Constructive Dismissal

What is a Constructive Dismissal?
Constructive dismissal is the term used to describe a situation where an employee resigns "in circumstances such that he is entitled to terminate [his contract] without notice by reason of the employer's conduct" Employment Rights Act section 95(1)(c).

What are the Elements of Constructive Dismissal?
The employer's conduct in such a case is termed a "repudiatory breach of contract" and the employee's resulting resignation will rank as dismissal, termed "constructive dismissal". Technically, the employee is said to have accepted the repudiation of the contract by the employer.

There are four elements in a constructive dismissal claim:

  • there has to be a breach of contract by the employer. This can be actual or anticipatory;
  • the breach must be sufficiently important to justify the employee resigning or the last in a series of incidents which justifies leaving;
  • the employee must leave in response to the breach and not for some unconnected reason; and
  • the employee must not take too long about leaving.

The Breach of Contract by the Employer
For an employee to be entitled to terminate his contract by reason of the employer's conduct the conduct must have been so seriously wrong that it amounted to a "fundamental breach of contract". It may be a single act or a culmination of a number of smaller acts and the final act being known as the “last straw”.

The general principle is that if an employee resigns without letting the employer know that it was the employer's conduct which was the real reason for his resignation, that resignation will
not be "constructive dismissal".

Further, an employee must resign in response to the employers conduct. Delay may be an indication that their resignation is not connected with the employer's conduct therefore the employee
must act promptly. Moreover, for a constructive dismissal claim to succeed the employee must show that there was a causal link between the employer's wrongful action and the employee's

Disclaimer: This article does not contain a full statement of the law and it does not constitute legal advice. Please contact the Employment Law Team on 020 3743 0600 if you have any questions about the information set out above.

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