Handling termination of employment

Any termination of employment carries risk and can lead to claims of unfair dismissal and the award of substantial compensation. We ensure the correct procedures are followed to minimise the risk of any claim.


Termination of employment should only be used as a last resort.

In order to ensure a dismissal is fair an employer needs to meet the following 3 tests.

1. The reason for dismissal falls within one of the statutory reasons for dismissal i.e.

  • Conduct
  • Capability or qualifications for the job
  • Redundancy
  • Statutory duty or restriction prohibiting employment
  • Some other substantial reason

2. The decision to dismiss falls within a range of reasonable responses (unfortunately not defined by law!)

3. A fair process was used for dismissal

Meeting one or two of the tests will not be sufficient. Care should always be taken to avoid subsequent claims of unfair dismissal.

Some clients use settlement agreements, previously known as compromise agreements. This is legal device whereby an employee agrees to give up the right to take a claim against the employer in return for compensation. Extreme care needs to be used in determining when to introduce discussion of a compromise in to the process.

“We have been using David for several years as our sole HR consultant. He has helped us through a number of difficult cases where we have had to terminate contracts of employment. He has advised us on all related issues and conducted tricky negotiations on our behalf throughout the process, allowing us to avoid potentially large legal fees. During each and every case, David has guided us, as a management team, through the potential storm, ending always with a better than expected result. Highly recommended.”

Tony Layton, Managing Director, Words&Pictures, communications agency


Without professional support employers often spend a lot of management time and still fail to achieve a successful outcome.

E-mail david@cedargbltd.co.uk to discuss how David can help you with his substantial knowledge and experience.

Case Study

Terminating employment due to third party pressure in the waste services industry

Our client provides waste management services for a blue chip manufacturer involving provision of staff to the manufacturer’s site...

Read more >

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