We have recently received a lot of enquiries from employees or former employees, who consider they have been treated so poorly by their employer/former employer that they may be able to claim constructive dismissal.
However, many people are still unsure about what constructive unfair dismissal is and when a claim can be made. I therefore set out the answers to many of frequently asked questions about constructive unfair dismissal:
1. What is the difference between Constructive Unfair dismissal and Unfair Dismissal?
The main difference is that the burden of proof falls on the employee rather than the employer.
If an employee decides to resign, rather than the employer dismissing, the onus is on the employee to show that they resigned in response to the employer’s fundamental breach of contract. Whereas, with an unfair dismissal claim the onus is on the employer to show that they behaved reasonably in all the circumstances.
2. Does the employee’s resignation letter need to set out why they resigned?
It is helpful for their claim evidence if an employee sets out their reason for resigning within their letter of resignation. However, if the letter does not set out in full the reasons for leaving, i.e. it does not state they are leaving due to the treatment from the employer, they can still make a claim.
3. Does the employee have to submit a formal grievance?
I always recommend that an employee raises a grievance before deciding whether to resign, as the Employment Tribunal prefer for an employee to give their employer an opportunity to try and resolve matters.
Further, if the employer fails to follow the Acas Code of Practice in relation to the grievance, then they could claim a 25% uplift on any compensation awarded by the Employment Tribunal.
However, the process can be stressful and by this point an employee is usually already under a significant amount of pressure, therefore, an employee may be reluctant to follow the process. Perhaps a grievance has been raised in respect of other concerns, which was not dealt with appropriately, and they therefore consider there is no point in raising another grievance.
There are many reasons an employee may not raise a grievance and whilst the Employment Tribunal do prefer for the employer’s internal process to be followed, it again will not prevent them from pursuing a claim.
4. Can the employee give notice and still make a claim?
Normally when an employee resigns, due to their employer’s behaviour, they do so with immediate effect i.e. they do not work their notice period.
Whilst it is preferable to resign with no notice, if notice is given it does not necessarily mean their claim will fail. However, this will depend on the length of the notice period, as there is the possibility, they could accept the employer’s breach by remaining employed for too long. Therefore, the longer the notice period, the more difficult it would be for an employee to show they resigned due to a fundamental breach by the employer.
If an employee gives more notice than is required under their contract of employment, then this is likely to weaken any claim, as again it will be difficult to show that the employee resigned due to a fundamental breach.
The concept of constructive unfair dismissal is that the employer has behaved in such a way that the relationship cannot be repaired, and arguably working a notice period or longer notice period, undermines this concept.
5. What can an employee claim?
As with an ordinary unfair dismissal claim there is a cap on the amount of compensation which can be awarded, which is one year’s gross salary, unless the employee is also claiming discrimination, in which case the cap falls away.
No matter what the claim is for, employees must bear in mind that the Employment Tribunal expect them to attempt to mitigate their loss, this means that if they obtain alternative employment any earnings will be taken into consideration, when calculating loss.
If an employee is unable to find alternative employment, then they must provide evidence to the Employment Tribunal of the job vacancies applied for and/or medical evidence showing why they have been unable to work. If sufficient evidence is not provided, then the Employment Tribunal may reduce the amount of compensation awarded for failing to mitigate their loss.
6. Do you need legal representation?
Defending Employment Tribunal claims can be costly, however, we are transparent about our costs and wherever possible provide our customers with a fixed fee for assisting with claims.
Further, we provide options whereby we can assist with the entire defence, or just certain aspects of it, this will enable you to choose how much assistance you require as well as keeping an eye on costs.
Whilst we try and make defending a claim as stress free and affordable as possible, you can defend yourself, should you wish and there is no requirement to have legal representation.
7. What is the Acas early conciliation process?
Employees must lodge their potential claim with Acas before they are able to submit the claim to the Employment Tribunal. The purpose of the Acas process is to try and resolve matters, without the need to issue a claim with the Employment Tribunal.
The service is completely free, so it is advisable for employees to go through the process before making a claim.
However, if an employee wants to lodge the claim and not go through the early conciliation process, they can notify Acas and a certificate will simply be issued enabling them to move straight to the claim process.
8. How long does an employee have to submit a claim?
The time limit on a constructive dismissal claim is three months less one day from the date of termination i.e the date the employee resigned or notice period expired.
The Acas early conciliation usually extends the limitation period, as the limitation stops when the process is commenced and is then extended by the time spent in the process.
If you find yourself defending a constructive unfair dismissal claim in the Employment Tribunal then please do get in touch, we offer a free half hour consultation and would be happy to provide some general guidance. We can of course also defend the claim on your behalf.