When Is It Acceptable for You to Dismiss an Employee?

Man leaving the office after being fired depositedhar / Deposit Photos

Disclaimer: The information provided in this article does not, and is not intended to, constitute legal advice; instead, all information, content, and materials are for general informational purposes only.

In the reality television series The Apprentice, those hapless candidates who fail to meet the standards set by Sir Alan Sugar / Donald Trump (delete as appropriate) each week promptly find themselves "fired".

While these dismissals are primarily for the sake of entertainment, though, they can reflect the sometimes brutal reality of the corporate business world.

With that in mind, it's inevitable that at some point on your entrepreneurial journey, you will have to terminate someone's employment. However, unlike Messrs Sugar and Trump, this doesn't mean simply pointing a finger and uttering the famous words; in the litigation-heavy world of modern employment, you need to have solid reasons for dismissing an employee.

What Are the Grounds for Firing an Employee?

Employment laws and regulations differ by jurisdiction and, in some cases, even by company, but generally, the circumstances leading to termination are similar. This works both ways, too, of course; for example, your company cannot dismiss employees based on gender, age, sexual orientation, or race. 

Therefore, it's important to know on what terms you can legally dismiss an employee. Wrongful termination can cost you financially in terms of lawsuits and tribunals, while it can also hurt your company's reputation, as well as the morale and productivity of your other employees. To avoid such situations, here are the grounds on which you can safely say: "you're fired".

1. Unethical Behaviour

If you have proof that an employee's behaviour has gone against your company's ethics, then you are within your rights to dismiss them. According to CareerAddict, unethical behaviour can be defined as including "dishonesty, fraud, slander and theft", while other examples can consist of violence, threats or sexual harassment towards other employees. Displaying a lack of professional ethics, particularly in roles that require licensing (such as accounting, finance or medicine) is also a sackable offence.

Of course, you will need documented proof in any of these instances before you pull the trigger; if you have an HR department, they almost certainly need to be involved in any review process, too. Speculation alone about somebody's actions are not grounds for dismissal, and in such cases, it's wise to suspend the employee in question while a fair and open investigation can be conducted.

Once you know for sure that an offence has been committed, then you should act quickly. Employees who display such behaviour are toxic for your company, and failure to act on such cases reflects poorly on your management. Don't let someone who does not have your company's best interest in mind ruin your image or hard work, nor the morale of your other employees. Terminate their employment immediately before any further damage is done.

2. Incompetence

Your employee might have done very well in the interview; they may have said all the right things and proven that they have what it takes to achieve the tasks set for them. However, when push comes to shove, it might become evident that they do not measure up.

If, in such an instance, you have undertaken the following actions:

  • Trained the employee in question
  • Taken the time to mentor them
  • Given them constructive feedback on their performance
  • Allowed them the opportunity to grow within the company
  • Encouraged them to adapt to the culture

...and they are still not able to perform the essential requirements of the job, then, unfortunately, you are going to have to act – especially if it is clear that the person in question has "embellished" their abilities to secure the role.

There is only so much time, effort and resources you can commit to one individual, and if it is affecting productivity and your company's ability to function effectively, then you need to put the needs of the wider business first. 

3. Insubordination

If an employee refuses to follow orders, then the company has every right to terminate this employee. Refusal to complete a given task can result in work not being completed, customers being inconvenienced and, most likely, create the necessity for other employees to pick up the slack. This will create a disruptive – and, potentially, toxic – work environment.

Two things are important here, though. Firstly, the task itself must be reasonable in nature; asking an employee to do something unethical or beyond the scope of their skill set is not grounds for dismissal. Secondly, you need to be clear in your definition of insubordination. If you have created a culture in which you discard hierarchy, for example, then an employee refusing to perform a task because they think it's not in the company's interests is different to somebody rebuffing your request out of laziness or malice.

4. Constant Absence or Lateness

Although it is only human to be sick, it's an undeniable reality that some employees take advantage in this regard. Similarly, if an employee is consistently late for work or takes unpaid leave regularly, then it is clear that they are not committed to your company.

If you begin to notice this kind of behaviour in a particular employee, then it is vital that you start keeping detailed records, should it reach the point where a dismissal is a viable option.

Be aware that this is a tricky area, too. If your employee has a genuinely serious illness or condition, then this is not grounds for dismissal (far from it, in fact). However, in many jurisdictions, it is a legal grey area over whether or not an employee has to disclose any medical conditions to their employer (provided it does not directly affect their own safety or the safety of others). The best course of action is to hold a meeting with your employee and raise the issue of their continual absence, which can hopefully lead to a positive resolution for both parties.

5. A Poor Culture Fit

In the modern workplace, a company's culture is hugely important. It defines how the company operates, and on a day-to-day level, embracing it is what makes your team "click"; for employees to fit into your company culture, they must understand its goals and its vision.

Therefore, when they don't, it can become an issue. An employee may have excellent skills and lots of experience, but if they do not fit into the company's culture, they will stick out. It will be hard for them to work with other colleagues, and they will struggle to identify with your company's goals. Also, if an employee does not show commitment to the company's methods and vision, then they are not an asset.

Generally, in instances where this is the case, it's a two-way street; you might find that the employee in question prefers to resign first, or will not fight against their dismissal. This doesn't mean that the worker in question is necessarily bad at their job – you can still give them a great reference; it just means that on this occasion, it wasn't meant to be, and parting ways is the best resolution for all concerned.

6. A False CV 

This one goes without saying: if an employee has lied to get the job, then they cannot be trusted.

Before you issue your marching orders, though, you need to be flexible with your judgement. If somebody has taken artistic liberties with their responsibilities in a previous role, then you might be willing to overlook this; provided it's nothing too drastic, you might even commend their ambition. However, if you find that the employee in question has outright lied – especially about something serious, such as a qualification, or something that could compromise safety or reputation – then you should dismiss them immediately.

Always do your due diligence on any potential hires and gain thorough references, and if it becomes apparent early on that someone is out of their depth, take action on it.


Nobody wants to terminate somebody's employment and take their income away from them, but, as discussed above, there are certain occasions where you will have no other choice. This doesn't necessarily apply to underperforming employees, whom you should make every attempt to help before escalating things so far; rather, it refers to situations that are beyond repair.

It also highlights the importance of providing your employees with an in-depth, professionally written employment contract when they start working for your company. This contract should carefully and explicitly state any grounds on which their termination will be considered, providing your employees with a clear idea of what is acceptable and what is not, as well as giving you a strong legal leg to stand on should the worst come to the worst.

Are there any other reasons you can think of for firing an employee? Let us know in the comment section below.