Constructive dismissal, known in full as constructive unfair dismissal, occurs when an employee feels unable to continue in their employment because of a breach of their contract terms and so resigns, leaving either with or without serving out a notice period.
Constructive dismissal
Expert legal advice and representation
At Hutchinson Thomas we can advise and represent you in the event that you have an employee who is claiming constructive dismissal. Our advice is practical and commercially-focused and we will work on your behalf to resolve the matter as quickly as possible.
We have extensive experience across a range of sectors and we understand how important it is for a business to be able to operate smoothly without the disruption of impending litigation. Dealing with a legal claim can be disruptive, costly and a threat to reputation. Our aim is always to deal with problems effectively before they escalate and to find an acceptable solution that enables you to put the matter behind you.
What constitutes constructive dismissal?
Constructive dismissal arises following a repudiatory or fundamental breach of the terms of an employment contract. The employee resigns because of this breach, usually without delay and without working out their notice.
The breach must be something that is so serious that it goes to the root of the employment contract. This could be unlawful discrimination, making unilateral changes to hours worked, location or pay, or unreasonable demands that could either set the employee up for failure or make their job so difficult that they felt pushed into resigning.
A sequence of fairly minor events could cumulatively be held to be enough, when taken together, to constitute a fundamental breach of contract.
There are certain criteria which the employee must meet, including bringing a claim without delay, to avoid implied acceptance of the breach, and setting out in their letter of resignation their reasons for going.
We can advise you on the strength of your defence and work with you to negotiate a settlement if it does seem that your employee may have a valid claim.
Avoiding claims for constructive dismissal
Well-drafted employment contracts that clearly detail employer and employee obligations and rights and also set out a grievance procedure will help employees avoid the need to resign to have their complaints heard. We can advise you in respect of both your employments contracts and employee handbooks and policy documents to ensure that they are as robust as possible.
In the event that you have an employee who appears to have a valid claim for constructive dismissal, we can advise you on a negotiated settlement agreement. In effect, this is a payment to the employee in return for their agreement to drop all claims against you and also to keep all matters confidential. It will allow a clean break for both of you, so that you can put the matter behind you and focus on your business.
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If you are being threatened with a claim for constructive dismissal, it is advisable to deal with it as soon as possible, before positions become entrenched. An acceptable solution can often be reached quite quickly with early intervention, limiting disruption and keeping costs to a minimum.
Hutchinson Thomas is the first law firm in Wales to be awarded the Law Society Mark of Excellence. The firm and many of our lawyers are recognised year on year in the Legal 500 publication as leading individuals in their field.
We work with employers across all of their employment law requirements. If you would like to speak to one of our expert employment solicitors about constructive dismissal and settlement agreements, please feel free to call us on the following numbers or fill in our contact form.