It has long been established that an employee needs 2 years’ service to claim normal unfair dismissal under the Employment rights Act 1996.

That protection actually applies a statutory week below the 2 years in most cases, because the Courts have held that in effect the statutory minimum notice of termination should be taken off the 2 year qualification requirement.

In a recent case Lancaster and Duke v Wileman the Employment Appeal Tribunal has confirmed that this reduction of the 2 year period by the statutory notice does not apply when an employee is dismissed for gross misconduct just short of the qualifying period for unfair dismissal.


In this case the Claimant had been dismissed 2 days before her 2 year anniversary. She claimed unfair dismissal by applying the above rule that the statutory minimum notice of 1 week would have taken her “over the line” of the 2 year rule.

The Respondent employer argued that by virtue of Section 86(6) of the Employment Rights Act 1996 the employer was still entitled to dismiss, without the statutory notice being added, where the Claimant employee was guilty of (alleged) gross misconduct.

The EAT reconfirmed (in a case to be welcomed by employers) that if the Respondent had been entitled to dismiss without notice (i.e. for gross misconduct) then no statutory notice could be added and therefore the employee could not claim normal unfair dismissal.

The case was remitted back to the Tribunal to consider whether, in fact, the employee had committed an act of gross misconduct. If they had, then there would be no unfair dismissal, if they hadn’t, then the statutory one week reduction would apply so the Claimant would be able to claim unfair dismissal.

Employers in the motor industry are advised to take particular care where dismissals are approaching the 2 year rule and RMIF members are reminded that they can seek advice from the RMIF legal helpline in such situations.

Motor Industry Legal Services

Motor Industry Legal Services (MILS Solicitors) provides fully comprehensive legal advice and representation to UK motor retailers for one annual fee. It is the only law firm in the UK which specialises in motor law and motor trade law. MILS currently advises over 1,000 individual businesses within the sector as well as the Retail Motor Industry Federation (RMI) and its members.