An employee who resigns because of the way his or her employer has behaved has been constructively dismissed. For a tribunal to make this ruling, the employer’s action has to be regarded as a substantial breach of the employment contract. An example of this might be where the employer arbitrarily demotes an employee to a lower rank or worse-paid position. Last summer, a female engineer with Shell won a case against the oil giant because she was meant to go offshore to gain hands-on experience of a rig, but was instead given an office job while eight male engineers were flown offshore.
A breach of contract alone does not terminate the contract. It is also necessary for the affected employee to resign from the employment within a reasonable time, although this rule is open to interpretation.
What circumstances can lead to constructive dismissal?
These can be varied and complicated. They can include changes to terms and conditions, as well as actions that combine to produce the effect of destroying trust and confidence in the employer. This type of situation might arise where persistent bullying has been allowed to continue in the workplace. The employee might resign rather than take any more abuse. While the final action that causes the resignation might not necessarily be severe in itself, or cause a breach of contract, the employer has not demonstrated a duty of trust and confidence.
What proof do you need?
It is up to the person who resigns to demonstrate that a dismissal actually took place and they didn’t just hand in their notice. The employee must do this by showing that he or she was entitled to consider the contract at an end because of the employer’s behaviour.
If it is found that the employee was forced out, the employer will automatically lose the case
What if the person was asked to resign?
Where pressure to resign exists, the law would consider that person to have been expressly dismissed. This is because a person who is invited to resign isn’t really being given a choice of staying in employment or not. The only choice in this situation is how the contract ends. This means the employer is responsible for bringing about the termination of the contract.
What if the employer claims that his or her actions were fair?
Generally, constructive dismissal is considered to be unfair as a matter of course. Employers defending claims for constructive dismissal at a tribunal usually deny that a dismissal took place. If the tribunal finds that the employee was forced out, the employer will lose the case because they have shown no reason for the dismissal.
An employer could argue that if the tribunal finds there was a dismissal, it was for some other reason. This allows the tribunal to proceed in the usual manner to examine the reason for the dismissal and the employer’s breach of contract. Finding a dismissal fair is most likely to occur when businesses have reorganised and employees resign as a result of consequent changes to their terms and conditions. If the employer acted reasonably by consulting and warning employees, the dismissal of an employee who refused to go along with the changes might be seen as fair.
How can employers avoid being taken to a tribunal?
Angela Johnston is a director of www.v-hr.co.uk, a human resources and employment law web site.