Running a small business means making tough decisions and sometimes, that includes ending someone’s employment. When that happens, you need to make sure your reasons (and your process) are fair and legally sound.
Most employers are familiar with dismissals for conduct, capability, or redundancy, but there’s another, often misunderstood, category under UK employment law: “Some Other Substantial Reason” (SOSR).
At Beagle HR, we often get calls from business owners who’ve found themselves in tricky situations that don’t fit neatly into the standard boxes. SOSR is there to cover those scenarios but it must still be handled carefully.
What Does “Some Other Substantial Reason” Mean?
Under Section 98 of the Employment Rights Act 1996, there are five potentially fair reasons for dismissal:
- Capability
- Conduct
- Redundancy
- Statutory restriction (where employing someone would break the law)
- Some Other Substantial Reason (SOSR)
That last one, SOSR, is essentially a “safety net”. It covers legitimate business reasons for dismissal that don’t fall under the usual categories but are still substantial enough to justify ending employment.
To understand each of these in more detail, read our guide on the five fair reasons for dismissal
When Does SOSR Apply?
Here are some real-world examples of how small businesses might use SOSR fairly:
- Fixed-term cover ending: You hired someone to cover maternity leave, and the original employee returns.
- Contractual changes: You need to update terms and conditions (for example, shift patterns or pay structure), and an employee refuses to agree despite reasonable consultation.
- Personality clashes: Two key team members can no longer work together, and it’s damaging morale or performance across the business.
- Safeguarding concerns: You have serious concerns about an employee’s suitability to work with vulnerable people, but not enough evidence for a misconduct dismissal.
These are all examples where a dismissal could be fair under SOSR if managed properly.
If relationship issues or refusal to accept new terms are becoming a problem, check out our advice on managing workplace conflict effectively and how to conduct a fair dismissal meeting.
The Golden Rule: Process Matters
Even when there’s a strong business reason, the process you follow is just as important as the reason itself.
Before you move to dismissal, you should:
✅ Investigate the issue thoroughly.
✅ Consult with the employee and give them the chance to respond.
✅ Consider alternatives (like redeployment or mediation).
✅ Document everything the reason, the steps taken, and your decision-making process.
If you skip these steps, you risk an unfair dismissal claim, even if your reason falls under SOSR.
Why This Matters for Small Businesses
For SMEs, every team member counts and so does every decision. The cost of getting it wrong can be significant: legal fees, tribunal claims, and reputational damage.
SOSR dismissals are often the grey areas of employment law, but with the right guidance, they don’t have to be.
At Beagle HR, we help business owners navigate these complex situations with confidence from reviewing your contracts and policies to guiding you step by step through a fair process.
Key Takeaway
Dismissal for “some other substantial reason” gives small business owners flexibility when standard dismissal categories don’t apply but that flexibility comes with responsibility. Always ensure your reason is genuinely substantial, your process is fair, and your documentation is clear.If you’re facing a situation that might fall under SOSR, don’t go it alone.
👉 Speak to Beagle HR today for straightforward, practical advice before taking action.
