What is it?
In simple terms when an employer acts
in a way that permits an employee to resign without notice and
the employee has more than 1 years service he/she can make a claim
of Constructive dismissal as if he/she has been unfairly dismissed.
The employer has to have fundamentally breached
the employee’s Contract of Employment either in a written term (express term), or in an implied term.
Lets now deal with what could amount to a fundamental
breach of contract; examples of this are numerous but let me give
an example.
Mabel is the Assistant Manager of Betty’s Better
Bit of Butter Ltd. They manufacture butter and other
dairy products. She has worked in this role for 10
years. The New Managing Director Nick McNasty does not
like Mabel and considers she is too friendly with the staff. He
tells Mabel that she is not up to the job and he demotes
her without any disciplinary process. He has not sacked
her but the demotion would amount to a fundamental breach
of contract entitling Mabel to resign and claim constructive
dismissal. |
Other examples would include not paying a contractual bonus reducing the employee’s pay without having an express contractual right to do so.
Remember these are examples of breaches of express
contractual terms the employer can also breach implied terms.
The most well known implied term in all Contracts
of Employment is the term of mutual
trust and confidence. That
is that both the employee and employer must behave reasonably and
fairly when dealing with each other. This does not mean that all
acts of unfairness would amount to a fundamental breach of contract
only the most serious acts could. For example, if an employer was
simply a bit rude on one occasion with an employee then this would
probably not amount to such a breach. If however he was consistently
bullied the employee this certainly would amount to a fundamental
breach of contract.
The employee cannot dither or delay in resigning
if such conduct occurs as delay can amount to a deemed acceptance
of the breach.
Lets go back to the Mabel example. If she is
demoted and continues to carry on working there for some months,
then it is likely that she would be deemed to have accepted the
breach of contract.
The Last Straw concept;
This is were there are occasions when an employee can resign and claim constructive dismissal even if the last act did not on its own amount to a fundamental breach of contract. Say Mabel does not resign when she is demoted but she over time considers her employer is picking fault at every opportunity and blaming her for issues. Then providing she can prove it and show this then even if the last act on it’s own is relatively minor provided it is the principle cause for her resignation then she can still claim constructive dismissal. She does need to show one of the acts was a fundamental breach of contract but in Mabel’s case she was demoted and so she would have a claim.
You will gather that constructive dismissal is
complicated and before you resign you should try and get legal
advice on whether you would have a claim or not.
The fact is that in constructive dismissal the
employee has to prove their case in order to succeed. This is why
the employee in such a case goes first at the Tribunal and gives
their evidence before that of the employer. In some cases if the
employer’s lawyer thinks that the employee has failed to establish a prima facie case then he will make a submission to the tribunal that the employer has no case to answer.
Prima facie means put forward sufficient evidence that if the employer cannot explain or refute the allegation then the employee would win the case.
In conclusion in proving a case of constructive
dismissal the resignation letter should normally in clear terms
spell out in basic terms why the employee is resigning and what
actions caused the resignation. Under the new Dispute Resolution
Rules the employee must now raise a grievance and complain about
the employers actions and wait 28 days to give the employer the
opportunity to conduct the internal grievance process before a
claim can be lodged at the Tribunal.
The normal 3 months time limit runs so that any
claim must be submitted in time. There is an exception if the grievance
process is still ongoing when the first 3 month time limit expires
but my advice would be do not delay and get the tribunal claim
in after the first 28 days and before the 3 month time limit expires
even if the internal process is still not concluded. Practically
this is because if the grievance result was to conclude say a couple
of days before the 3 month time limit expires then you would have
to rely on asking the Tribunal to permit the claim on the basis
that it was not reasonably practicable to lodge the claim in time
and clearly it was.
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