I don't want to be sued by my employees? How can I avoid this?

I don't want to be sued by my employees? How can I avoid this?

Workplace disputes can be a nightmare for small business owners. 😰 They’re emotionally draining, time consuming, and can cost the earth.

But, by being a responsible employer, and having the right contracts and policies in place – you’re unlikely to ever find yourself in an employment tribunal.

In my experience, disgruntled employees aren’t motivated by money. They take things further because they feel they’ve been treated badly. But, when you’re in the throes of an emotionally charged workplace problem – being aware of what your employees could potentially sue you for, can be SOOO helpful, so you don't add fuel to the fire and do something that could damage your defence case.


If your employee reckons you’ve acted unlawfully towards them, they could start the employment tribunal ball rolling. Unlawful things include: unfair dismissal, discrimination, or unfair deductions from pay. They can usually only do this within three months of the dispute, or within three months of their employment ending.

The first thing they’ll be advised to do, is contact Acas, who’ll offer to facilitate an early conciliation, for free, and in confidence. Of course, you both need to agree to take part.

If this fails, then your employee can make a claim to an employment tribunal. This could then lead to a hearing, and potentially a compensation award 💷 for your member of staff.


  • In 2018/19 there were 121,111 employment tribunal claimants. This is 10% more than the previous year, and a whopping 37% more than the year before that! Of course, not all claims get to an employment tribunal. For example, a claim that’s missed the deadline will be kicked out.
  • In the same year, there were a massive 774 claims that received financial compensation for unfair dismissal and discrimination.

By the way, these numbers are from GOV.UK tribunal statistics.


The number of employment tribunal claims has been totally affected by historical changes in the law.  Let me explain…

In 2013, tribunal fees for claimants were introduced – apparently to discourage weak cases from getting through the system. This put thousands of employees off making a claim. However, in 2017, the Supreme Court said this was wrong and the fees were scrapped. This then led to an increase in claims.

In my experience, legal advisers sometimes encourage employees to make a claim for more than one reason – to stand a better chance of winning a case. In 2016/17, 81% of the employment tribunal cases were multiple claims. I talk about this in my book Hiring your First Employee.


1. Breaches of contract 📄

A breach of contract is where terms in an employment contract have been broken – either by you – or your employee. For example: not coughing up for travel expenses; changing somebody’s job without asking; or unlawfully lowering pay.

Your employee can only make claim to an employment tribunal if they don’t work for you anymore. And, they must do it within three months of their employment ending. The maximum compensation award they can get for a breach of contract is £25,000.

If your employee still works for you, they could go to a normal court with their complaint. There, they’d have up to six years to make a claim and could get more than £25,000.

My advice to prevent this from happening to you: 👇🏼👇🏼👇🏼

  • Get familiar with what’s in your employment contracts. If you’ve used an online template that contains lots of legal jargon, you might not realise what you’ve signed up to – making a breach on your side more likely.
  • It’s okay to make changes to when and how your people work, but it’s got to be done the proper way. Reach out if you need help with this. 

2. Unfair dismissal 🚪

Unfair dismissal is when you’ve sacked your employee for an unfair reason – and / or you’ve gone about it the wrong way. Your employee can usually only challenge this, if they worked for you, for longer than two years.

Sacking somebody because they’re pregnant, or because they fixed a health and safety issue is unfair. Sacking somebody because of their bad behaviour or incompetency is normally fair. But even if it’s a fair dismissal, the Employment Act 2002 means that by law, you’ve gotta follow a disciplinary process before getting rid of somebody.

According to GOV.UK tribunal statistics – in 2018/19 – 660 claims for unfair dismissal were awarded with an average of £13,704 in compensation. Ouch!

My advice to prevent this from happening to you: 👇🏼👇🏼👇🏼

  • Make sure all your HR essentials are in place e.g. employment contracts and policies that say what your disciplinary and grievance procedures are. And what’s more, stick by them! If you don't have them, check out my DIY HR Toolkits. 
  • Before you even consider sacking someone, follow the Acas Code of Practice to protect yourself.


As the boss, I’m afraid you’re responsible for any discrimination that happens on your watch – either by you, or by your staff.

Discrimination is when you treat someone differently because of their gender, religion, age, sex, familial status, or disability. You could do this intentionally or unintentionally – and either directly or indirectly. Be warned ⚠️ you can also be accused of discrimination while you’re recruiting. Not just by a member of your existing staff.

GOV.UK tribunal statistics show that in 2018/19, there were 114 discrimination claims that were given compensation for: race, sex, disability, religion, sexual orientation, and age discrimination. The largest ever UK award for sex discrimination amounted to a whopping £1,762,130 in 2015/16. Oh, and there’s no cap on the compensation for discrimination claims.

My advice to prevent this from happening to you: 👇🏼👇🏼👇🏼

  • Make sure you have the right policies in place (e.g. Equality, Anti-Bullying). And that your employees know about them!
  • Tell your team you take a zero-tolerance approach to discrimination 🚫To set the right example, personally clamp down on any anti-discriminatory behaviours in your workplace.


Because you’ve:

  • Not given them a written statement of employment particulars or a contract
  • Not allowed, or not paid for, statutory holiday entitlement
  • Not paid the minimum wage
  • Paid an employee more than somebody else doing the same job
  • Worked your staff so hard, they’ve not had the breaks they’re entitled to
  • Stopped them from bringing a colleague or trade union rep to a disciplinary or grievance hearing.

Download my FREE Guide so you can better protect your biz in just 5 mins.


  • Book a free consultation with Mandy here, to learn more about us working together.

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