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Constructive dismissal

A claim brought when an employee terminates their contract of employment in response to a breach by their employer

Under section 95(1)(c) Employment Rights Act 1996 (“ERA”) a constructive dismissal is where an employee terminates their contract without notice because of his employer’s conduct

Personality Clashes

In order to be a constructive dismissal, the employer’s conduct must result in a fundamental breach of the employment contract which makes it untenable for the employee to continue working. The employee must resign in response to that breach.

In bringing a claim in the Employment Tribunal there are a number of legal hurdles that must be met in order for an employee to be successful in bringing a claim for constructive unfair dismissal. We are highly experienced in bringing and defending claims of this nature and can guide employees and employers through the process.

Proving the elements of a constructive dismissal

In order to be successful in bringing a claim for constructive unfair dismissal the key factors which must be met are as follows:

  1. There must a repudiatory (fundamental) breach of the employee’s contract by the employer;
  2. The employee must accept that breach of contract. The acceptance must be unequivocal and unambiguous. A resignation (which should normally be immediate, ie. without giving notice) will often be an acceptance of the breach unless it is tendered in the heat of the moment.
  3. The employee must resign in response to the breach. The breach does not have to be the only cause of the resignation an employee who intends to bring a claim for constructive unfair dismissal should make it clear in their letter of resignation that their employer’s behaviour was the reason or at least a significant cause for them resigning.

Often employees who intend to bring a claim for constructive unfair dismissal do not work their notice period. To do so many may have a negative impact on their claim for constructive dismissal as it suggests they are affirming the contract.

Fairness of a constructive dismissal

In a constructive dismissal situation, the employee will have a claim for wrongful dismissal and, if they have the requisite two years continuous service, they will also be able to bring a claim for constructive unfair dismissal. A constructive dismissal will not always be unfair, and the Employment Tribunal will apply the same test to an ordinary unfair dismissal claim. Please see our pages on Unfair Dismissal.

In reality, given that by its definition a constructive dismissal will involve an employer breaching the contract of employment there may be limited circumstances in which an employer will be able to argue that the dismissal is fair. Cases where dismissals are found to be fair often involve changes of contracts for legitimate business reasons such as where there is a downturn in business.

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