Employment Relations

Constructive dismissal? If only it were that simple

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In my twenty years or so dealing with employment issues there has been one issue above all others that causes confusion. I’m talking of Constructive dismissal, that unusual employment concept where a resignation can be considered as a dismissal on account of the employer’s conduct.

But if only it were that simple…

Take the case of Roger, a manager who was struggling with his workload. He had a high profile role, but was often late with reports; and regularly missed targets. However, rather than raise his problems with the CEO, he struggled on. Unfortunately, the CEO lost patience with Roger’s excuses, and decided action was necessary.

A decision was taken; and the CEO said he would remove two key duties from Roger and pass these to another manager.

Subsequently, an angry Roger contacted me, saying he’d been undermined. He felt that losing two important duties would reduce his status and amount to demotion.

Clearly the CEO had jumped the gun by taking action without properly consulting Roger. But I soon learnt that Roger would suffer no loss in salary or other benefits; and that his job title and position in the organisation would be unchanged.

Yet Roger was threatening to resign, insisting that he was being constructively dismissed.

Despite his obvious distress, I explained to Roger that resignation would not be wise; and that it was highly unlikely that his union would support a claim of constructive dismissal. Indeed, it is something that is rarely pursued to a successful legal conclusion; and here is why…

Constructive dismissal occurs when an employee terminates his/her contract of employment, with or without notice, directly because of the employer’s conduct. Significantly, the employer’s conduct must be more than just unreasonable. It must amount to a fundamental breach that goes to the root of the employment contract. In other words, something which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract.

In Roger’s case, the employer acted in response to missed targets; and said that removing some duties was designed to help him mange his remaining workload. Indeed, his job title, terms and conditions would be unchanged. What’s more, the two duties, although key, were only part of his overall job description. All things considered, it simply did not amount to a fundamental breach going to the heart of the employment contract.

Surely the lesson here is that however badly you feel you’ve been treated, think carefully before resigning. There are some serious legal hurdles to clear for you to have any reasonable chance of success in claiming unfair constructive dismissal (see box). But even with a strong case you have no guarantees.

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So rather than walk out; go through a lengthy legal process (which includes paying tribunal fees) and take your chances in court; seeking a negotiated settlement to the problem is usually the less risky option. If you are already in a trade union, then they should be your first port of call.

As for Roger? Well he didn’t resign. With his union’s help he and the CEO agreed to a temporary transfer of the two duties in question while he undertook some time management training. He stayed in post for another 16 months before eventually moving to a new employer.

Note: The above is not a substitute for legal advice. Please seek help from your trade union or a solicitor regarding your specific circumstances

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