The term “constructive dismissal” is often thrown around by employees who believe they have been treated badly in their employment. However, the concept is not well understood, and constructive dismissal cases are difficult to win.
In short, a constructive dismissal occurs when an employee has no choice but to resign their employment and actually does so. This includes situations where an employee is told to choose between resigning and being fired, or more commonly, where an employer acts in a way that makes it untenable for the employment relationship to continue.
Constructive dismissal featured recently in a high-profile legal battle in the United Kingdom between the Chelsea Football Club and one of its medical staff, Eva Carneiro.
Caneiro claimed she was forced to resign following unfair and discriminatory treatment including sexual harassment.
One of the key incidents Caneiro cited in support of her claim occurred during a football match in August 2015 when she was required to step onto the pitch to treat an injured player. As a result of Caneiro providing medical attention, the team only had 9 active players for a time.
Caneiro’s actions apparently angered the team’s then manager, Jose Mourinho. Caneiro says that at the time he called her a “daughter of a whore” in Portuguese. He also demoted her from her role with the team, and described her as “impulsive and naiive”. Caneiro resigned shortly after.
Carneiro commenced proceedings in the UK’s Employment Tribunal. It has been reported that she was offered and rejected £1.2 million to settle. Then part way into the hearing, Caneiro agreed to a confidential agreement which brought the case to an end.
Had this same set of facts come before the Employment Relations Authority here, it is quite likely that the claim of constructive dismissal would have been upheld.
A New Zealand case between Jacqueline Preston and Comtec Communications Limited provides another good example of the types of behaviours that may result in a finding of constructive dismissal.
Preston claimed that throughout her employment with Comtec, she was treated by its director, Kevin Earl, in a rude, aggressive and intimidating manner. Preston says she raised concerns with Earl about his behaviour, but this only made things worse.
In December 2005, the situation deteriorated further when Earl allegedly became angry with Preston and started shouting at her. Preston claims the shouting was so loud that it could be heard in the store below Comtec’s offices.
Following the exchange, Preston engaged a lawyer to set out her concerns in a letter to Earl. The letter, which coincided with Preston going on annual leave, sought a commitment from Earl that he would cease the bullying behaviours. It also suggested a mediated meeting between Earl and Preston as a way of repairing the relationship.
When Preston returned to the office from leave, she was presented with a letter directing her to stay away from the office. This was followed by further letters also requiring that Preston stay away.
Preston was eventually allowed to return to work some three weeks later. However, she was given only given one piece of work to complete and was instructed not to do anything else.
The day after Preston returned to work, she attended a facilitated meeting with Earl. Earl claimed this meeting was his response to the lawyer’s letter. The meeting did not go well. Preston alleged Earl was hostile and aggressive during the meeting, and that she left in tears. The result was that Preston resigned 48 hours later, and then raised a claim for constructive dismissal.
Preston’s claim came before the Employment Relations Authority which found she had been constructively dismissed. It held the company created a situation that was untenable for Preston, and that it had engaged in a course of conduct so gross and insulting that she had no option but to resign. Preston was awarded nine month’s lost wages, and $12,500 compensation for hurt and humiliation.
In both of these cases, the employers’ conduct towards the employees was extreme enough that resignation was a foreseeable consequence. But many cases are less clear cut. Often the abuse of employees by employers is more invidious and it is difficult for an employee to identify the objectionable conduct in specific terms. Because of this, and the fact that the onus is on the employee to prove that they had no alternative but to resign, many constructive dismissal cases fail.