News & Views

Constructive dismissal

BY Margaret Anne Soderqvist-Clark
Employment law
BG Purple

In a constructive dismissal case, the employee must show that there has been a fundamental breach of contract, that they have resigned in response to this breach and that they have not delayed too long between the breach occurring and the date of resignation. 

In many cases, it will be obvious what the breach is and why the employee resigned.  In other cases, however, things might be less clear. 

In the case of Logan v Celyn House Ltd., the employee resigned after her grievance was not upheld by her employer.  The grievance related to alleged bullying (which the tribunal found had no substance at all) and also to a failure to pay contractual sick pay (which the tribunal found was a fundamental breach).  The tribunal found that the main reason for the resignation was the alleged bullying and not the sick pay and therefore rejected the employee's claim. 

This decision was overturned by the EAT. It was enough that the failure to pay sick pay was a reason for the resignation even if were not the principal reason. 

While the case is interesting from a legal perspective, it is also a sharp reminder to employers of the need to behave reasonably during a grievance process, regardless of the fact that the grievance may have no substance.  In this case, the employer managed by their subsequent behaviour to convert an allegation of bullying that had no potential whatsoever of being a constructive dismissal into an expensive claim simply by failing to follow their contractual sick pay process in the midst of the hearing.

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