Most employers are familiar with the notion that, save for some statutory exceptions to the two year service rule in order to obtain unfair dismissal rights (e.g. any form of discrimination and other exceptions), in theory employees can be dismissed with impunity (i.e. for an unfair reason) provided notice of termination is given before an employee has attained 1 year 11 months and 3 weeks service. This is because where no notice is given (or a payment in lieu of notice is given) s.97 Employment Rights Act 1996 (“ERA”) kicks-in and automatically adds an extra one weeks’ notice (provided for by a deeming provision under s.86(1) ERA).  So unless an employer’s timing is perfect, the extra one weeks’ notice can take an employee just over the two years service threshold, thereby creating an entitlement to bring an unfair dismissal claim. The Tribunal The Tribunal found as a matter of construction that s.86(1) ERA applied. Therefore, as W was just two days short of two years continuous service the extra one weeks’ notice meant W had the right to claim she had been unfairly dismissed. The Tribunal went on to find the dismissal had been substantively unfair. The Employment Appeal Tribunal (“EAT”) The Employer argued that the s.86(1) deeming provision was subject to its right to give no notice in circumstances allowed for by s.86(6) ERA. s.86(6) ERA says …"This section does not affect any right of either party to a contract of employment to treat the contract as terminable without notice by reason of conduct of the other party.” The EAT held that provided an employer could establish it had grounds to summarily dismiss without notice (e.g. gross misconduct) then the s.86(6) deeming provision trumped s.86(1) with the result that notice would not automatically be extended by one week. Conclusion It’s clearly not a great idea to allow an employee whom an employer wishes to dismiss with less than two years service to still be employed within a week of attaining two years continuous service, and then hope to rely on a gross misconduct dismissal in order to avoid an unfair dismissal claim. In those circumstances unless the repudiatory breach is so obvious, a lot of employees may try their luck in a Tribunal as W did. On a separate point this decision also made clear that a Tribunal can consider making a “Polkey” reduction in compensation even where the dismissal has been substantively unfair. In other words, any potential reduction is not just limited to procedurally unfair dismissals.