What is Constructive Dismissal?

Employment Law

A claim of constructive dismissal can be made where an employee (that has worked for a company for at least two years) has been forced to resign because of the actions of an employer or colleagues. The actions must amount to a fundamental breach of contract.  This doesn’t just have to be a breach of a term of the contract you can also look to the implied terms, such as trust and good faith.

One of the most common examples of constructive dismissal is where an employee loses all trust and confidence in their employer.   This usually arises over a period of time where the actions taken together amount to a fundamental breach.

If an employee believes their employer has fundamentally breached their contract either by one serious breach of contract or, a series of breaches culminating in a final straw, the employee should set out in writing clearly why they are resigning and why it’s broken down the relationship to an irretrievably level and what they are resigning in response to.  They must then resign, without delay (as delaying a resignation can weaken your case). Whilst you are not legally obliged to resign without notice, it is recommended you resign immediately to avoid counter-arguments that you have delayed and therefore the breach is not as ‘bad’ as you are making out.

When does this type of claim occur?

There are various ways in which a constructive dismissal claim may occur, some may be unaware of situations that would amount to a constructive dismissal claim, each case is taken on its merits and some may fall under the below categories and not be seen by a tribunal as enough to justify a successful claim for constructive dismissal.

Some examples may include:

  1. Consistently being paid incorrectly or an outright failure to pay agreed wages;


  1. If you are being given an excessive workload continuously with no support;


  1. If an employer refuses to deal with a grievance or mismanages a grievance to the point where it is a completely ineffective process or significant delays;


  1. If an employer changes hours or place of work without having had a consultation of any intention to do so and without a contractual right to do so, even where there is an express term in the contract to vary the hours and pay, this should be done with reasonable care and skill giving notice etc;


  1. If you are being harassed, and/ or discriminated against by either the employer or colleagues, especially when you raise this and your employer does not deal with the perpetrator and/ or you suffer as a result of making the complaint;


  1. Significantly changing an employee’s working environment to one which is detrimental to the employee’s ability to carry out their job;


  1. Suspending or excluding an employee without any justifiable reason;


  1. Suspending without pay (this should always be paid);


  1. Demoting an employee without good reason for doing so;


  1. Refusing to make reasonable adjustments making your job impossible to do without;


  1. Failure to pay an employee their commission or changing the way that commission is earned without consulting the employee first.


Employers, what to do if someone resigns and you think they may claim?

It is important that employers are careful in acting on any resignation given in the heat of the moment.

For example, if a heated discussion has taken place and an employee verbally expresses their wish to resign, employers should not take and enforce this as a solid resignation without following it up first.

Where they resign in writing you should take advice on responding and accepting the resignation but disputing the material facts of the reasons for leaving setting out why you think they have resigned instead.

They have under 3 months to issues a claim from the date of resignation. Before they can do that they must go to ACAS so you should be notified this in advance of any claim being issued.  You then have the choice to conciliate or wait for a claim to come through.  At this stage again take advice as it could save you a lot of money as the lawyer can assess the value and merits of the employees’ potential case and advise in respect of a commercial or otherwise, settlement.

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