October 9, 2018

A constructive dismissal occurs not when an employee is dismissed, but when the employee resigns and was entitled to do so because of the employer’s conduct.

There are three elements that must be proven for a constructive dismissal:

  • The employer must have committed a repudiatory breach, which is sufficiently serious enough to justify the employee resigning.
  • The employee has accepted the breach and treated the contract as at an end. The employee must resign as a result of the breach.
  • The employee did not delay in resigning, and therefore did not delay in accepting the breach.

What Is A Repudiatory Breach?

A repudiatory breach is a breach of an express or implied term that is so severe, that is going to the root of the employment contract. The breach may have already occurred, or the employee may anticipate that such a breach may occur. An employee is still entitled to resign in response to an anticipated breach.

A repudiatory breach may be a one-off act or a continuous course of conduct, resulting in a ‘last straw’ incident.

Proving A Repudiatory Breach

For a claim to be successful, an employee must prove there has been a repudiatory breach:

  • They must first identify the breach in question;
  • They must then establish the evidential basis on which their claim will be based;
  • The tribunal must be satisfied that the evidence presented does in fact amount to a repudiatory breach.

Vicarious Liability

A constructive dismissal claim may be based on the behaviour of a fellow employee. As an employer, you are liable for acts committed by employees during the course of their employment.

Whilst a breach will normally be directed by the employer at the employee, it can extend further to any conduct by the employer likely to damage the implied term of trust and confidence. Therefore, it is possible that you could breach the duty owed to one employee, by your behaviour towards another. Crucially, you may also be liable for the actions of a third party. However, this can be quite difficult to prove in practice.

 Damages For Constructive Dismissal

If it is proven that an employee has been constructively dismissed, they will be entitled to claim for damages for wrongful dismissal and breach of contract. Additionally, the employee may be able to claim for unfair dismissal if they have the necessary qualifying period of service (2 years for employees who started on or after 6th April 2012, for employees who started before this, only one year’s continuous service is required).

Avoiding A Claim For Constructive Dismissal

As an employer, there are ways in which you may be able to avoid a claim being brought against you.

  • Make sure you have good procedural practices in place to deal with performance management, disciplinary and grievances, and dismissals. You should ensure that all staff are aware of these procedures and that they are implemented fairly and equally to all employees.
  • If possible, try and resolve the matter internally before the situation escalates.
  • If you do suspect that an employee may try and bring a claim for constructive dismissal, you could contact them in writing, inviting them to a meeting to discuss the matter further and come to a suitable solution for all.

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About the author 

James Rowland

James is the Commercial Director at Neathouse Partners and regularly writes articles surrounding issues in HR & Employment Law. Outside of the office, James is a keen Cricketer, playing in the Cheshire League for Nantwich CC. He also loves going to watch his football team, Crewe Alexandra. Feel free to connect with James on LinkedIn.

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