Mental health and dismissal: What UK employers need to know

Dismissing someone whose mental health is affecting their work is one of the most difficult decisions an employer can face, and one of the easiest to get legally wrong. It is possible to do it fairly through a proper process, genuine consideration of alternatives, and an understanding of where discrimination law sits alongside unfair dismissal law.

CIPD's Health and Wellbeing at Work research found mental ill health is the leading cause of long-term absence, cited by 41% of employers, and the second most common cause of short-term absence at 29%. Plus, average absences now stands at 9.4 days per employee per year, the highest in over 15 years.

With this in mind, the following guide covers when dismissal can be fair, what the law requires before you get there, what is changing in January 2027, and how to reduce the chances of ever reaching that point.

Can you dismiss someone because of their mental health?

In principle yes, but rarely, and never quickly.

Mental ill health can amount to a capability issue, and capability is one of the potentially fair reasons for dismissal. But two things sit on top of that. The dismissal must be fair in all the circumstances, and if the condition is a disability, the Equality Act 2010 applies as well. Acas puts it simply in its guidance on following a fair procedure: for long-term illness, "dismissal should be a last resort", and "dismissing someone because they have a disability could be discrimination".

The practical risk for employers is not usually the decision itself. It is the process that led to it.

When mental ill health is a disability

Under section 6 of the Equality Act 2010, a person is disabled if they have a physical or mental impairment with a substantial and long-term adverse effect on their ability to carry out normal day-to-day activities. Long-term generally means it has lasted or is likely to last at least 12 months.

The point employers most often miss is this. Acas states that poor mental health "could be considered to be a disability under discrimination law, even if someone does not have symptoms all the time".

If it does, you have a duty to make reasonable adjustments under section 20, and that duty is triggered when you know, or could reasonably be expected to know, that the person is disabled.

What changes on 1 January 2027?

The Employment Rights Act 2025 reduces the qualifying period for ordinary unfair dismissal from two years to six months. Section 25 makes that change, and it takes effect for dismissals with an effective date of termination on or after 1 January 2027.

Something that has already changed and is easier to miss: since 1 October 2026, the time limit for bringing most employment tribunal claims is six months minus one day, not three. That doubles the window in which a dismissal decision can come back to you.

How mental ill health shows up at work

Before any of this becomes a dismissal question, it usually shows up as: * A drop in productivity, or work taking much longer than it used to * Difficulty concentrating, or struggling with tasks that were previously routine * More frequent short absences, or lateness * Withdrawal from colleagues and from team conversation * Irritability, or emotional responses that seem out of proportion * Changes in sleep, appetite or appearance * Increased alcohol use

Steps to follow a fair process

1. Keep in reasonable contact

Acas advises employers to have a reasonable amount of contact with someone off sick with stress. The balance matters. No contact for three months leaves the employee isolated and leaves you without the information you need. Weekly chasing may be perceived as pressure. Agree at the outset who will be in touch, how often and by what method.

2. Get up-to-date medical evidence

You cannot assess capability on guesswork. An occupational health referral tells you what the employee can do, what adjustments would help and what the likely timescale for a return is.

Consent is central. Acas is clear that a worker does not have to agree to an occupational health assessment, and that the adviser must have the worker's permission before sharing the report with you. If you want a report from their own doctor, the Access to Medical Reports Act 1988 gives the employee the right to see it first, to ask for corrections and to refuse to share it.

3. Consider reasonable adjustments properly

This is where most capability dismissals fail. Acas lists adjustments for mental health including flexible hours, changes to responsibilities, a quieter workspace, a phased return and flexibility with absence trigger points.

That last one is worth dwelling on. Acas's guidance on disability-related absence suggests not counting some or all disability-related absence towards trigger points, or increasing the number of absences before a review is triggered. Applying a standard trigger rigidly to disability-related absence is one of the most common routes into a section 15 claim.

Note also that the employer pays for reasonable adjustments. You cannot pass the cost to the employee.

4. Look seriously at the alternatives

Before dismissal, consider whether a different role, reduced hours, a change of duties or a longer period of adjusted work would allow the person to stay. Document what you considered and why it was or was not possible. If you genuinely have no alternative role, say so and explain why, rather than leaving the question unanswered.

5. Be clear, and allow an appeal

If you do reach a decision, Acas advises telling the employee why, when their employment ends and that they have a right of appeal, and confirming it in writing. One technical point that is frequently stated incorrectly. The Acas Code of Practice on disciplinary and grievance procedures is aimed at misconduct and poor performance. The Employment Appeal Tribunal has held that it does not apply to dismissals for genuine incapability through ill health, which means the 25% compensation uplift for failing to follow it is not available on that basis. That is not a reason to be casual. The dismissal still has to be fair under section 98(4), and following a clear, documented procedure is how you demonstrate that. Where there is a conduct element, such as abuse of the sickness scheme, the Code does apply.

How Wisdom Wellbeing can help

The point at which an employer starts thinking about dismissal is almost always months after the point at which something could have been done. Most of the value we add sits in that earlier window. Our Employee Assistance Programme gives your people confidential access to qualified counsellors around the clock, every day of the year, without a referral and without having to raise it with their manager first. For the employee who is struggling but not yet absent, that is often the difference between a difficult few months and a long-term case.

For you, the harder part is usually knowing what to do next. Capability, disability and absence questions rarely arrive neatly, and managers who are unsure tend to delay, which is exactly what makes the situation worse. Our HR and management support gives your managers somewhere to talk a situation through before they act on it: how to keep in touch with someone off sick without it feeling like pressure, when an occupational health referral is appropriate, and how to handle a trigger point where disability-related absence is involved.

Where a case is genuinely long term or complex, occupational health assessments give you the clinical view on what the person can do and what adjustments would help, which is the evidence base any fair capability process depends on. Alongside that, mental health first aid training equips the people who notice a change first with the confidence to say something about it. None of this removes the need for a careful process, but it does mean far fewer situations reach the point where one is required.

Conclusion

Dismissal on mental health grounds can be fair, but the bar is high and the process is what you will be judged on. You need a genuine capability reason, up-to-date medical evidence, real consideration of adjustments and alternatives, and a documented, consistent procedure that the employee has been part of.

Remember that unfair dismissal and disability discrimination are separate risks. You can follow a reasonable process and still face a section 15 claim if you applied an absence policy rigidly to disability-related absence. And bear the dates in mind: tribunal time limits doubled to six months in October 2026, and the unfair dismissal qualifying period drops to six months from January 2027, with the compensation cap removed at the same time.

The better investment is upstream. Managers who can spot a change and start a conversation, absence policies that flex where they need to, and confidential support people can reach without going through their line manager will prevent far more cases than any amount of careful procedure at the end.

Frequently asked questions

Is a mental health condition a disability under the Equality Act?

It can be. The test is whether the impairment has a substantial and long-term adverse effect on normal day-to-day activities. Acas confirms this can apply even where someone does not have symptoms all the time.

What is discrimination arising from disability?

Under section 15 of the Equality Act 2010, it is unfavourable treatment because of something arising from a disability, such as disability-related sickness absence, which the employer cannot justify as a proportionate means of achieving a legitimate aim.

How long do staff need to be employed to claim unfair dismissal?

Currently two years. From 1 January 2027 this reduces to six months, for dismissals with an effective date of termination on or after that date. It is not becoming a day-one right.

Can an employer force an employee to attend occupational health?

No. Acas is clear that a worker does not have to agree to an occupational health assessment, and the adviser needs their permission before sharing a report with the employer. A refusal does not stop you making a decision on the information you do have.