Constructive Dismissal

Constructive dismissal examples of reasons that you can resign

Examples of situations where you may have a claim for constructive dismissal include:

• Withholding your salary , even if for good reason and to a small extent;
• Reducing your salary without your consent, or threatening to reduce your salary;
• Demoting you without good reason or in breach of contract;
• Changing your job duties, whether this is removing some duties or demanding that you perform new ones;
• Discriminating against you ;
• Failure to deal with a grievance that you have submitted;
• Failing to deal with an appeal that you have submitted (for example, an appeal against a grievance or disciplinary outcome);
• Failure to deal with a disciplinary process fairly and competently;
• Dealing with you unfairly while you are on sick leave;
• Giving you an excessive workload ;
• Creating an intolerable working environment for you (for example, the use of bad language, forceful management styles, and abusive behaviour);
• Giving you a bad reference;
• Your colleagues making negative comments about you;
• You are being forced to work in breach of health and safety rules;
• If your colleagues have been harassing you or bullying you at work;
• Your employer making unfair findings about you or reporting you to a regulatory without good reason (or giving you an opportunity to respond)

Please note that the above list is not exhaustive.

Is it easy to make a claim for constructive dismissal?

The short answer is that it very few constructive dismissal claims are “easy” – even if you have a potentially strong claim for constructive dismissal the process of bringing a claim in the Employment Tribunal , and the time involved in doing so, can be difficult and stressful.

In order to bring a claim for constructive dismissal you must meet certain criteria:

1. You must have been continuously employed by the same employer for two years or more (unless the claim falls within one of the exceptions, for example if you have blown the whistle or have been discriminated against – this is dealt with in more detail below);
2. You must be able to show that your employer has fundamentally breached an express or implied term of your contract of employment (for example, discriminating against you could be a breach of the implied term of mutual trust and confidence in your contract of employment);
3. You must show that you have resigned from your employment as a result of the breach (and must not delay in doing so)

In some cases it will be obvious that your employer has breached your contract – for example, where your employer has withheld your wages or sexually harassed you.

In other situations it may not be so clear that there has been a breach of contract – your employer may have acted in an unreasonable fashion towards you but you will need to show that this behaviour was so unreasonable that your continued employment was untenable – the exact legal test is that “ whether, looking at all the circumstances objectively, that is from the perspective of a reasonable person in the position of the innocent party, the employer has clearly shown an intention to abandon and altogether refuse to perform the contract “.

You are best advised not to resign without taking legal advice first. You may otherwise lose an important tactical advantage against your employer, and also put at risk any subsequent tribunal claim. We can advise you of the best way forward, and will consider a no win-no fee funding arrangement.

What steps should I take in order to successfully bring a constructive dismissal claim?

It is recommended that you take the following steps when looking to bring a constructive dismissal claim:

1. Try and resolve your problems in your job without resigning;
2. Lodge a grievance complaining about the conduct in question;
3. Complying with the grievance procedure;
4. Appealing against the grievance outcome, where appropriate

These are explained in more detail below.

Try and resolve your problems without resigning

This may seem like counter-intuitive guidance, given that you are looking for advice on how to bring a constructive dismissal claim, but it may be the case that you are able to resolve the problems that you are experiencing at work without having to resign from your job – you can either do this informally, by having a chat with your line manager or another senior manager to try and find some resolution, or, alternatively, you can try and resolve your complaints formally via your employer’s formal grievance process.

Lodging a grievance

It is almost always recommended that you submit a formal grievance before taking any step to resign from your employment – a failure to lodge a formal grievance might damage a potential constructive dismissal claim and would, generally, be in breach of the  ACAS Code of Practice on Disciplinary and Grievance Procedures  (“the ACAS Code”).

The reasons why it is recommended that you submit a formal grievance before resigning are as follows:

• It allows your employer to address the complaints that you are raising and potentially take steps to remedy them or apologise;
• It could allow you to resolve your situation with your employer without recourse to legal action; and
• If you don’t submit a formal written grievance then any compensation that you win in a claim for constructive dismissal might be reduced to reflect the fact that you did not follow the ACAS Code

The above applies even if you have no intention of remaining in your job once you have submitted the grievance – the submitting of the grievance can be an important tactical step in terms of both negotiating an exit from your employer (see below) and/or pursuing a claim for constructive dismissal in the Employment Tribunal.

Do I need to comply with my employer’s grievance process?

You should normally take reasonably practicable steps to comply with your employer’s grievance procedure otherwise, as above, it may prevent a successful outcome to the grievance and/or mean that you are breaching the ACAS Code.

However, your employer must be reasonable in their approach to the grievance process and, if they act unreasonably, they may be in breach of the ACAS Code themselves (leading to a potential ‘uplift’ in the value of the compensation that you may seek in a constructive dismissal claim. Equally, if your employer acts unreasonably in the grievance process then it might give you further grounds (or, at the least, evidence) for your claim for constructive dismissal.

Should I appeal the outcome of my grievance?

Again, the answer is generally ‘yes’ – it’s generally a good idea (for the reasons detailed above) to appeal the grievance outcome even if you have no intention of staying at your employer and/or the outcome of your appeal is, to your mind, a foregone conclusion.

What evidence do I need to gather to succeed with a constructive dismissal claim?

Only a small amount of claims succeed in the Employment Tribunal each year, with the main reasons for constructive dismissal claims not succeeding being that:

1. There is not sufficient evidence to show that your employer acted so badly to mean that resigning was your only option;
2. The Employment Tribunal deciding that the employee ‘waived the breach’ by, for example, delaying too long in resigning; and
3. The Employment Tribunal deciding that the employee left their job for a reason other than the alleged breach of contract (for example, if the employee had already lined up a new job or had left to start an educational course)

You should therefore seek to put together evidence at an early stage showing breaches of contract by your employer – these could be, for example, text messages, WhatsApp messages, diary notes of conversations or events, emails, telephone notes etc.

Constructive dismissal compensation: what can I win in a claim?

There are two types of award that you can receive if you succeed with a constructive dismissal claim:

1. Basic award  (which is equivalent to a statutory redundancy payment);
2. Compensatory award  (which is comprised of loss of earnings, loss of bonus and/or commission, loss of pension, as well as the loss of other financial benefits)

Negotiating an exit if you’ve been constructively dismissed

If you believe that your employer is breaching your contract of employment then it is normally advisable to see if you can negotiate an exit package (via a  settlement agreement ) before you resign from your employment.

If you have grounds to bring a claim for constructive dismissal then a successful exit negotiation would normally result in you receiving a sum of compensation for the termination of your employment. It is common for an exit package to be offered by an employer if you have filed a grievance for a number of reasons, not least the fact that once you have formally filed a grievance with your employer there is a strong chance that the relationship with your employer has broken, or will break, down; this is regardless of the outcome of the grievance process. Your employer will normally want to have a protected conversation with you at first, and they may put forward a without prejudice offer (containing the terms of the exit package).

Negotiating an exit package in these circumstances is a highly strategic situation and one that normally requires a delicate tactical touch – the success of the settlement negotiations will depend upon how you approach the negotiations and the potential strength of your claim. We therefore recommend that you seek legal advice on the strength of your claim, the potential value of your exit package, and on the approach that you should take to the negotiations; equally, seeking legal advice will allow you to avoid missteps in the negotiations which could weaken your exit negotiations.

We have advised thousands of clients on exit negotiations where they have had no choice but to seek an exit package or resign as a result of their employer’s conduct, and we have a strong track record with producing positive results. As part of the settlement terms we will ensure that, as well as receiving financial compensation, that appropriate non-financial terms are agreed such as:

• The provision of an agreed reference to prospective employers;
• Mutual confidentiality clauses; and
• ‘Non-derogatory’ clauses which prevent your employer from ‘bad-mouthing’ you

Further reading: how to submit a claim in the Employment Tribunal

Examples of successful constructive dismissal claims in the Employment Tribunal

• Mr T Mohammed v Crown Prosecution Service: 3323914/2016 and others – in this case the Employment Tribunal awarded the Claimant, a former employee of the CPS, over £130,000 after finding that he had been constructively dismissed and subjected to disability discrimination ( read the decision of the Employment Tribunal )
• Mrs S Goodison v High Speed Two Ltd (HS2): 2207032/2021 – in this case the Employment Tribunal awarded the Claimant over £7,500 in compensation after finding that various failings by the Respondent had meant that she had been constructively dismissed ( read the decision of the Employment Tribunal )
• Mr P Ballam v Dacorum Borough Council: 3310650/2021 and 3302380/2022 – in this case the Employment Tribunal awarded the Claimant over £24,000 in compensation after finding that he had been subjected to a constructive dismissal and disability discrimination ( read the decision of the Employment Tribunal )

Our analysis of claims for constructive dismissal in the Employment Tribunal

• Failure to relocate sexual harasser left employee no choice but to resign (Miss S Stretch v Ballymore Construction Services Ltd ET3202196/2019)  – in this case the Employment Tribunal ruled that Ms Stretch had been sexually harassed by a colleague and that her employer had failed to take steps to prevent Ms Stretch from having to work with her harasser ( our analysis here )
• Employment Tribunal finds that failure to carry out recommendations of occupational health report was discriminatory (Miss C Robinson v Mind Monmouthshire Ltd – ET/1600412/2018)  – in this case the Employment Tribunal upheld an employee’s claims for  disability discrimination , constructive unfair dismissal, and victimisation after her employer failed to carry out the recommendations of an occupational health report ( our analysis here )
• Tribunal finds that pregnant woman was discriminated against after unfair criticism made of her work (Miss N Grant v Hunter Price International Ltd and Others ET/2410479/2018)  – in this case the Employment Tribunal held that the Claimant had been constructively dismissed, discriminated against and victimised after being subjected to intense pressure by employer ( our analysis here )