Constructive Dismissal Test Clarified

Louise Walker
Legal Director
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Recently, the Employment Appeal Tribunal (EAT) has clarified that constructive dismissal can be established even where the material breach relied on by the employee was not necessarily the predominant cause for the employee’s resignation.

It is well established that an employee will be constructively dismissed where:

1. The employer has committed a repudiatory (material) breach of contract;
2. The employee accepts the breach and resigns in response to the breach; and
3. The employee does not delay too long before resigning.

The EAT in this case however clarified that constructive dismissal can be established where the repudiatory (material) breach played a part in the dismissal. In short, it may be sufficient for the breach to be an effective cause of resignation, and not necessarily the effective cause of resignation.

In this particular case the employee was a care-at-home assistant until she resigned. The initial employment tribunal found that the employee’s grievances had been poorly handled. However, the tribunal dismissed the employee’s claim for constructive dismissal on the basis that the employee’s caring responsibilities for her partner who had experienced health problems was ‘the’ effective cause of her resignation rather than the employer’s conduct. The EAT disagreed with this reasoning and determined that it was sufficient for the repudiatory breach to be ‘an’ effective cause, in other words, an influencing factor with no requirement that it be the most important cause.

In a previous case (http://www.bailii.org/uk/cases/UKEAT/2012/0069_12_1907.html) the EAT found that once a fundamental breach has been established as having taken place, the question for a tribunal to ask is whether this fundamental breach at least formed part of the reasoning for the employee’s resignation.

What this means in practice is that employment tribunals may more readily find constructive dismissal established even where there are a number of factors contributing to the employee’s decision to resign. Where an employment tribunal finds that an employee has been constructively dismissed, the tribunal will go on to consider whether the dismissal was fair or unfair in the circumstances of the case.

If unfair, the employment tribunal has to consider what compensation is just and equitable in all the circumstances. Where the breach is an effective clause, rather than the effective clause it is likely that compensation will be adjusted to reflect the actual contribution of the particular breach to the constructive unfair dismissal.

Find out more about this case here.

Topics: EAT, Employment Appeal Tribunal