Constructive dismissal is one of the most frequently misunderstood concepts in employment law. Many employees believe that if work becomes unbearable, they can simply resign and claim constructive dismissal: but the legal test is considerably more demanding than that. This guide explains what constructive dismissal means, what you need to prove, and the critical steps you must take to protect your position.
Constructive dismissal occurs when an employer's conduct is so serious that it amounts to a fundamental breach of your employment contract, leaving you with no reasonable alternative but to resign. In those circumstances, the law treats your resignation as equivalent to a dismissal, which then allows you to bring an unfair dismissal claim.
The key point is that the employer does not actually dismiss you. You resign. But because the employer's conduct forced your hand, the law treats the situation as if you were dismissed.
The employer's conduct must amount to a fundamental, or repudiatory, breach of your employment contract. Not every breach qualifies. It must go to the root of the contract and undermine the entire employment relationship.
Examples of conduct that can amount to a fundamental breach include:
The implied term of mutual trust and confidence is particularly important. It is implied into every employment contract and means your employer must not, without reasonable and proper cause, act in a manner likely to destroy or seriously damage the relationship of trust and confidence between employer and employee. A sustained course of unreasonable conduct: even if no single act is sufficiently serious: can cumulatively amount to a breach of this implied term.
Before resigning, you should in most cases raise a formal grievance with your employer. This does two things: it gives the employer a genuine opportunity to address the situation, and it creates a record that you attempted to resolve matters internally before taking the drastic step of resigning. Failure to raise a grievance can affect your compensation if your claim succeeds.
One of the most common mistakes in constructive dismissal cases is continuing to work for too long after the conduct complained of. If you work on for months after the triggering incident without resigning or registering a formal objection, a tribunal may conclude that you affirmed the breach of contract: effectively accepting the employer's conduct, which would defeat your claim.
If you decide to resign, do so promptly after the fundamental breach has occurred or has been finally established. Your resignation letter should clearly state that you are resigning because of the employer's conduct.
The time limit for a constructive dismissal claim is three months minus one day from the date of your resignation. You must first contact ACAS for early conciliation, which pauses the time limit. Do not delay.
To succeed in a constructive dismissal claim, you must prove:
Even if you prove constructive dismissal, the tribunal will then consider whether the dismissal was unfair. In practice, constructive dismissals are usually found to be unfair, but the employer can argue in mitigation.
Constructive dismissal occurs when an employer's fundamental breach of contract forces you to resign. The breach must be serious: not merely inconvenient or unpleasant. You must raise a grievance, resign promptly in response to the breach, and submit a claim within three months of your resignation date. The legal test is demanding and specialist advice is strongly recommended before you resign, as resigning in the wrong way or at the wrong time can undermine an otherwise strong claim.