Will Covid 19 re-define the ‘fair and reasonable’ test for employers who dismiss their employees?

Employees who have been employed for two continuous years have a right not to be unfairly dismissed. Potentially fair reasons under S98 of the Employment Rights Act 1996 (ERA) allowing an employer to dismiss include redundancy and “some other substantial reason” or SOSR for short.

But that’s not the whole story. Even if an employer can identify a fair reason to dismiss – as many will be able to during this global crisis – the dismissal still has to be fair in ‘all the circumstances of the case given the size and resources of the employer’( S94 ERA). Judges and lawyers refer to this as the band or ‘range of reasonable responses’ open to the employer, given the situation before them.

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This blog is being written on the morning of Friday 20 March 2020.  The UK is waiting for an announcement later today from the Chancellor of the Exchequer, Rishi Sunak, on what measures it will give businesses to help them retain their staff. If vast sums from the public purse are going to be given to businesses for this very purpose will an employer still be able to justify dismissals? Whether an employer which dismisses employees has satisfied this long established ‘range of reasonable responses’ test is likely to be a complex and hotly disputed issue in the months and possibly years ahead.

NB: The right not be unfairly dismissed only applies to employees and not casual workers or those on zero contracts.