If you can show a tribunal that your employer has acted unlawfully, thus making your position untenable, you may have a claim for constructive dismissal.
Constructive dismissal is when your employer puts you in a situation where you feel you have no choice but to resign.
Unlike unfair dismissal, where your employer ends your employment without following fair and proper procedures, in constructive dismissal, the employee is the person who terminates their employment – but only because their employer has breached their duties or seriously damaged the relationship of trust and confidence between them.
The breach of contract could be one specific incident or a series of separate events that are considered serious when looked at together. The onus is on you to prove that your employer left you with no choice but to resign.
Examples could include where your employer has:
- allowed clients or colleagues to harass or bully you at work
- demoted you without a good reason and/or without consultation
- made unreasonable changes to your working conditions, for example by cutting your pay
- or making you work longer hours
- removed benefits your contract says you are entitled to
- failed to provide you with the support you need to do your job
- failed to ensure your working environment was safe
- failed to pay you.
Am I eligible to claim for constructive dismissal?
Only employees can claim constructive dismissal. You are not eligible to claim constructive dismissal if you are freelance, self-employed or working under a fixed-term contract.
In most instances you also need to have been employed for at least two years before you are eligible to make a constructive dismissal claim. There are two exceptions to this rule:
a) If you can show that your employer breached your contract for a reason that was ‘automatically unfair’ – for example because you:
- were pregnant or on maternity leave
- have refused to work on Sundays
- have asked your employer to give you your legal rights (eg to pay you the minimum wage)
- took action about a health and safety issue
- are a member of a trade union and took part in trade union activities – such as official
- industrial action or acting as an employee representative
- have reported your employer for wrongdoing (whistleblowing)
b) The second exception is if you can show that you were discriminated against because:
- you are pregnant or on maternity leave
- of your race, ethnicity or nationality
- you are married or in a civil partnership
- of your sex, gender identity or sexuality
- you have a disability
- of your religion
- or because of your age.
What should I do if I haven’t resigned yet?
You are advised not to resign without first taking legal advice. Even if you are sure that you have grounds to claim constructive dismissal, if you leave your job without having taken certain key steps, you could weaken or destroy your case at a tribunal.
First of all you should try to resolve the prevailing issues by telling your employer about your concerns. ACAS recommends you should give your employer an opportunity to resolve the dispute by lodging a formal grievance before discussing the possibility of resignation. You are strongly advised to report any bullying or threatening manager to your HR department or your manager.
You can still claim constructive dismissal, even if you haven’t lodged a grievance, however should you win your case, an employment tribunal can reduce the damages you’re awarded by up to 25% if you failed to lodge a grievance before you resigned.
If you think that your employer’s actions amount to constructive dismissal, you should start to gather evidence. Keep hold of emails and make a note of anything that is said or done that could be helpful to your case, taking care to record names and dates.
It is particularly important that you do not say or do anything that could enable your employer to argue at a tribunal that you accepted their breach in contract. This means you must tell your employer you are not happy with their treatment of you as soon as it happens. It is vital that you do not let unacceptable changes to your working conditions go on, unchallenged, for any length of time and that you do not say or write anything to the effect that you accept what is happening.
If you do resign, you should state clearly in your resignation letter your reasons for leaving the job and explain that you consider yourself to have been constructively dismissed. Your claim at a tribunal has a much better chance of success if you seek proper legal advice as early as possible – ideally before you leave your job.
Should your claim be successful, in assessing how much compensation to award the tribunal will consider whether you took reasonable steps to mitigate your financial losses. You are therefore strongly advised to begin looking for a new job – at a similar level of pay – as soon as possible. If the tribunal concludes that you failed to take reasonable steps to find a new source of income, it is likely to reduce the amount of compensation it awards you, because it would hold you, rather than your former employer, responsible for at least some of the financial losses you have incurred.
What if I am offered a settlement agreement?
If you and/or your employer want your employment to end, you may be offered a settlement agreement. This is a legally binding contract that waives your right to make further claims about an employment dispute or alleged breaches of your contract. It is likely to include some form of payment and may also include agreed wording for a reference.
Given the significance of waiving your rights, you will be required to seek professional legal advice before signing a settlement agreement because, once a valid settlement agreement has been signed, you will not be able to make any employment tribunal claims about anything which is covered by the agreement.
Before you make a claim
If you’re going to make a claim to an employment tribunal, you must do so within three months of the last breach effecting the constructive dismissal or, if you have already resigned, within three months of the date you left.
You must tell also ACAS (the Advisory, Conciliation and Arbitration Service) that you intend to make a claim to an employment tribunal. You may then try to settle the dispute without going to court by using the free ACAS early conciliation service. If early conciliation doesn’t work, you can still make a claim at a tribunal. ACAS can give you a certificate to ensure that time spent in early conciliation doesn’t affect the total amount of time you have left to make your claim.
How to make a claim
To begin the process of claiming constructive dismissal at an employment tribunal, you need to fill in a claim form. You can either do this online or by post.
You are strongly advised to seek professional legal advice before you make a claim for constructive dismissal. The process can be complex, and any failings on your part could compromise the strength of your claim with the tribunal.
Your (former) employer will have to respond to your claim form. They usually have to reply in writing within 28 days of receiving the form. When they’ve replied, the tribunal will decide how best to respond to your case. If your employer doesn’t respond, the tribunal may decide on the case without you having to go to a hearing, however it is likely that the next stage of the process will be an invitation to attend a preliminary hearing.
At this initial hearing a judge will decide whether your claim can go ahead and, if it can, he or she will set a date and time for the hearing. There will also probably be some discussion of the documents that you and the respondent (your employer) will need to provide.
Professional legal advice will make sure you have got all the evidence you will need for the hearing. You may also need to arrange for witnesses to attend the hearing. If a witness who could give evidence directly relevant to your case refuses to come, you can ask the tribunal to order them to attend. You will be responsible for paying the witness’s expenses.
At the hearing, which will probably be held in the tribunal office closest to your place of work, you must take along all the documents that support your case.
You may be told the tribunal’s decision straight after the hearing but you’re more likely to receive a decision in the post a few days or weeks later.
What happens next?
If you win your case, the tribunal may order your employer to do one or more of the following:
- pay you compensation
- pay your (legal?) costs
- give you back your job
- improve your working conditions
The amount of compensation you are likely to be awarded depends on various factors and there are limits imposed on certain cases. If your employer is ordered to pay you compensation and then fails to do so, you can ask a court to have them fined and to force them to pay.
If the tribunal awards in the employer’s favour, it may also ask you to contribute to the employer’s legal costs if it finds that you have acted unreasonably (for example if you have acted vexatiously or abusively or if you rejected a reasonable offer to settle the claim without going to court).
If you want to ask the tribunal to reconsider its decision, you must write to the tribunal office within 14 days of getting the decision, and provide a good reason why they should reconsider – for example you might have clear evidence of mistakes they made in their decision-making; there might have been errors in their communications with you, which harmed your case; or you might have new evidence. If you think the tribunal made a legal mistake, you can also appeal to the Employment Appeal Tribunal. Again, take legal advice on the merits of pursuing an appeal.