Resignation and Constructive Dismissal Basics
Summary
Constructive dismissal is when you resign in response to a fundamental breach of contract by your employer, such as not paying you or destroying trust and confidence. These claims are hard to win and resigning is a serious step, so this article covers the basics and signposts you strongly to advice before you act.
- Employment Rights Act 1996, sections 95(1)(c) and 108 (constructive dismissal and qualifying service)
- Western Excavating (ECC) Ltd v Sharp [1978] ICR 221
- Employment Rights Act 1996, section 86 (minimum notice periods)
Important: this article is general information, not legal advice. Resigning is one of the most serious steps you can take at work and can rarely be undone. Speak to Acas, your union or a solicitor before you resign, however bad things feel today.
What constructive dismissal means
Normally, if you resign, you have not been dismissed and cannot claim unfair dismissal. Constructive dismissal is the exception. Under section 95(1)(c) of the Employment Rights Act 1996, you are treated as dismissed if you resign, with or without notice, in circumstances where your employer's conduct entitled you to leave.
The test comes from Western Excavating (ECC) Ltd v Sharp [1978]. You must show:
- your employer committed a fundamental (repudiatory) breach of your contract, going to the root of the employment relationship;
- you resigned in response to that breach, not mainly for another reason; and
- you did not delay too long, otherwise you may be treated as having affirmed the contract and accepted the situation.
What counts as a fundamental breach
It must be serious. Ordinary unfairness, annoyance or poor management is not enough. Examples that have founded claims include:
- not paying wages, or unilaterally cutting pay or hours without agreement
- demotion or major changes to your role imposed without any contractual right
- serious failures to deal with bullying, harassment or unsafe working conditions, which in care settings can include persistently dangerous staffing levels after concerns are raised
- conduct destroying the implied term of mutual trust and confidence, such as humiliating treatment, false accusations or a wholly unfair disciplinary process
A series of smaller incidents can add up, with a final incident acting as the last straw, but the overall course of conduct must still amount to a fundamental breach.
Why acting promptly matters, and why rushing is dangerous
There is a genuine tension here, which is exactly why you need advice:
- If you carry on working for months as if nothing happened, a tribunal may decide you affirmed the contract and lost the right to resign over the breach.
- If you resign in the heat of the moment, you give up your income, and possibly your notice pay and eligibility for some benefits, on a claim that is notoriously difficult to win. You carry the burden of proving the breach.
Middle paths exist. You can raise a grievance while making clear in writing that you are working under protest and not accepting the change. Working under protest for a short period while the grievance is heard will not necessarily count as affirmation, but the longer things drift, the weaker your position, so take advice quickly rather than either resigning or silently soldiering on.
Qualifying service and time limits
- Constructive unfair dismissal claims normally require two years' continuous service with the employer, under section 108 of the Employment Rights Act 1996. Important exceptions need no qualifying service, including dismissals connected with whistleblowing, health and safety concerns, discrimination and asserting statutory rights. The rules on qualifying service are subject to change, so check the current position with Acas before relying on it.
- The tribunal deadline is three months less one day from the date your employment ends, and you must go through Acas early conciliation first.
- Separate contract claims, for example for notice pay (wrongful dismissal), can sometimes run alongside.
Practical basics if you do resign
- Get advice first. One conversation with Acas, your union or a solicitor can change the whole outcome.
- Resign in writing and state the reason. A resignation letter that says nothing, or thanks everyone warmly, will be quoted back at you later.
- Check your notice. The statutory minimum you must give is one week after a month's service (section 86, Employment Rights Act 1996), but your contract may require more. In a fundamental breach situation you may be entitled to resign without notice, but take advice before doing so. See gov.uk/handing-in-your-notice.
- Keep your evidence: the grievance, emails, rotas, payslips and notes of incidents, gathered lawfully.
- Think about references and regulation. In social care your next employer will seek a conduct reference, so how you leave matters.
Where to get help
- Acas helpline on 0300 123 1100, free and confidential, before you make any decision, and for early conciliation if you have already left: acas.org.uk.
- Your trade union, which can advise on the strength of your position and may fund legal representation.
- An employment solicitor or law centre for advice on the merits before you resign. Many offer a fixed-fee first meeting, and this is one situation where paying for an hour of advice can be the best money you ever spend.
- Citizens Advice for free help with your options, benefits implications and next steps.
Guidance, not advice. This article is general information based on the position at the last update date. It is not legal advice — for your specific circumstances speak to ACAS, your union, your regulator or a solicitor as appropriate.