When Is Constructive Dismissal Justified?

Constructive Dismissal Justified

An employer may be found to have committed constructive dismissal when they implement significant and unilateral changes to essential employment terms such as salary (salary and benefits), job responsibilities, reporting functions within the organisation hierarchy, working conditions, and hours of work. This type of change can leave an employee with no choice but to resign from their position. It must either be a single major change or many minor changes that result in an intolerable work environment (death by a thousand cuts). The discussion below pertains to non-unionized environments; unionized employees should consult their respective workplaces’ grievance processes.

While there is no one answer, it has been established in case law that an employer has committed constructive dismissal when the breach of contract was so serious that it caused an employee to resign and seek alternative employment. The key is that the employer’s actions must be considered a repudiatory breach of the term of trust and confidence implied in all employment contracts, meaning it was a fundamental breach that destroyed the relationship between employee and employer.

In addition, the breach must have been made intentionally or without just cause. A misunderstanding or inadvertent mistake will not suffice, and an employee’s subjective perception of the situation must be taken into account. This is the main difference between constructive and wrongful dismissal, where an employer can be found to have acted unnecessarily by firing the employee with or without notice.

When Is Constructive Dismissal Justified?

The breach can be in the form of an explicit or implicit term; an explicit term breach would include something such as cancelling employee benefits, changing a defined job responsibilities, imposing an arbitrary suspension, or a reduction in pay. An implicit term breach, however, is more difficult to prove. Case law has found that a breach of the implied condition that an employer must treat an employee fairly, without malice, is sufficient to justify a constructive dismissal lawyer claim.

It’s important to note that the term “constructive dismissal” is often used interchangeably with a term called “constructive termination.” The latter term, which is more commonly discussed, refers to an involuntary resignation from an employment contract due to an intolerable work environment that was caused by the employer. Involuntary termination of an employment contract typically occurs when the employer is not able to provide adequate notice, whereas constructive termination can occur for many reasons, including workplace discrimination.

An employee who believes they have been a victim of constructive dismissal may be entitled to damages such as their lost income, loss of career progression opportunities and other compensation depending on the nature of the breach and the circumstances surrounding it. It is vital to seek legal advice at the earliest opportunity, so that you can ensure your rights are protected and any necessary paperwork and documentation is completed properly. At Ball Professional Legal Corporation, we can assess the specific circumstances of your situation and determine whether you have a case for constructive dismissal. Contact us today to get started.