Wrongful dismissal and unfair dismissal are frequently confused, but they are legally distinct claims with different tests, time limits, and remedies. Understanding the difference is important for employers assessing their exposure when a dismissal is challenged.
Wrongful Dismissal
Wrongful dismissal is a contractual claim. It occurs when the employer breaches the employment contract in the manner of the dismissal. The most common scenario is dismissing without giving the correct notice (or payment in lieu of notice).
Key Features:
- No qualifying period — can be claimed from day one
- Focus: Was the contract breached? (Usually: was proper notice given?)
- Remedy: Damages for the notice period the employee should have received
- Can be brought in: Employment tribunal (capped at 25,000) or civil court (uncapped)
- Time limit: 3 months minus a day for tribunal; 6 years for civil court
When It Arises:
- Dismissal without the contractual or statutory notice period
- Summary dismissal where the conduct does not actually amount to gross misconduct
- Breach of a contractual disciplinary procedure
Unfair Dismissal
Unfair dismissal is a statutory claim under the Employment Rights Act 1996. It focuses on whether the employer had a fair reason for dismissal and followed a fair procedure.
Key Features:
- Qualifying period: Currently two years (changing to day one under the Employment Rights Bill)
- Focus: Was the reason fair? Was the procedure fair?
- Remedy: Basic award (based on age, service, and weekly pay) plus compensatory award (capped at the lower of 52 weeks' pay or the current statutory cap)
- Can only be brought in: Employment tribunal
- Time limit: 3 months minus a day from the effective date of termination
Can Both Apply?
Yes. A single dismissal can be both wrongful and unfair. For example, if an employer dismisses an employee without notice, claiming gross misconduct, but the conduct doesn't actually amount to gross misconduct and the procedure was flawed, the employee could claim both:
- Wrongful dismissal — for the notice pay they should have received
- Unfair dismissal — for the lack of fair reason and fair process
Facing a dismissal challenge? Our tribunal representation service covers both wrongful and unfair dismissal claims. Get expert advice immediately.