Accelerator: People - The gentle art of letting people go

The days when you could slap a P45 into the hand of an offending employee are long gone. You must adhere to strict procedures when dismissing someone, or risk a summons to appear before an employment tribunal. Alexander Garrett helps you through a legal maze.

It's the letter every small-business owner dreads: a notice to appear at an employment tribunal informing you that one of your ex-employees has made a claim for unfair dismissal. The case itself is likely to prove stressful and to cost valuable management time; lose it and you could be forced to pay compensation of up to £60,000.

If you own a business, you have to hire people; and if you hire them, then from time to time you're going to have to fire them. Few entrepreneurs approach the task with relish, and many choose to use a more euphemistic description such as 'letting him/her go'; but you can't shirk it, and nor can you afford to get it wrong. Effective firing, in other words, can be as important to a small business as it is to an infantry platoon.

To begin with, sacking somebody can be just as stressful for the person doing the firing as it is for the person being fired. A survey of 200 managers for interim management firm Alexander Hughes last year found that four out of 10 who had had to dismiss somebody felt their health and family life had suffered as a result. One in eight said that the stress had affected their work. Almost 40% said that they enjoyed their work less as a result; and, tellingly, 71% said they would be upset if they were expected to take the lead in making people redundant. For small-business owners, the decision to dismiss someone - or to make them redundant - is usually one they have to make themselves.

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