'unfairly-dismissed' is a compound built from 'unfairly' + 'dismissed'. 'Dismiss' originates from Latin, specifically the word 'dīmittō'/'dimittere', where the prefix 'dī-' (dis-) meant 'apart' and 'mittere' meant 'to send'. 'Unfairly' is formed from the negating prefix 'un-' and 'fair' (from Old English 'fæger' via Middle English), where 'fair' developed senses including 'just'.

'dismiss' changed from Latin 'dīmittō' into Old French/Anglo-Norman forms (e.g. 'desmettre') and Middle English (e.g. 'dismissen'), eventually becoming modern English 'dismiss'. 'Unfairly' derives from Old English elements and Middle English development of 'fair' + the adverbial suffix '-ly' with the negative prefix 'un-'. The compound 'unfairly dismissed' arose from combining the adverbial modifier with the past participle to describe unjust removal from employment.

Initially, 'dismiss' meant 'to send away' (literal sending away). Over time the sense broadened to include 'to remove from office or employment' and then to contexts of termination; combining with 'unfairly' specifies that the removal was unjust or improper.