• On 8 July 2021 we partnered with Mid Kent CIPD to deliver a webinar for HR professionals on the subject of demystifying ‘some other substantial reason’, commonly referred to as SOSR.

    In this article, we summarise the top line guidance for employers that we covered in the session.

    For more detailed information on this issue, the webinar recording and slides are now available to view.

    What is SOSR and when might it apply?

    • A dismissal may be fair if you as an employer can show that it is for a reason falling within one of the five fair reasons set out in the Employment Rights Act 1996. Section 98(1)(b) states:
      • “For some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held.”
    • There is no statutory definition for what SOSR is. However, relevant authorities have made clear that the reason relied upon, must:
      • Be substantial, that is not frivolous or insignificant, which will depend upon the facts and type of each case.
      • Be of a kind that justifies dismissal, rather than a lessor sanction of an employee holding the job they actually held.
    • Provided the above is met, almost any reason that does not fit into the other potentially fair reasons, could be SOSR.

    What is the two-stage test?

    In the context of SOSR when a tribunal considers whether the dismissal was fair or not, they will follow the two-stage test.

    • As an employer, you must show that the SOSR is the sole or principal reason for dismissal. The burden of proof is on you to show the reason was one that could justify dismissal, it does not have to show that it did justify dismissal.
    • You must show the decision to dismiss the employee for the SOSR was reasonable in all circumstances. This includes the size and administrative resources available to the business. The burden of proof here is neutral and it is for the employment tribunal to investigate reasonableness.

    Is there a specific procedure that must be followed?

    • To succeed in arguing a claim of unfair dismissal, not only must you have a potentially fair reason for dismissal, but you must also follow a fair procedure.
    • There is no specific statutory procedure or guidance.
    • It is arguable that the Acas Code of Practice does not apply to an SOSR dismissal, although depending upon the issues, it could. We recommend that following the Acas Code is therefore the safest route.
    • A fair process is likely to include at least:
      1. Inviting your employee in writing to a meeting
      2. Allowing the employee to be accompanied at the meeting
      3. Meeting and consulting with the employee
      4. Considering alternatives to dismissal such as other vacancies/jobs. However, remember that you do not have to invent or create a job for them
      5. Confirming the decision in writing
      6. Giving the right of appeal

    When might a formal procedure not be appropriate?

    It is rare for an employer to be found to have acted procedurally fairly if they haven’t undertaken any formal procedure before deciding to dismiss an employee.

    However, case law has seen such rare cases. This was confirmed in the recent case of Gallacher v Abellio Scotrail (UKEATS/0027/19). In this case, there was an irretrievable breakdown of the relationship between the claimant and her line manager following periods of sickness, issues overpay and on-call work. This resulted in a performance review as which the claimant was dismissed, with no warnings and no procedure or right of appeal. The claimant claimed unfair dismissal.

    The facts showed that there would have been nothing useful to be gained by holding formal meetings or an appeal before deciding to dismiss. The employment tribunal (in a decision upheld by the EAT) found that the dismissal was not unfair.

    This was despite the fact that the employer undertook no formal procedure. The conclusion was reached in the context of findings that a dismissal procedure would in fact have ‘worsened’ the situation, considering that:

    • This was a case involving two senior managers who needed to be able work together effectively in order to deliver what the business required at a critical juncture.
    • Neither had trust and confidence in the other.
    • The claimant was not interested in retrieving the relationship with her manager.

    Key reasons and points to consider

    The case law surrounding SOSR dismissals highlights that the reason for the dismissal must be substantial, but it does not necessarily need to be particularly complex. Remember that the key is that the reason for the dismissal must be genuine.

    Some of the most common examples of SOSR (and the principles that have emerged from the courts and tribunals over time) include the following.

    Business reorganisation

    Where a restructure does not give rise to an actual redundancy situation. For SOSR to be valid, you must have a genuine and sound business reason for any changes. The reason cannot be too vague, and you will be expected to provide evidence of your business reasons to a tribunal. You would also be expected to follow a fair process and consider whether consultation with employees is appropriate.

    Personality clashes

    Personality clashes which lead to substantial disruption to a business can potentially amount to a fair dismissal for SOSR. Bear in mind that a tribunal will expect you to take steps to resolve the issue before contemplating dismissal. This could include a move to an alternative position, or mediation.

    The expiry of a limited-term contract

    This will amount to a dismissal in law. In this instance, you may rely on SOSR as the reason for dismissal in cases where the employee’s role is not redundant. For example, if a fixed-term contract is used to cover the absence of a permanent employee. A tribunal will look at whether your employee was made aware that they were employed for a temporary period or for a particular job, and will make sure that the expiry of the contract is genuinely the reason for the dismissal.

    Reputational risk

    This can give rise to a valid SOSR reason, if, for example, an employee has been accused or convicted of a criminal offence that could damage your reputation or business. Whether or not dismissal is reasonable will depend on the nature and size of your business. It will also depend on the seriousness of the offence. Your employee must be allowed the chance to defend themselves and you will be expected to consider if there are any alternatives to dismissal.

    Third party pressure

    External pressure to dismiss, for example from a customer or supplier, can justify a dismissal for SOSR in some circumstances. Case law has established that the importance of the third parties’ continued business to the employer will be relevant. As will the seriousness of the threat from the third party. In this instance, you should consider any injustice to your employee and make efforts to persuade the third party against the dismissal.

    Protection from competition

    This can a justify a dismissal for SOSR, where an employee acts in such a way that doesn’t quite amount to a breach of an express or implied duty, but otherwise creates a possible conflict with your business interests. A tribunal would expect you to have evidence to support your position and to demonstrate that there would be a realistic commercial risk if your employee was to remain in the business.

    Further support

    For more in-depth guidance or support on the issues covered in this article, book a free 30-minute consultation with our Employment team today.

    This content is correct at time of publication

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