfair reasons for dismissal
• Avoiding unfair dismissal and the consequences of getting it wrong
• Dismissals on performance grounds
• Dismissals on capability grounds
• Dismissals relating to industrial action
• Notice periods
• Final payments and other matters

 

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