What Is Wrongful Dismissal vs Unfair Dismissal?

What is Wrongful Dismissal?

Wrongful dismissal is a breach of contract claim, not based on statutory rights. It happens when your employer terminates your employment without following the terms of your employment contract. For instance, if your contract requires one month’s notice but you are dismissed immediately without pay in lieu of notice, that is wrongful dismissal.

Under UK common law, employers must adhere to contractual notice periods or disciplinary procedures outlined in the contract or handbook. Failure to do so allows you to claim damages equivalent to what you would have earned during the notice period, minus any mitigation like new earnings.

Note that tribunals have a £25,000 limit for wrongful dismissal claims, so larger claims go to civil courts.

• Wrongful: Common law, no service needed
• Unfair: Statutory (ERA 1996), usually 2 years service
• Wrongful: Notice pay/damages
• Unfair: Basic + compensatory awards

What is Unfair Dismissal?

Unfair dismissal arises under Part X of the Employment Rights Act 1996. To claim, you generally need two years’ continuous service, though exceptions exist for automatic unfair reasons like discrimination or whistleblowing.

Your employer must show a fair reason for dismissal—such as conduct, capability, redundancy, or some other substantial reason—and that they acted reasonably in treating that as sufficient grounds. Tribunals assess if the procedure was fair, often guided by the ACAS Code of Practice.

Unlike wrongful dismissal, unfair dismissal considers the overall fairness, not just contract breach.

Key Differences: Wrongful vs Unfair Dismissal

• Wrongful: Common law, no service needed
• Unfair: Statutory (ERA 1996), usually 2 years service
• Wrongful: Notice pay/damages
• Unfair: Basic + compensatory awards

1. Contract breach vs statutory rights
2. Qualifying period: None vs 2 years
3. Remedies: Notice pay only vs basic award + compensatory
4. Tribunal vs civil court caps

Common Examples of Wrongful and Unfair Dismissal

• Wrongful: Sacked on the spot without notice
• Wrongful: Ignoring contractual disciplinary steps
• Unfair: Redundancy without fair selection
• Unfair: Dismissal for pregnancy (automatic unfair)

A classic wrongful dismissal example is summary dismissal without pay for alleged gross misconduct when the contract requires investigation. You could claim full notice pay as contract breach.

For unfair dismissal, imagine being sacked for poor performance without warnings or capability process—that breaches statutory rights to fair procedure.

Another wrongful case: no payment for accrued holiday pay on termination, a contractual entitlement.

Time Limits and How to Make a Claim

1. Contact ACAS for Early Conciliation
2. Receive certificate
3. Submit ET1 form to tribunal within time limit
4. Gather contract, payslips, dismissal letter

For unfair dismissal, submit to ACAS Early Conciliation within 3 months less one day of dismissal; the process pauses the clock. Then file tribunal claim.

Wrongful dismissal in tribunal also needs ACAS first, same time limit, but court claims have 6 years.

Always notify ACAS promptly to avoid time bar.

Tribunals handle both up to £25k for wrongful; exceed that, go to county court.

For more on Discover your rights unfair dismissal UK, see here.

For more on Discover unfair dismissal time limits the three-month rule explained 2, see here.

For more on Discover what constructive dismissal means in UK employment law, see here.

Remedies and Compensation Available

In wrongful dismissal, compensation is damages for breach, typically notice pay or salary for the notice period, capped at £25k in tribunal.

Unfair dismissal remedies include basic award (like redundancy: age/service-based, up to £19,290), compensatory (losses up to £115,115 or 52 weeks’ pay), and orders for reinstatement or re-engagement.

Dismissal pay combines these; unfair often yields more overall.

Polkey reduction may apply if procedure fault but dismissal inevitable.

Can You Claim Both Wrongful and Unfair Dismissal?

You can claim both wrongful dismissal vs unfair dismissal together in one tribunal claim. The wrongful element becomes part of the unfair remedy calculation.

Tribunals award contract breaches within unfair claims, avoiding double recovery.

This maximises dismissal pay potential.

Wrapping Up: Wrongful Dismissal vs Unfair Dismissal

Wrongful dismissal vs unfair dismissal both protect UK workers, but target different issues: contract breach versus statutory rights failures. Choose based on your situation for best outcomes.

Review your contract, dismissal letter, and timeline now. Early ACAS contact is essential.

Empowered with this knowledge, you can pursue rightful compensation confidently.