Unlawful dismissal refers to a situation where employment is terminated illegally. The liberties that employers have to fire individuals can vary depending on where they operate. There are, however, generally some reasons in each jurisdiction that an employer is not allowed to dismiss a person. When employers defy the laws that impose these limits, their businesses can be greatly affected.
Many people mistakenly believe that unlawful dismissal cannot occur when there are employment-at-will clauses. These laws grant the liberty to either the employer or employee to terminate the relationship without a reason. Still, there are numerous instances when that liberty is not absolute for the employer. For example, an employer cannot discriminate.
Avoiding discrimination can be a lot more difficult than it implies. The laws regarding what is considered unfair are rapidly expanding. There are multi-jurisdictional laws prohibiting discrimination for sexual orientation, ethnicity, and disability, to name a few. When a jurisdiction deems a certain basis for a decision as discrimination, it is a crime for any organization to stop working with a person for that reason. For millions of businesses, this means a person cannot be fired for being pregnant, old, or homosexual.
The law also tends to deem it unlawful dismissal when people are let go because they took certain actions that can negatively affect their employers. A prime example are laws that protect people from dismissal because they have filed discrimination lawsuits. Other employee actions that may be protected include filing for workers compensation and reporting employers to an official whistle-blowing program. An employer does not have the liberty to dismiss individuals on this basis because it is considered retaliation. Furthermore, if an employer is involved in criminal activity or if he plans to be, he generally cannot fire employees who do not want to participate.
The ability to dismiss at will is further reduced by a legal requirement that businesses uphold their words. A business may be prosecuted for unlawful dismissal if it ends an employment relationship without following its stated procedure. If there is a company policy that states a person will receive two written warnings before dismissal, the company generally loses its ability to immediately terminate a person.
Unlawful dismissal cases have an ability to negatively affect a company in at least two major ways. First, if found guilty, a company may be required to pay out a substantial amount of money. A portion of it could be awarded as damages for the victim, and the other portion may be for fines. Second, some cases incite a torrent of public backlash that can severely damage a company's stature.