1. ACCAspace Provided by ACCA Research Institute Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 ACCA F4 Corporate and Business Law (CL) 公司法与商法 ACCA Lecturer: Eli Qiu

2. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 2 Chapter 8 Dismissal and redundancy

3. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 3 Chapter guide Explain termination of employment by notice Distinguish between summary and constructive dismissal Explain wrongful dismissal Explain unfair dismissal, including the procedure, and fair and unfair reasons for dismissal Discuss the remedies available to those who have been subject to unfair dismissal Explain what is meant by redundancy

4. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 4 1 Explain termination of employment by notice a)The period of notice given must not be less than the statutory minimum, whatever the contract may specify b)It may be given without specific reason for so doing, unless the contract requires otherwise c)If the contract states that notice may only be given in specific circumstances then generally it may not be given for any other reason Chapter 8 Dismissal and redundancy

5. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 5 Although there is no breach of contract, termination by notice or non-renewal qualifies as ‘dismissal’ under the statutory code. This means that the employee may be entitled to compensation for unfair dismissal. Statute imposes a minimum period of notice of termination to be given on either side Chapter 8 Dismissal and redundancy

6. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 6 1.1 Minimum period of notice Where employment is terminated by notice the period given must not be less than the statutory minimum. If an employer terminates the contract of employment by given notice, the minimum period of notice to be given is determined by the employee’s length of continuous service for the employer as follows a) An employee who has been continuously employed for one month or more but less than two years is entitled to not less than one’s week’s notice. Chapter 8 Dismissal and redundancy

7. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 7 b) An employee who has been continuously employed for two years or more but less than twelve years is entitled to one week’s notice for each year of continuous employment. c) Any employee who has been employed for twelve years or more is entitled to not less than twelve weeks’ notice Chapter 8 Dismissal and redundancy

8. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 8 - Working time notice period At least 1 month to 2 yearA week 2 years to 12 yearsAt least 2 week but no more than 12 weeks More than 12 yearsAt least 12 weeks Chapter 8 Dismissal and redundancy

9. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 9 Which is the correct minimum period of notice an employee is enti tled to after five years service? A One calendar month B Five weeks C Ten weeks D Five calendar months 2014.12 Chapter 8 Dismissal and redundancy

10. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 10 If the employee gives notice, the minimum period required is one week if they have been employed for at least one month The notice must specify the date of its expiry. Either party may waive their entitlement to notice or accept a sum in lieu of notice The statutory rules on length of notice merely prescribe a minimum. If the contract provides for a longer period, notice must be given in accordance with the contract. During the period of notice an employee is entitled to pay at a rate not less than the average of their earnings over the previous 12 weeks. Chapter 8 Dismissal and redundancy

11. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 11 If the employee is dismissed in any way they may request their employer gives them a written statement of the reasons for their dismissal and the employer must provide it within 14 days. The statement must contain at the least a simple summary of the reasons for dismissal and can be used as admissible evidence before an employment tribunal Dismissal is the word used to describe termination of an employment contract by the employer Chapter 8 Dismissal and redundancy

12. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 12 2 distinguish between summary and constructive dismissal Summary dismissal occurs where the employer dismissed the employee without notice. If there is no serious breach then summary dismissal constitutes breach of contract so under common law the employee may claim a remedy for wrongful dismissal. Chapter 8 Dismissal and redundancy

13. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 13 Which of the following involves a summary dismissal in relation to a contract of employment? A both parties agree to end the contract immediately without notice B The employee breaks the contract without notice C The employer terminates the contract without notice 2014.12 Chapter 8 Dismissal and redundancy

14. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 14 Constructive dismissal occurs when an employee, who has resigned, is able to prove they did so under duress from their employer, and as such was therefore actually dismissed. It is up to the employee to prove there was sufficiently unfair behavior by the employer to constitute a material breach of contract, case law examples include: a) Changing terms of the contract without consultation b) Making significant changes to the location of work at short notice c) Victimizing or harassing staff Chapter 8 Dismissal and redundancy

15. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 15 3 Explain wrongful dismissal 3.1 It is possible to terminate the contract of employment in the several ways that do not amount to a breach of contract, such as death, mutual agreement and expiry of a fixed term. Additionally contractual notice periods can be served, or payment given in lieu of notice. Chapter 8 Dismissal and redundancy

16. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 16 3.2 Wrongful dismissal is a common law claim that can be made where an employee has been denied their required notice period. This is commonly claimed by employees that do not qualify for unfair dismissal. Wrongful dismissal is comparable with a breach of contract Chapter 8 Dismissal and redundancy

17. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 17 A dismissal cannot be wrongful if it was justified, for example because the employee willfully disobeyed a lawful order in a way that amounts to a willful and serious defiance of authority. Other justifications include misconduct, dishonesty, incompetence or neglect, gross negligence, immorality and drunkenness. When claiming damages for loss of earnings for wrongful dismissal, the claimant must show that they took steps to mitigate their loss of earnings, be seeking other employment for instance. Chapter 8 Dismissal and redundancy

18. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 18 4.1 unfair dismissal is a statutory claim made by ‘qualified ’ employees who have been ‘unfairly dismissed’. Anyone who anyone employee with at least one year’s (two years for those employed after April 2012) continuous service has the right not to be unfairly dismissed Chapter 8 Dismissal and redundancy

19. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 19 4.2 some reasons are automatically unfair (known as inadmissible reasons), examples include: Pregnancy or other maternity-related grounds A spent conviction under the rehabilitation of Offenders Act 1974 Trade union membership or activities Dismissal on transfer of an undertaking (unless there are economic, technical or organisational reasons justifying the dismissal ) Taking steps to avert danger to health and safety at work Seeking to enforce rights relating to the national minimum wage Exercising rights under the working time regulation 1998 Chapter 8 Dismissal and redundancy

20. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 20 Refusing or opting out of Sunday working (in the retail sector) Making a protected disclosure order under the Public interest Disclosure Act 4.3 Additionally it is worth noting however that there are a number of persons who are automatically unable to make a claim for unfair dismissal, including members of the police and armed forces 4.4 Other reasons are designed as being automatically fair legislation Taking part in unofficial industrial action Being a threat to national security Chapter 8 Dismissal and redundancy

21. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 21 4.5 A dismissed employee must bring a claim to an employment tribunal within three months of dismissal. At this hearing the employer must prove they has one of the following fair reasons to dismiss the employee: a)Capability or qualifications b)Gross Misconduct c)Redundancy d) Statutory restrictions – such as a bus driver who receives a driving ban e) The retirement of the employee f) Other substantial reasons- such as dismissing a temporary Chapter 8 Dismissal and redundancy

22. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 22 Which two of the following are reasons for dismissal which must b e justified as fair ? 1) capability or qualification of the employee 2)legal prohibitions relating to the employee 3) refusal of the employee to join a trade union 4 ） taking part in unofficial industrial action A 1 and 2 B 1 and 3 C 2 and 3 D 2 and 4 Chapter 8 Dismissal and redundancy

23. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 23 5 Discuss the remedies available to those who have been subject to unfair dismissal An unfair dismissal claim is a statutory claim so is therefore brought before an employment tribunal. Any subsequent tribunal. The tribunal has the power to award the following types of remedies: a)reinstatement- being restored to your old position b) re-engagement- being re-engaged in a different, but comparable position Chapter 8 Dismissal and redundancy

24. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 24 c)Compensation –there are three elements to an award: Basic award, linked to age and length of service Compensatory award- of up to £68,400 for loss of wages may be made in addition to the basic award at the discretion of the tribunal, with a joint award capped at £80,400 Additional award, of up to 52 weeks’ pay may be granted in cased of sex or race discrimination. In addition, however, a compensatory award of up to £22,360 may be made where the employer ignores an order for re-employment or re-engagement Chapter 8 Dismissal and redundancy

25. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 25 Chapter 8 Dismissal and redundancy ageentitlement 18-211/2 22-401 41+11/2 The basic award is limited to a maximum 20 years, and assumes a maximum weekly wage of £400, thereby capping claims at £12,000

26. Copyright © ACCAspace.com ACCAspace 中国 ACCA 特许公认会计师教育平台 26 6 explain what is meant by redundancy The employer has ceased,or intends to cease,to carry on in business for the purpose of which the employer was employed, or in the place where the employee was employed. That the requirements of that type of business for employees to carry out work of a particular kind, or in a particular place have ceases, or are expected to diminish or cease. In order to make a redundancy claim there are two qualification criteria that the employee must prove: a)That they were an employee b)Two years continuous employment have been served Chapter 8 Dismissal and redundancy

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