This item is prepared by the London office of a global law firm (Holborn Gate, 330 High Holborn, London, WC1V 7QH) and considers the law on termination of employment in England and Wales. The title references a foreign statute but the practical guidance below applies to England & Wales: employers and employees should follow UK statute, case law and ACAS guidance when managing dismissals and redundancies.

When can employment be terminated?

In England & Wales, dismissal must be for a potentially fair reason and, where necessary, carried out fairly. Statutory fair reasons include:

• Capability or qualifications (including long-term ill health);
• Conduct (including gross misconduct justifying summary dismissal);
• Redundancy (genuine business need to reduce workforce);
• Statutory illegality or a reason relating to a statutory restriction; and
• Some Other Substantial Reason (SOSR) — a broad category for business-related causes that do not fit the above.

Employees with at least two years’ continuous service generally have protection against unfair dismissal, subject to limited exceptions (for example, automatically unfair dismissals for discrimination, whistleblowing or exercising statutory rights can be brought without the two‑year qualifying period).

Notice, pay in lieu and summary dismissal

Statutory minimum notice depends on length of service (one week’s notice after one month’s continuous employment, increasing with service), but contractual notice may be longer. Employers may pay in lieu of notice (PILON) if the contract allows; otherwise, payment for notice may be a breach of contract unless a negotiated settlement is reached.

Summary dismissal (dismissal without notice) is permissible only for gross misconduct where an employer’s investigation and reasonable belief in the employee’s guilt is established. Failure to follow fair procedure can convert an otherwise potentially fair dismissal into an unfair dismissal.

Procedure, consultation and risk management

Following a fair procedure is critical. The ACAS Code of Practice on disciplinary and grievance procedures is not compulsory but tribunals will take it into account when assessing fairness and may adjust compensation for unreasonable failure to follow it.

For redundancies of 20 or more employees at one establishment within a 90‑day period, collective consultation obligations apply (including notification to the Secretary of State and consultation with employee representatives). Failure to consult can give rise to protective awards.

Tribunal claims and remedies

An employee may bring claims to an Employment Tribunal for unfair dismissal, automatic unfair dismissal, discrimination, unpaid notice or unlawful deduction of wages. Remedies can include reinstatement/re-engagement orders, basic and compensatory awards for unfair dismissal, and additional awards for breach of statutory consultation obligations.

Practical checklist for employers

• Confirm the correct legal basis for proposed dismissal and check contractual notice provisions.
• Carry out a prompt, documented investigation and provide the employee an opportunity to respond.
• Apply the ACAS Code: hold a disciplinary hearing, allow representation, and offer right of appeal.
• Check for potential discrimination, whistleblowing or other automatically unfair reasons.
• For collective redundancies, begin consultation early and notify the Secretary of State where required.
• Consider settlement agreements where appropriate to avoid litigation and clarify post‑termination obligations.

Jurisdiction and sources

• Employment Rights Act 1996 (statutory framework for dismissal and notice)
• Equality Act 2010 (discrimination protections)
• Trade Union and Labour Relations (Consolidation) Act 1992 (collective redundancy and consultation rules)
• ACAS Code of Practice on Disciplinary and Grievance Procedures and ACAS guidance
• GOV.UK guidance on dismissal and redundancy

General information only; not legal advice and not a substitute for advice on a particular matter.