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Constructive Dismissal

Constructive dismissal (sometimes called constructive unfair dismissal) is when an employee feels forced to resign because of the actions of their employer.

If an employee is considering making a constructive dismissal claim at an Employment Tribunal they should be aware that it can be a difficult claim to win and independent legal advice should be sought before making the decision to resign.

Actions that could amount to constructive dismissal

An employer acting unfairly or unreasonably would generally not be seen to be constructive dismissal. Only in the most serious of cases could the actions of the employer amount to constructive dismissal.

Situations that could lead an employee to feeling they have been constructively dismissed could include:

  • Being suddenly demoted for no reason.
  • Being bullied or discriminated against by either the employer or colleagues.
  • Changing hours or place of work without agreement and without the contractual right to do so.
  • Raising a grievance which the employer refuses to look into.
  • Being given an excessive workload.
  • Consistently being paid incorrectly.

Seek advice and support

If an employee is considering whether to leave employment due to the actions of their employer, they should consider seeking independent legal advice before resigning. Resignation is a big step, and constructive dismissal can be a difficult claim to win. A solicitor can advise whether they felt the employee had been constructively dismissed, enabling the employee to make a more informed decision. 

Try to resolve the matter with the employer

If an employee is concerned with a situation at work they should first consider raising the issue with their employer informally. Some issues can be resolved quickly through a conversation with a line manager or other appropriate person within the business.

If an informal approach does not work an employee has the option of raising a formal complaint (also known as a grievance). This should be done in writing and would make the employer aware of how strongly the employee feels about the situation, while also giving the employer the opportunity to resolve it, initially by inviting the employee to a formal meeting to discuss their concerns.

If an employee has not made genuine efforts to resolve their concern with their employer before resigning, this can make it more difficult at a later stage to claim that the employee has been constructively dismissed by the employer.

Working under protest

If an employer changes the terms of an employee's contract without agreement, an employee attempting to resolve the matter with their employer could work under protest. This would involve the employee continuing to work for their employer while making it clear in writing that they do not agree with the situation. This should be done on a regular basis, for example weekly or on each payday.

This cannot go on indefinitely however, and the longer an employee continues to work under the new terms, the more likely it may be seen that the situation has been accepted, which could impact on any legal claim an employee is considering bringing.

Ending the employment relationship if matters are not resolved

If both employer and employee feel that the situation cannot be resolved and the working relationship cannot continue then it may be possible to agree to end the employment relationship in a mutually acceptable way. For more information please see Settlement agreements.

Otherwise, the employee can end the employment relationship by handing in their resignation. The employee should set out their reasons for leaving clearly in a resignation letter.

Notice periods when resigning from a role

In usual circumstances resignations require giving and then working a notice period. Resigning with immediate effect will usually mean that the employee is in breach of their employment contract. However, in some cases, if the employer has seriously breached the employment contract, resigning without working notice can be justified.

If an employee claims constructive dismissal after working their notice period, the employer may say that the situation cannot have been as bad as claimed as the employee continued to work. It is therefore advisable for an employee to seek independent advice before resigning with an intention to claim constructive dismissal.

Options to take the matter further

An employee usually needs two years continuous service with their employer in order to pursue a constructive dismissal claim against them.

For most tribunal claims there is a three-month time limit for an employee to submit a claim. However this time limit may be paused if Early Conciliation is taking place. Early Conciliation is the first step in making a claim to an Employment Tribunal and provides an opportunity for the situation to be resolved without the need to go to court.

If the case progressed to an Employment Tribunal hearing, an employee would need to prove that the reason for the resignation was that the actions of their employer were so serious that the employee had no choice but to resign.

For more information, go to Employment Tribunals.