Constructive Dismissal

constructive dismissal

Constructive dismissal solicitors’ advice

Constructive unfair dismissal is where an employee resigns and makes a legal claim because of bad treatment from the employer. It is not like unfair dismissal where the employer sacks the employee.

Although not unfair dismissal, he or she asks an employment tribunal to use Section 95 of the Employment Relations Act to treat his or her resignation as if it were a dismissal. An employment law solicitor has to argue that the employee had no choice but to resign because of the employer’s conduct.

A term implied by law in every contract of employment is that both employer and employee will behave in such a way as to enable the employment relationship to work effectively – the implied term of mutual trust and confidence. Recognised by employment lawyers and employment tribunals, it though is not written into the employment contract but yet the employer’s poor conduct could lead to a loss of mutual trust and confidence.

Nonetheless, employment law solicitors would advise that resigning is a big step as far as a tribunal is concerned. The tribunal will look for evidence that the employer seriously breached the employment contract and lost mutual trust and confidence and want to be confident that the employee resigned because of that.

Grounds for constructive dismissal

Grounds for constructive dismissal could be a serious incident of poor treatment or a series of incidents. Examples could include the employer:

  • – demoting the employee
  • – refusing to pay the employee the contracted amount over a period of time without good reason
  • – removing contractual benefits, such as a company car
  • – neglecting to make the work environment safe for the employee
  • – bullying or discriminating against an employee or allowing colleagues to do so
  • – taking action against an employee based on a serious allegation made without investigation or following an appropriate procedure
  • – ignoring a grievance raised by the employer, and
  • – making unreasonable changes to working patterns.

Making unreasonable changes is a common reason for claiming constructive dismissal. An employment tribunal would view changes as a change in the employee’s employment contract. Examples include changing the hours an employee is expected to work or the location of the main workplace.

For an employment contract to be legally valid, any change made by the employer should be agreed by the employee. An employment law solicitor would advise that the only way changes can be imposed on the employee is if they are justified on business grounds. If change cannot be justified, the employee formally refuses changes and the change is imposed anyway, then this is grounds for resigning on the basis of constructive dismissal.

Constructive dismissal example

An example of a constructive dismissal case involved dental practice manager, Mrs D Rose, resigning her position at Leeds Dental Team Ltd. In 2013, an employment appeal tribunal upheld her claim.

She had been accused of not recording a nurse’s sick days. She was suspended and called to a disciplinary hearing. Her request to take a nurse to the hearing was refused. She went on sick leave and was told she would not be paid if she did not attend the hearing. She resigned and claimed constructive dismissal.

An employment tribunal judged that the employer should have investigated and issue and may have found that Mrs Rose needed training. The tribunal panel accepted that an investigation was not required in all similar situations. Yet in this case, Mrs Rose’s integrity had been questioned and she had not been given a chance to put her side of the story.

Another issue was the letter the employer used to ask Mrs Rose to a hearing. The tribunal regarded the language of the letter was disproportionate and intimidating given Mrs Rose was a good employee.

The tribunal concluded that the poor treatment of Mrs Rose amounted to a breach of trust and confidence. Trust and confidence are regarded by judges as an implied and unstated part of the employment contract. She was given a basic award of £5,000 with a compensatory award of just over £4,200.

The employment appeal dismissed Leeds Dental Team’s appeal. The tribunal regarded the issue was not whether the employee lost confidence in how he or she was treated by the employer but whether the behaviour of the employer was likely to seriously damage trust.

Constructive dismissal lawyers

A constructive dismissal lawyer would advise an employee to try to resolve the dispute on an informal basis. The employee and employer should consider a settlement agreement. This can end an employment contract with agreed benefits for the employee and a promise not to take a legal case against the employer. The employee would need the advice of an independent constructive dismissal lawyer.

The employee also has an option of mediation. The TUC and Acas have jointly produced a guide to voluntary workplace mediation that is informal, flexible, voluntary and confidential. Furthermore, an employee can take out a formal grievance that sets out the problems with working conditions caused by the employer. Acas has a Code of Practice on Disciplinary and Grievance Procedures that is recognised by an employment tribunal.

Making a legal claim

If the dispute cannot be resolved then the employee needs to consider whether there is a case of constructive dismissal.  To qualify to make a legal claim, the employee needs to have:

  • – ’employee’ employment status,
  • – worked for the employer for two years, and
  • – made the claim within three months less one day of resignation.

The length of service includes the statutory notice period and if the contract breach was serious, the employee should leave as soon as possible. The employer, though, may claim that the employee is not an employee by legal definition but rather a worker or self-employed. The employee should write to the employer setting out his or her complaints and resign. There is no need for the employee to work the notice period.

Not many constructive dismissal claims are upheld in a court. It is also the case that compensation for claims that are successful may not amount to what an employee may expect. To pursue such a claim, the employee would need to have expert help from an employment law solicitor.