What Is Constructive Dismissal

If you resign because your employer has committed a serious breach of your employment contract, the law treats you as having been dismissed (“constructive dismissal”) even though you brought your employment to an end.

What is considered to be a sufficiently serious breach of my employment contract? Questions of constructive dismissal will arise where your employer’s actions were such as to destroy your trust and confidence in him/her as an employer. In most cases there will be what is technically called a “breach of the implied term of trust and confidence.” It is possible to rely on a whole series of actions extending over a considerable period of time. In such a case, the law looks at the whole course of the employers conduct and asks if taken together it is sufficiently serious. The final act – “the last straw” may be something trivial provided it causes the you to resign. There is no definitive list of what could amount to such a breach, but the following are good examples:

  • Failing to consider promptly or adequately a grievance you have submitted;
  • Harassment and/or victimisation;
  • Changing your job description and/or demoting you, changing your pay or changing your hours significantly without first consulting you and getting your agreement;
  • Demoting you or suspending you for no reason;
  • Moving your job some significant distance from its current base without first consulting you;
  • Falsely accusing you of misconduct or incompetence;
  • Humiliating you in front of your colleagues;
  • Failing to provide you with a working environment which is suitable for fulfilling your role; and
  • Failing to support you as the manager when there are well-known operational difficulties.

What conditions do I have to fulfil?  You will normally have to be employed for two years before you can bring a claim for constructive dismissal (some of the exceptions to this rule are set out below). In any case, you should consider very carefully and take expert advice before resigning in response to your employer’s behaviour. If you do resign, the tribunal will first consider whether your employer committed a sufficiently serious breach of your employment contract. If it is found that there was no such breach, you cannot claim constructive dismissal and your claim fails. And you will have no job. If the breach is deemed sufficiently serious , there will be a constructive dismissal. Such a dismissal will almost always be unfair. If the reason why the employer acted in this way was your age, race, sex or some other prohibited reason, the dismissal will be discriminatory. If the reason was that you had made a protected disclosure, the dismissal will be a “whistle-blowing dismissal” (seeour page on whistleblowing for more information). If that is the case you will be able to recover compensation above the normal limits for unfair dismissal; and you will not need two years continuous employment before you can bring a claim.  So I want to resign because my employer has breached my employment contract – what should I do? First of all, you must decide quickly whether you want to resign. If you do not resign within a reasonable amount of time of the breach, then you are taken to have waived the breach and can no longer claim constructive dismissal. What is reasonable will depend on the circumstances – but acting as soon as possible is advisable so that your employer cannot argue you waived the breach. Secondly, you must decide whether you want to resign immediately or by giving the notice due under your contract of employment. There are pros and cons of either course of action. If you resign on notice you remain an employee till the end of the notice period and have all the obligations of an employee, but you continue to be paid. Thirdly, you must communicate to your employer in writing your decision to resign. You should take professional advice on what to say in your letter since if you do bring a Tribunal case, your letter will be a very important document. Are there any time limits? Yes, you must bring your claim within three months of the date your contract of employment was terminated, that is to say the date of your resignation.

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