Under Section 94 of the Employment Rights Act 1996, employees have the right not to be unfairly dismissed. A dismissal may be considered unfair if there was no valid reason for it or if the employer failed to follow a fair process.

Valid reasons for dismissal can include conduct issues such as gross misconduct or repeated disciplinary problems (where proper procedures are followed), capability or performance concerns where an employee is unable to meet role requirements despite support, redundancy if the role is no longer required and fair consultation and selection processes are carried out, or illegality where continuing employment would breach the law, for example, immigration or regulatory restrictions.

In addition, dismissals may be justified under Some Other Substantial Reason (SOSR), such as a breakdown in working relationships or reputational risks. However, even where a valid reason exists, dismissals can still be found unfair if employers do not comply with the Acas Code of Practice on Disciplinary and Grievance Procedures. Importantly, failure to follow the correct procedures can increase compensation awards by up to 25%.